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.