Estonia is a country known for its innovation, resilience, and digital leadership. But like many parts of Europe, it faces a growing challenge: the lack of affordable housing. Rising prices and limited rental options are making it harder for families, young people, and essential workers to find a decent place to live.
At the European Investment Bank (EIB), we believe that everyone deserves access to a safe, sustainable, and affordable home. That is why we’ve introduced a new Housing Action Plan to support housing projects across the European Union – to innovate, renovate and build affordable new homes. Our goal is to help deliver one million affordable and sustainable homes by 2030.
In Estonia, the need is clear. While homeownership is high — around 80% of the population lives in homes they or their relatives own — affordable rental options remain scarce, and social housing is extremely limited.
Affordable housing refers to homes for which housing costs do not put an unreasonable burden on the household. Eurostat, for example, defines this as not exceeding 40% of household income.
Affordable housing for working families
It is not limited to municipal public housing, which typically serves for the most vulnerable. Rather, it covers a broader spectrum, ensuring that teachers, nurses, young professionals, and low- to middle-income families can access decent-quality housing in the communities where they work, without facing excessive housing costs.
Today, in Estonia, young families and single parents—many unable to afford a mortgage down payment—make up a large share of renters.
As part of our housing initiative, the EIB is leveraging its expertise in the European housing market to support public sector entities with tailored, strategic advice. In Latvia, we are already collaborating with the government on affordable rental housing, with the first phase aiming to deliver several thousand energy-efficient apartments across the country by 2030.
We are also working in Czechia, Slovakia and Croatia, while in Lithuania, we are a major stakeholder in the multi-apartment building modernisation programme.
In Estonia, we are active through the ELENA facility, run jointly with the European Commission, which supports energy efficiency renovations. In Tartu, it has enabled deep renovations of apartment buildings with integrated renewable energy. In Ida-Virumaa, the “Ida-Viru Renovates” project is helping buildings reach higher energy standards—supporting long-term housing affordability and lower energy bills.
Partnering to finance new housing solutions
To further strengthen our engagement, the EIB has recently opened a local office in Tallinn, enhancing our ability to work closely with partners on the ground.
The EIB is ready to support Estonia’s efforts to expand access to such housing. This includes supporting innovative and sustainable construction methods, financing energy-efficient renovations to reduce emissions and utility costs, and helping to increase the supply of affordable homes through both direct and intermediated financing.
Encouragingly, Estonia welcomes our initiative and is already engaged in negotiations to design a model and implementation strategy in collaboration with the EIB.
To make it easier for local authorities, developers, and communities to access support, we’ve created the “More homes. Better homes.” online portal. It connects housing stakeholders with the advice, funding, and financing they need. The response so far has been encouraging—clear proof of both the urgent demand and the opportunity ahead.
But the EIB is not acting alone. We are working closely with the European Commission, national governments, cities, and promotional banks. Because solving the housing crisis requires strong partnerships at every level.
And this is about more than just housing. Affordable homes are essential for economic competitiveness, climate resilience, and social cohesion. They support a more inclusive economy, reduce emissions through energy-efficient living, and help communities thrive. In short, affordable housing is a foundation for a fairer, greener, and more prosperous future.
That’s why I’m pleased to announce that the EIB Group will soon conduct a roadshow in several EU members led by my colleague Vice-President Ioannis Tsakiris. We aim to bring together housing stakeholders from every corner of Europe as we promote new financing and support opportunities for the sector.
Estonia has the talent, the tools, and the determination to lead in this space. Together, we can ensure that every Estonian, regardless of income or background, has a place to call home.
This article was originally published by Postimees.
