This paper provides an overview of the restructuring processes in the East-Central European countries during the transition to a market economy and defines the critical bottlenecks to housing and related urban development that still exist. Topics covered include understanding the Eastern European housing sector; performance of the housing model at the end of the 1980s; the housing sector in transition; a mid-transition evaluation; principles and priorities for continued transition; the role of international institutions; and the use of sectoral performance indicators.