Philenews

New State Aid Framework for Affordable Housing

Published December 30, 2025, 12:18
New State Aid Framework for Affordable Housing

The European Commission has implemented a new framework for state aid, modifying the previous regulatory framework for Services of General Economic Interest (SGEI). The most significant change concerns the eligibility of compensation for affordable housing, aiming to increase the availability of housing through renting or homeownership at accessible prices. The aid will be granted to market operators to cover investment costs for the construction, renovation, or conversion of apartments or buildings, as well as for meeting accessibility and climate resilience requirements. Beneficiaries of the aid will be selected based on household income, in relation to market prices and household composition. Additional factors, such as employment in essential social roles, disability, age, student status, and single parenthood, will also be considered. The new framework includes safeguards to limit competition, as well as affordability indicators and quality housing criteria. Provision remains for compensating social housing for disadvantaged groups. The maximum annual compensation limit is increased from 15 million euros to 20 million euros, with affordable housing being excluded from this rule. Exceptions also remain in place for social housing, the provision of SGEI by hospitals, SGEI for social needs, air and sea connections to islands, and airports and ports, with an increase in the annual passenger traffic parameter for the latter two categories. Furthermore, the registration of compensation exceeding 1 million euros in a central register is required from January 1, 2028. Finally, a two-year transitional period is provided for measures implemented under the previous framework. The new decision will enter into force 20 days after its publication in the Official Journal of the European Union.