Unlike those described by Naomi Klein (Shock Doctrine: The Rise of Disaster Capitalism, 2007) this crisis was not planned. Yet, emergency measures to protect people’s lives have been breathtaking; bans on evictions, mortgage and rent deferrals, universal health care and guaranteed minimum incomes, all taken with a speed and certainty that cuts right across all the “impossibilities” of the recent past. House stockbrokers estimate a fall of 30% in house prices and rents.
Like the response to the GFC of 2008/9 this will also be EU-wide. But this time human rights cannot be ignored in EU economic governance, as it impacts on housing. This is becoming an EU-wide issue, with flows of finance into European cities segregating income groups, denying housing access to those on low incomes, particularly emerging households and migrants. Pressure on rented housing has been used in the populist anti-immigration agenda.
While housing policy and social provision are largely Member State competences, access to, and enjoyment of, housing rights are impacted by the EU economic governance and financial supervision framework. This combines ECB driven monetary policy, based on price stability, or controlling inflation (although it does not include house prices in that calculation), with a range of fiscal and economic policies under the responsibility of Member States. There is EU coordination (rather than control) of Member States policies.
The social consequences of the GFC demonstrated finance can undermine established human rights. Still, housing rights advocates, EU legislators, regulators, supervisors and policy makers share many common objectives. These include broad financial and banking stability, effective supervision of lenders, prevention of macroeconomic imbalances through house price bubbles, sustainable public finances for housing and mortgage systems, and combatting money laundering – often expressed in housing/land speculation in European cities.
The GFC changed everything, and the Pringle case revealed an overarching EU institutional objective of protecting the financial stability of the euro area as a whole. Significant EU resources are now dedicated to analysing macro-economic imbalances, risks and ‘bubbles’ in housing markets, with EU-driven rules on capital buffers, sustainable lending levels, loan-to-income and debt service-to-income ratios – essentially restricting mortgage lending to the top income deciles. ECB monetary policy and centralised financial supervision determines mortgage lending rates and levels, and costs of government bonds, which impacts on public housing expenditure. Other significant impacts arise from the rules on the internal market, competition law and State aid, freedom of movement of workers, consumer protection, social inclusion policies, equality and non-discrimination provisions, standardisation of construction products, public procurement rules, and energy and environmental standards advanced within the EU. The European Commission, through the European Semester, provides Member States with policy support, guidance and orientation on how to design efficient national policies aimed at ensuring citizens’ access to affordable and accessible social housing, by stressing housing supply shortage, dysfunctional housing markets, macroeconomic imbalances and insufficient stock of social housing.
The financialisation of housing has placed it centre-stage of EU policy. Rather than inter-governmental add-ons, EU measures are now constitutive of Member States housing systems and ‘markets’. But housing is becoming the ‘wobbly pillar’ of EU banking stability, and its central place in the land/credit cycle poses a risk to economic sustainability and financial stability, and vice versa. The ‘addiction’ to property-related lending means that any Member State’s housing policy measures could impact on EU banking stability, and the ECB reviews all relevant draft national laws.
EU Charter housing rights
Housing rights have been established across European constitutions, laws and policies for more than a century. Many of these are included in the EU Charter of Fundamental Rights. This creates binding obligations on EU institutions (and on Member States in limited situations), acting within their competences and mandates, to respect and promote these rights. But many EU institutional and “technical” approaches to housing and housing “markets” do not yet respect, observe or promote Charter housing rights, including Article 36 recognising and respecting access to housing services of general economic interest.
Today, housing rights advocates, trade unions, public representatives (especially MEPs) and policy makers can play a vital role to ensure that Charter housing rights are not just respected but promoted. All these issues are set out in three Briefings available at:http://www.nuigalway.ie/chlrp/news/this-time-it-will-be-different.html
- Housing and Housing Rights in the EU Charter of Fundamental Rights;
- EU Economic Governance and Financial Supervision;
- Integrating EU Charter Housing Rights into EU Economic Governance and Financial Supervision.
 See Inchauste, Gabriela, et al. (2018) Living and Leaving: Housing, Mobility and Welfare in the European Union. The World Bank, Washington DC, http://pubdocs.worldbank.org/en/507021541611553122/Living-Leaving-web.pdf, p. 17.
 See Dunja Mijatović, (2020) Commissioner for Human Rights, Council of Europe: The right to affordable housing: Europe’s neglected duty. https://www.coe.int/en/web/commissioner/-/the-right-to-affordable-housing-europe-s-neglected-duty
 See European Commission (2020)– Economic governance review, COM(2020)55 final, p. 2
 Ryan-Collins, J., Lloyd, T. and McFarlane, L. (2017) Rethinking the Economics of Land and Housing (London: Zed), p. 110.
Dr. Padraic Kenna is a Senior Lecturer at School of Law at NUI Galway and lectures on housing law, rights and policy, property law and regulation: https://www.nuigalway.ie/our-research/people/law/padraickenna/ Before joining the University he worked with a range of statutory and non-government agencies in the UK and Ireland, in an advocacy role, and in the development and management of social housing.