EIB Signs Record €700m Deal With Flanders to Boost Social Housing and Cut Energy Bills

With support from the full €1.7 billion facility, the Flemish government will assist municipalities and cities in meeting their social housing targets.

 

The European Investment Bank (EIB) has signed a €700 million financing agreement with the Belgian Region of Flanders to support the construction and renovation of thousands of social housing units, improving affordability while reducing energy costs for tenants.

Signed in Brussels with Flemish Ministers Ben Weyts (Finance) and Hans Bonte (Housing), the agreement represents the first tranche of a €1.7 billion financing package approved by the EIB’s Board of Directors. The package marks the largest EIB operation ever undertaken in Belgium.

Accelerating Social Housing Delivery in Flanders

With support from the full €1.7 billion facility, the Flemish government will assist municipalities and cities in meeting their social housing targets. Flanders plans to build approximately 56,000 additional social housing units and renovate thousands of existing homes to higher energy-efficiency standards by 2042.

The programme is designed to address a growing shortage of affordable rental housing while ensuring that new and renovated homes meet modern energy performance standards. These upgrades are expected to significantly lower heating and electricity costs, offering critical relief to low- and middle-income households.

Record EIB Support for Housing and Affordability

EIB Vice-President Robert de Groot said the partnership reflects the Bank’s core mission of improving everyday life for European citizens.

“Our main mission is to finance projects that benefit European citizens and improve people’s daily lives. This partnership with Flanders will do exactly that,” de Groot said.

“By supporting the building and renovation of thousands of homes, we are helping municipalities provide more people with quality, affordable and energy-efficient housing. Just last year, the EIB provided a record €5 billion in housing financing across Europe, and we are proud to support Flanders in ensuring everyone has a roof over their head.”

Reducing Costs Through Preferential Financing

Flemish Minister of Finance Ben Weyts said the agreement reflects a prudent investment approach focused on long-term public value.

“We borrow to invest. Just as a Flemish family takes out a mortgage to build a home, the Flemish government borrows to build many homes,” Weyts said.

“And like any family, we look for the most advantageous loan. By working with the European Investment Bank, we will save around €35 million in interest costs on this first €700 million tranche alone.”

Tackling the Housing Crisis and Rising Energy Costs

Interim Minister for Housing Hans Bonte described the agreement as a decisive response to a worsening housing crisis in Flanders.

“Flanders is facing a genuine housing crisis. Affordable rental housing is in short supply and rents are rising sharply,” Bonte said.

“Thanks to €1.7 billion in preferential loans from Europe, we can significantly scale up social housing. Construction costs have increased dramatically in recent years, and by offering housing associations loans with a 2% interest subsidy, we can build and renovate more homes, faster.”

Bonte added that improved energy efficiency will help shield vulnerable households from high energy bills, delivering both social and economic benefits.

Supporting Energy Transition and Social Cohesion

Beyond affordability, the EIB-financed programme supports Europe’s clean energy transition by upgrading buildings to higher efficiency standards, reducing emissions and strengthening energy security.

By offering long-maturity loans, the EIB enables faster delivery of housing projects, helping ease pressure in a sector facing rising demand, higher costs and limited supply.

EIB officials said the initiative demonstrates how targeted public investment can simultaneously address housing shortages, reduce energy poverty and support Europe’s broader goals of social cohesion and climate resilience.