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European Cities grapple With Soaring Rents And Housing Crisis
A recent study analyzing rent-to-wage ratios in 26 major European cities reveals a stark reality: cities with higher nominal wages are not immune to the housing crisis. In cities with already low wages, the impact of rising rents is notably acute. Europe‘s housing crisis demands a multi-pronged approach. Governments need to address the underlying issues to provide affordable housing solutions.
Europe strains under rising prices as renters bear brunt of housing crisis
Europe strains under rising prices as renters bear the brunt of the housing crisis. Attila Kálmán. 8 December 2022. About Untaxed. Over the past months, Investigate Europe’s team analyzed the taxation and loopholes for real estate investments in several European countries. This lures billions of euros to the overheated real estate market.
Europe’s rents are on the rise: Who’s hardest hit?
We collected data on rent-to-wage ratios and the reasons for rising housing costs in 26 major European cities to identify the causes and potential remedies for Europe’s housing crisis. Our findings are twofold.
Findings in the cities studied by the Housing Anywhere index don’t leave much room for optimism. Lisbon and Budapest are the most critical on this list, with rents advertised at 88% of the median wage, making it virtually unachievable for a single median earner to rent an apartment on their own. The problem is not confined to the EU: in Belgrade, data collected by CINS suggests that renting an apartment would currently cost almost 58% of the average wage in the city. Dublin is not much better, where this ratio would be 69%, suggesting that it would be difficult for anyone to afford such rents on their own.
Europe’s housing crisis is obviously a multi-dimensional issue, but some themes seem to recur when examining the commonly cited causes of house prices getting out of control. The first culprit, common to many cities, is the excessive presence of tourism, notably Airbnb and othre similar rental sites, which allow property owners to rent out potential residential properties as temporary accommodation for tourists. The profitability of Airbnb units means that many houses remain unoccupied, i.e., not occupied by a regular tenant.
European Cities Grapple With Soaring Rents and Housing Crisis
A recent study analyzing rent-to-wage ratios in 26 major European cities reveals a stark reality: cities with higher nominal wages are not immune to the housing crisis. In cities with already low wages, the impact of rising rents is notably acute. Europe’s housing crisis demands a multi-pronged approach. Governments need to …
Europe’s housing crisis is obviously a multi-dimensional issue, but some themes seem to recur when examining the commonly cited causes of house prices getting out of control. The first culprit, common to many cities, is the excessive presence of tourism, notably Airbnb and other similar rental sites, which allow property owners to rent out potential residential properties as temporary accommodation for tourists. The profitability of Airbnb units means that many houses remain unoccupied, i.e., not occupied by a regular tenant.
Interview: Understanding Europe’s Housing Crisis
editor: Welcome to our discussion today. We’re here to talk about the recent study that analyzed rent-to-wage ratios in major European cities.Could you start by giving us an overview of the findings?
guest: Thank you for having me. the study reveals a notable issue: even in cities with higher nominal wages, residents are struggling with the rising rents. This is particularly acute in cities where wages are already low. The housing crisis in Europe is complex and requires a multi-faceted approach from governments to address it effectively.
Editor: What are some of the common factors contributing to the housing crisis in these cities?
Guest: One of the primary factors is the excessive presence of short-term rentals, particularly through platforms like Airbnb.These platforms allow property owners to rent out residential properties as temporary accommodation for tourists. The profitability of these short-term rentals means that many properties remain unoccupied, i.e., not occupied by a regular tenant.
Editor: How does the presence of Airbnb and similar platforms exacerbate the housing crisis?
Guest: Airbnb and similar platforms have led to a significant reduction in the number of long-term rental units available. This is as property owners find it more profitable to rent out their properties on a short-term basis to tourists, rather than to long-term tenants. As a result, the supply of affordable housing decreases, driving up rents and making it difficult for residents to find and afford suitable housing.
Editor: What role do you think government policies should play in addressing this issue?
Guest: Governments need to implement policies that regulate short-term rentals more strictly. This could include limiting the number of days a property can be rented out on platforms like Airbnb, or imposing higher taxes on short-term rentals. Additionally, governments should invest in building more affordable housing to increase the supply and alleviate the pressure on rents.
Editor: Are there any specific cities where the impact of Airbnb has been particularly noticeable?
Guest: Yes, cities like Barcelona, Paris, and Berlin have seen a significant increase in Airbnb listings. In these cities,the high demand for short-term rentals has led to a reduction in long-term rental units,contributing to the housing crisis. These cities have also implemented stricter regulations on short-term rentals to mitigate the impact.
Editor: What are some of the potential solutions to balance the needs of both tourists and long-term residents?
Guest: Balancing the needs of both tourists and long-term residents requires a nuanced approach. Governments can implement zoning regulations that designate specific areas for short-term rentals, while ensuring that the majority of residential properties are reserved for long-term tenants. Additionally, promoting lasting tourism practices can help reduce the demand for short-term rentals and alleviate the pressure on housing.
Editor: Thank you for your insights. what are the main takeaways from our discussion?
Guest: The main takeaways are that the housing crisis in Europe is a complex issue influenced by various factors, including the excessive presence of short-term rentals. Governments need to implement policies that regulate these rentals and increase the supply of affordable housing to address the crisis effectively.Balancing the needs of tourists and long-term residents is crucial for creating sustainable and livable cities.
