Once upon a time, housing was declared a human right, and states were obligated to provide adequate housing for all. However, because governments often rely on the private sector to fulfill this responsibility—and because housing has become a highly profitable investment—it has become increasingly unaffordable and inaccessible. If you cannot afford high rents or mortgages, and if there is insufficient social or cooperative housing in your city, you are left without options. So, what happened to the idea of housing as a human right?
In the ISHF session “Advancing Policies Against Speculation in Housing Investment in Favor of the Social Function of Housing,” Irene Escorihuela, Marta Ribera Carbo, Miguel Ruiz, and Paula Sevilla Núñez presented research on how states depend on private actors for housing provision.
Marta Ribera Carbo of The Shift shared alarming statistics: in 2024, global investment in housing reached $287.6 trillion—four times the global GDP. Housing is now the world’s most valuable asset, and its value continues to grow rapidly. “We’ve become addicted to real estate investment,” she concluded, “and housing has become a tool for financial speculation.”
Why is private equity in housing a problem?
Marta explained that equity funds prioritize profit over the provision of quality, affordable housing. She summarized the consequences as follows:
- Unavailability – New apartments are only accessible to those who can afford them.
- Insecurity – Tenants face eviction if they pay below market rates.
- Unaffordability – A growing share of income is spent on housing.
- Uninhabitability – Landlords cut maintenance costs to maximize profits.
Global South
The financialization of housing has had a particularly severe impact on rapidly growing cities in the Global South. Paula, from the UK-based think tank International Institute for Environment and Development, noted that urbanization is traditionally seen as a sign of progress—improving living conditions and quality of life. However, when urban development is profit-driven and financed by foreign equity, it leads to deepening inequality. Those who can afford it enjoy modern urban life, while others face eviction and exclusion.
European Union
In the EU, foreign equity is also gaining influence. Marta emphasized the need for strong regulation. She proposed two key strategies:
- Decommodify housing – Shift the focus from profit to social value by promoting public housing, community-led initiatives, and the social production of habitat.
- Regulate the market – Implement rent controls, prevent exploitative landlord practices, and curb speculative investment.
Finally, Miguel Ruiz of Observatori DESC summarized methods to prevent acquisition of houses by foreign private equity, that can be implemented by local and national governments: by tax, by regulation.
