A renovated apartment building, a greener public square or improved transport links can transform a neighbourhood. For residents, these changes can mean better homes, cleaner surroundings, improved services and a higher quality of life.
Across Europe, cities are investing in neighbourhood regeneration to make urban areas more sustainable, attractive and liveable. Yet these improvements can also have unintended consequences. As neighbourhoods become more desirable, property values and rents may rise, attracting wealthier residents and investors while putting existing communities at risk of displacement.
These pressures can be made worse by tourism, property speculation and a shortage of affordable housing. In some neighbourhoods, long-term residents and local businesses are already struggling with rising costs, raising concerns about gentrification and the loss of established communities.
With Europe facing a housing affordability crisis, cities face a growing challenge: how can they improve neighbourhoods, attract investment and create better places to live without pricing out the people who already call them home?
As Luka Korlaet, Deputy Mayor of Zagreb, explains: “We are trying to fight for our citizens to stay, to make our cities liveable and sustainable for everyone.”
A new approach to neighbourhood regeneration
This challenge is at the heart of NEBwork, a new EU-funded project bringing together 17 neighbourhoods across six cities: Athens, Barcelona, Florence, Ghent, Lyon and Zagreb. All six are members of Eurocities and the Mayors4Housing Alliance and face significant pressure on their local housing markets.
The project aims to tackle gentrification and prevent displacement by working with residents to develop more inclusive, sustainable and affordable neighbourhoods.
We are trying to fight for our citizens to stay, to make our cities liveable and sustainable for everyone.
At a high-level breakfast debate in Brussels to launch the project, city leaders, MEPs, European Commission officials and other European organisations explored how regeneration can improve people’s lives without forcing them to leave their communities.
The discussions highlighted the importance of putting housing affordability, social inclusion and residents’ participation at the centre of neighbourhood regeneration, supported by effective local policies and sustained EU investment.
Improving neighbourhoods without losing communities
A central message from the debate was that improving buildings and public spaces does not necessarily improve the lives of the people already living there.
As Ivana Katuric, Director at Urbanex, explained: “We need to rethink the concept of regeneration, considering not only the physical dimension but also the social dimension of the process.”
For André Sobczak, Secretary General of Eurocities, successful regeneration means ensuring existing residents benefit from the improvements taking place around them. “Regeneration of neighbourhoods is not only about buildings and public spaces,” he explained. “It’s much broader. It’s bringing a better life to people living in a neighbourhood and making sure the advantages are not only for newcomers, but also for those who are already there.”
Sobczak identified three essential conditions: protecting and increasing affordable housing from the outset, involving residents in decisions and securing long-term investment.
Backing this position, Deputy Mayor Korlaet reinforced the importance of giving residents a meaningful role in shaping regeneration. He highlighted an international architectural competition in Zagreb’s Sveta Klara neighbourhood which has developed innovative ideas for more inclusive housing and neighbourhood design.
It's bringing a better life to people living in a neighbourhood and making sure the advantages are not only for newcomers, but also for those who are already there.
“Participation should not be an afterthought. It cannot come at the end, just as an added value. It has to come from the beginning,” he stated.
Housing protection must come first
Keeping residents in their homes also requires concrete measures to prevent rising housing costs and displacement. Barcelona offers an example of how cities can protect affordable housing while improving neighbourhoods.
Mar Jiménez, Commissioner for European Affairs at Barcelona City Council, stressed that “housing is a fundamental right” and explained that homes should be used for living rather than speculation. “Cities must continue to grow and improve, but never at the expense of the people who call them home,” she said.
Barcelona has introduced measures to protect tenants and expand public housing, including rent regulation in designated high-pressure areas, purchasing residential properties and restricting tourist apartments. Since 2015, the city has acquired around 1,600 homes for its public housing stock, including through its right of first refusal.
These local efforts come as housing becomes an increasingly important EU priority. The European Commission’s European Affordable Housing Plan aims to increase the supply of affordable, sustainable and quality housing, while its proposed Affordable Housing Act will provide a framework for authorities to respond to housing pressures, including those linked to short-term rentals.
City leaders have welcomed these ambitions but have warned that cities must retain the powers and flexibility to respond to local housing pressures. This includes protecting neighbourhood liveability and ensuring that investment and regeneration do not come at the expense of existing communities.
