This paper researches the impacts of the housing problem of younger population on the demographic trends in the city of Zagreb. Housing problems in the city of Zagreb are marked by an increase of housing prices and rents, mainly in the uncontrolled market, and they differ from other parts of the country. In the context of the challenges of housing policy development in transition countries, the housing standard, housing tenure, the housing market and the rental housing market in Zagreb are analysed. Regarding the research methodology, the paper is based on a survey, analysis of statistical data and other, relatively scarce literature. The analysis of the housing market and the uncontrolled housing rental market speaks of the key problem of housing affordability. Social programs in this area are residual in nature and do not provide housing for vulnerable groups. An important contribution of the paper is a survey in the population aged 18 to 39 years. The results of the research show that less educated immigrants who come to Zagreb for employment cannot afford decent housing. The unsustainable status of tenants in the uncontrolled private market makes this population socially excluded. The affordability of decent housing mediated by financial problems and other factors has negative effects on childbearing. In addition, such forms of social deprivation are proving to be triggers for emigration from the country. Certain methodological innovations are proposed for future research in this area. In addition to the negative effects on demographic trends, the unaffordability of decent housing also affects labour mobility, and thus the social and economic development of the city of Zagreb. Key words: housing, housing policy, affordable housing, demographic renewal, Zagreb