Modern construction methods can help lower housing costs and boost supply, according to European Economic and Social Committee (EESC).
But it also warns this is possible only if there is a “convergence of innovation, quality and respect for workers’ rights and the interests of the public.”
It says that by drawing on the potential of modern construction methods, the EU could lower building costs, shorten construction times and reduce carbon footprints.
In doing so, it would be “championing the circular economy in the construction sector.”
This is the strong conviction that the EESC outlines in its opinion adopted at its September plenary session.
Drawn up by John Comer and Thomas Kattnig, the opinion had been requested by the Irish Presidency of the Council of the EU and tackles the issue of housing shortages.
More specifically, the opinion deals with the framework conditions needed to increase the supply of repurposed, renovated and new housing, and provides guidance to relevant actors on implementing modern construction methods.
Comer said, “Modern methods of construction can become a key pillar of affordable housing, but only if innovation, quality, workers’ rights and public interest objectives advance together.”
Kattnig added, “Modern methods of construction must not be seen as merely a technological or market-driven issue, but must be part of a broader social, labour market, affordability and industrial policy strategy.”
The construction sector remains characterised by relatively low productivity growth and fragmented supply chains, says the EESC.
Modern methods of construction can counter these issues because they are based on innovative off-site manufacturing and on-site techniques designed to build higher-quality structures faster and more efficiently than traditional building approaches.
Examples include scaling up industrialised approaches such as modular, prefabricated and off-site building.
Modern methods of construction therefore have the potential to lower overall construction costs and times and to increase structural precision, quality control, industry capacity and productivity.
To achieve these objectives, modern methods of construction need a developed industrial capacity.
This is why the EESC says it argues that the EU needs to drive forward targeted investment to increase industrial capacity to manufacture systems for prefabrication and offsite construction.
The EU’s housing emergency is not new.
House prices in the EU have risen by more than 60.5% since 2013, while rents increased by 28.8% between 2010 and 2025. In 2024, the housing cost overburden rate was 8.2% on average in the EU.
Across Europe, the dramatic mix of high inflation and insufficient wage and pension increases has lowered the disposable incomes of households. This disproportionately affects vulnerable groups, women and young people.
On top of this, the decrease in new housing triggers pressure on both purchase and rental markets, leading to price and rent inflation.
A number of additional factors has further exacerbated the housing crisis.
The COVID-19 pandemic, Russia’s war of aggression against Ukraine, surging energy prices and increased material costs have made the situation even worse.
Against this backdrop, mortgage interest rates have doubled, and the number of building permits issued in the EU between 2021 and 2024 has fallen by 25%.
