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Housing remains costly and unaffordable for many European households

Source: Own illustration based on data from European Central Bank Statistics, OECD National Accounts Statistics and Eurostat Database, EU-SILC.

Housing affordability has become a central issue in recent years as some population groups find themselves priced out of the housing market in some European countries or cities. Although the financial crisis depressed housing prices, these have in the meantime recovered in most countries. Disposable income however, particularly among lower income households, has yet to increase significantly, with housing costs representing nowadays a significant financial burden on low income families. The share of households "overburdened" by housing costs (i.e. the latter represent more than 40% of disposable income) ranges from between 33%-34% in Hungary and Italy, to 42-43% in the UK and the Netherlands. Countries have implemented housing allowances to alleviate this problem, and although these allowances overwhelming target the poor, their poverty reducing impact is somewhat limited. Detailed account of why this is the case, further results and policy implications can be found in the original research note and in a policy brief by Eszter Zólyomi and Katarina Hollan.

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