Housing and the cost of living
Housing has risen less in the euro area than in the US, and so have rents. Almost seven in ten Europeans live in a home they own, but those renting at market prices bear far higher costs, and the gaps between countries in cost and space are huge.
Between two giants
After inflation, housing has become far more expensive in the US than in the euro area. In China, it has become cheaper.
In 2025, real house prices in the euro area were 11% higher than in 2010. In the US, 58.5% higher, and in China, 10.5% lower. The three blocs have taken different paths: in the euro area, real prices fell until 2013 and peaked in 2021; in the US they collapsed after the 2008 crisis, bottomed out in 2011 and hit their peak in 2024; in China they peaked in 2021 and in 2025 were at the lowest level of the whole series, which starts in 2006.
After inflation, housing costs 11% more than in 2010 in the euro area, 58.5% more in the US and 10.5% less in China
Real residential property prices, index 2010 = 100, annual average
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These are prices after inflation. Without adjusting for it, housing in the EU rose 62% between 2015 and 2025, as note N01 showed, almost twice as much as prices overall. Rents have also climbed much more across the Atlantic: between 2015 and 2024 they rose 46.9% in the US and 15.5% in the euro area, at current prices.
Between 2015 and 2024, rents rose 46.9% in the US and 15.5% in the euro area
Rent price index, 2015 = 100, at current prices
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Is Europe losing, or choosing?
Europe is, above all, a continent of homeowners. Those who rent at market prices pay for it.
In 2025, 68.5% of the EU population lived in a home they owned, slightly fewer than in 2010 (70.7%). The differences reflect different models. In Slovakia, Romania and Croatia more than 91% are owners, and in Romania almost all of them without a mortgage. At the other end, Germany is the only country where owners are fewer than half (47.2%), followed by Austria (54.2%) and Denmark (58.4%). In the Netherlands, 57.9% of the population lives in an owned home with a mortgage. Spain, at 73.6%, is above average, but ownership has fallen from 79.8% in 2010, and tenants at market rent have risen from 11.9% to 17.4%.
Almost seven in ten Europeans live in a home they own; only in Germany is it fewer than half
Population by tenure status of their home, in %
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Owning or renting makes a big difference to how much housing weighs on household budgets. In 2025, 18.6% of Europeans renting at market prices lived in a household spending more than 40% of its income on housing. Among owners with a mortgage, 5%, and among those without one, 3.8%. For market-rent tenants the share has fallen from a peak of 27.1% in 2014, but it is still almost four times that of owners with a mortgage.
18.6% of tenants at market rent spend more than 40% of their income on housing; among owners, 5% or less
EU population living in households that spend more than 40% of their disposable income on housing, by tenure status, in %
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Europe from within
Behind the European average are countries where housing costs crush households and others where space runs short.
In 2025, 7.7% of the EU population lived in a household spending more than 40% of its income on housing, down from 11.2% in 2015. Greece is the extreme case: 26.4%, although in 2015 it was 45.5%. It is followed by Denmark, whose figure is affected by a change in method, and Germany (11.2%). In Cyprus it is 2.4%, and in Croatia, 3.2%. Spain, at 7.2%, has the eighth highest share.
In Greece, 26.4% of people spend more than 40% of their income on housing; in Cyprus, 2.4%
Population living in households that spend more than 40% of their disposable income on housing, in %
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The other problem is space. In 2025, 16.8% of Europeans lived in a home with fewer rooms than their household needs. In Romania it was 40.4%, and in Latvia, 38.9%; in Cyprus, 2.2%, and in the Netherlands, 4.1%. Owning does not prevent overcrowding: of the eight countries with the most homeowners, seven have more overcrowding than the EU average; the exception is Hungary. In Spain it is below average but has risen from 5% in 2010 to 9.5%.
In Romania and Latvia, about four in ten people live in a home with fewer rooms than they need; in Cyprus, 2.2%
Overcrowding rate: population living in a dwelling with fewer rooms than their household needs, in %
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Notes on this theme
Other themes
- AI and digitalThe EU is adopting artificial intelligence faster than ever, but almost all the technology it uses is designed elsewhere.
- Trade and dependenciesFor decades the EU was the world's largest trading power. China has overtaken it, and Europe increasingly depends on others to buy and to sell.
- Productivity and growthThe EU weighs as much in the world economy as the United States, but it produces less per hour and much less per person. The question is how much of that gap is lagging behind and how much is choice.
- Freedoms, well-being and climateEurope lives longer, pollutes less and protects freedoms more than the United States or China. But those advantages are not equal across its countries, and some are eroding.
- HealthThe EU spends far less on health than the US, and people live longer. Most of it is paid with public money, but each country differs in how many doctors it has and how much patients pay themselves.
- Money and paymentsThe euro area holds more cash relative to its economy than the US and China, but uses it less and less to pay. Cards are filling the gap, largely through non-European networks. The digital euro is the EU's bet to keep public money present in electronic payments.
- EnergyThe EU uses less than half as much energy per person as the US, and China has now overtaken it. Its electricity relies far less on fossil fuels, but renewables cover only a quarter of all its energy, and industry pays considerably more for power than before the 2022 crisis.