Rethinking Housing Affordability in BiH and Montenegro: Lessons from Denmark and the Netherlands

A new comparative policy paper has found that housing affordability in Bosnia and Herzegovina (BiH) and Montenegro has reached crisis levels, with low-income households spending over 40% of their income on shelter. Driven by diaspora and foreign investor demand, uncoordinated housing strategies and an expanding informal rental sector, prices are spiraling beyond the reach of residents. While often touted as a solution, social housing remains underdeveloped and poorly governed, making it ineffective in its current form.

Drawing lessons from Denmark and the Netherlands, the study shows how robust housing systems—with clear fiscal policies, tenant protection frameworks, and market regulation—can curb speculation, support affordability and create long-term stability. For the Western Balkans, the path forward lies in formalizing rental markets, boosting transparency, protecting tenant rights and using tax policies to tackle vacancy and property hoarding. This research marks a crucial step toward more equitable and resilient housing strategies across the region.