The European Commission announced its first-ever plan to address the shortage of affordable homes in the EU. It will regulate short-term rentals and fight speculation in housing markets. The plan aims to help young people, key workers, and families priced out by soaring rents. Dan Jørgensen, EU's first commissioner for housing, warned, "If we don’t solve this issue, we risk leaving a void that extremist political forces will take." By the end of 2026, the Commission will draft legislation to regulate short-term rentals via platforms like Airbnb and Booking.com. Local authorities will get clearer powers to control this booming trade but the Commission said it does not want to ban holiday lets. For example, Barcelona faces legal challenges for banning tourist apartment rentals by 2028. EU laws will allow cities to take "justified and proportionate measures" such as capping rental nights to protect housing. Jørgensen said, "We are not forcing cities or regions or member states to do these things but we are making it possible to solve these problems where they arise." The Commission will also allow member states more freedom to fund affordable housing through subsidies. On speculation, it will study property markets to better understand speculation patterns and ownership issues. The plan was welcomed by the Socialist group in the European Parliament as a "historic milestone" for responding to the "social emergency." Their leader, Iratxe García Pérez, called for "quick and ambitious implementation with massive investments." But some critics called it "a framework of intentions" lacking strong actions on speculation. Finnish Green MEP Maria Ohisalo said the plan misses a "more decisive approach to real estate speculation." The centre-right European People's Party praised efforts to reduce red tape and speed up housebuilding. The Commission also plans to review existing EU rules to ease administrative burdens on small housing developers. Housing costs have surged across the EU. From 2010 to 2024, house prices rose by 53% and rents by 25%, outpacing general inflation of 39%. Rents skyrocketed in some countries: Estonia (208%), Lithuania (177%), Ireland (108%), and Hungary (107%). Nearly 10% of city residents pay over 40% of their income on housing, with Greece (29%) and Denmark (23%) the worst hit. Barcelona’s mayor, Jaume Colboni, called housing costs "a new pandemic." He and other city leaders asked the EU to raise at least €300 billion annually in public and private funding to build affordable homes. The EU did not agree to a special fund but highlighted a €375 billion investment pledge from European public and regional banks for social and affordable housing by 2029.