Abstract:  As the housing affordability crisis strikes many cities around the world, public institutions and citizens have started to become aware of growing problems in the access to adequate affordable housing. The issue is particularly evident in Milan, where increased attractiveness is paralleled by a huge rise in housing prices. This article presents the results of research conducted by the Affordable Housing Observatory of Milan, contributing to public knowledge on housing affordability problems and envisioning possible policies to tackle them. Housing issues are contested and political in nature, and in the Italian context the debate is often led by the voice of the real estate sector while data are highly fragmented and knowledge about housing affordability is limited, especially in Milan. We fill this gap by conducting an original analysis of existing public data on the housing market, the labour market and incomes to highlight the trends in housing affordability in Milan. We focus on the period starting in 2015, a turning point for Milan with the international EXPO and the beginning of an intense phase of urban transformation and real estate development. The article shows how the increase in housing prices and rents has outpaced growth in incomes and wages by nearly a factor of three and how a major share of income earners in Milan cannot afford decent housing. These trends expose lower-income residents to the risk of expulsion and condition access to a job in the city to ownership of assets or financial assistance from parents (especially for first-time buyers and the younger generations). Finally, the article reflects on the implications of growing unaffordability with reference to policies targeting housing costs, incomes, and wages.

Keywords:  housing affordability; housing observatory; housing policy; Milan

Published:   14 November 2024

Issue:   Vol 9 (2024): Housing Affordability Crisis: How Can We Address It?