As Elena Montani, Head of New European Bauhaus at the European Commission’s Joint Research Centre, emphasised, “Displacement is not an unavoidable consequence of regeneration.”
She highlighted how New European Bauhaus projects combine sustainability, inclusion and quality of life, with a focus on renovating and repurposing existing buildings rather than demolishing them. In 2026, the New European Bauhaus prizes were awarded to a range of innovative projects and ideas.
Crucially, she stressed the need to protect affordable housing from the planning stage, ensuring that improvements benefit existing communities.
Making European investment work for residents
While cities are developing new approaches, turning individual projects into long-term neighbourhood strategies requires sustained investment and supportive European policies. With negotiations on the next seven-year EU budget at a crucial stage, ensuring that EU funding supports affordable housing and inclusive regeneration is becoming increasingly important.
Spanish MEP Marcos Ros Sempere outlined EU proposals to dedicate at least 13% of European Regional Development Fund resources to sustainable urban development, alongside a proposed 10% allocation for housing.
Cities must continue to grow and improve, but never at the expense of the people who call them home.
He also highlighted proposed safeguards to prevent publicly funded home renovations from contributing to speculation, including restrictions on selling properties or changing their use for ten years.
However, Ros Sempere warned that investment in buildings and infrastructure alone cannot guarantee successful regeneration. “If we only do the physical part, we have a serious risk of gentrification and of expelling the inhabitants of the neighbourhood to other parts of the city,” he said.
The wider importance of affordable housing was also highlighted by Paula Letunić, Deputy Permanent Representative of Croatia to the EU, who linked housing to demographic change, economic competitiveness and the ability of young people and families to remain in their communities.
“Affordable housing is not just another social expenditure. It’s a strategic investment in our demographic future, social cohesion and Europe’s long-term competitiveness,” she stated.
Giving cities the tools to deliver
Alongside investment, cities need clear rules, sufficient resources and practical support to manage the complex process of neighbourhood regeneration.
Francesco Amodeo, Senior Policy Advisor in the European Commission’s Housing Task Force, highlighted several challenges facing local authorities, including fragmented responsibilities, limited data and funding programmes that do not match the long-term nature of neighbourhood regeneration.
The EU’s forthcoming Housing Simplification Package, expected in 2027, could help cities address some of these challenges by reducing unnecessary administrative burdens and making it easier to deliver housing and regeneration projects.
Simplification is not only deregulation. It also means providing local authorities with the structures, resources and capacity needed to implement policies effectively.
However, simpler procedures must not come at the expense of community participation, environmental protections or safeguards against displacement. “Simplification is not only deregulation,” Amodeo explained. “It also means providing local authorities with the structures, resources and capacity needed to implement policies effectively.”
Turning neighbourhood experience into European action
The discussions in Brussels will help shape NEBwork’s activities in the coming years. Through Local Housing Action Labs, the project will bring together residents, local authorities, community organisations and researchers to develop regeneration strategies that combine affordable housing, environmental sustainability and social inclusion.
Coordinated by Zagreb, with Eurocities among its partners, NEBwork will draw on the experiences of its 17 neighbourhoods to develop practical regeneration strategies, knowledge-sharing tools and policy recommendations that other European cities can adapt to their own circumstances.
The aim is also to bring lessons from neighbourhoods into European policymaking, helping ensure that future EU housing policies and investment programmes respond to the challenges facing cities and their residents.
As André Sobczak, Secretary General of Eurocities, emphasised: “Ultimately, the project will show that successful regeneration is not just about creating better places. It is about making sure the people who already live there can share in the benefits.”
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NEBwork is an EU-funded project bringing together 17 neighbourhoods across six European cities: Athens, Barcelona, Florence, Ghent, Lyon and Zagreb. Inspired by the principles of the New European Bauhaus, the project aims to develop new approaches to urban regeneration that make neighbourhoods greener, more sustainable and liveable while preventing gentrification and the displacement of existing residents.
Through Local Housing Action Labs, cities will work with residents, community organisations, researchers and other stakeholders to develop practical solutions that combine affordable housing, environmental sustainability and social inclusion. Coordinated by Zagreb, with Eurocities among its partners, NEBwork will share lessons between cities and develop policy recommendations to help shape future European housing and urban regeneration policies.
