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# [REUNION ISLAND] Social Housing Crisis: State Funding Cut by 65%, Landlords Sound the Alarm
- URL: https://businessoi.media/en/la-reunion-logement-social-le-financement-lbu-divise-par-3-les-bailleurs-en-etat-durgence-en/
- Published: 2026-09-10T08:42:31.000Z
- Updated: 2026-09-10T08:42:31.000Z
- Description: LBU funding falls to €27M in 2026 versus €85M in 2024, a 65% drop. With 53,000 applications pending and 1,832 units stalled, Réunion's social housing sector is sounding the alarm.
- Author: Emmanuel TAOCHY
- Tags: La Réunion, Économie, emploi, Flash de mi-journée, #en

Social housing organizations in Réunion Island are raising the alarm. The Ligne Budgétaire Unique (LBU) — the main source of public funding for social housing on the island — has collapsed to **€27 million** in 2026, down from €78.5 million in 2025 and €85 million in 2024\. That is a fall of nearly **65%** in a single year, which the ARMOS-OI (Réunion's association of social housing landlords) describes as « totalement incompatible avec les besoins du territoire » — totally incompatible with the island's needs.

### 53,000 applicants waiting

As of March 31, 2026, Réunion Island had **53,000 social housing applications** on its waiting list. At the same time, 55 new-build operations totalling **1,832 units** — including 636 very social rental units — and 12 renovation projects covering **1,162 existing homes** are shovel-ready but require roughly €70 million in LBU credits to proceed. With only €27 million available, virtually all of these projects are on hold.

### A construction sector under stress

The fallout goes beyond housing alone. In 2024, social housing accounted for **54% of all public procurement** in the local construction industry. Such an abrupt withdrawal of state funding will mechanically translate — according to sector professionals — into fewer construction starts from 2027 onwards, longer waiting lists and financial pressure on local building firms.

### Why it matters

With an estimated 150,000 people poorly or inadequately housed and a still-dynamic population, Réunion is grappling with a structural housing crisis that a collapse in national funding risks deepening for years. ARMOS-OI is calling for an emergency restoration of LBU allocations and is pressing government decision-makers ahead of the final state budget arbitrations. Without a swift response, 2027 looks set to be a breaking point for the sector.