Many countries and cities in the world have problems with housing shortages - despite the fact that all people must have access to affordable and safe housing by 2030 at the latest, according to the global goals. Photo: Agnes Fältman.

FUF-correspondents, Report

Vienna shows the way forward in the global housing shortage

According to Agenda 2030, all people must have access to affordable and safe housing by 2030 at the latest, something that cities around the world are fighting hard to achieve. Vienna has long been considered one of the cities in the world with the highest standard of living. This is partly due to the city's unique system of low-cost municipal tenancies, which today house more than half of the residents. How has Vienna managed to do what so many other cities around the world have not? 

Austria's capital Vienna has been named the city in the world with the highest standard of living ten years in a row, among other things in comparative studies carried out by the Economist Intelligence Unit and Mercer. One reason the city consistently tops the charts is its unique rental system. These are called Gemeindewohnungen - "shared apartments" in Swedish.

The municipal tenancies house in day a quarter of the city's 1,9 million inhabitants, and together with other municipally subsidized tenancies they house half of the inhabitants, according to Municipality of Vienna. The large range of cheap apartments is compatible with the UN's 17 global development goals - that all people should have access to safe and affordable housing by 2030 at the latest.

In a time of inflation and economic decline, the cost of living is rising for many people around the world, and it is becoming more difficult for states and cities to guarantee their citizens the right to adequate and affordable housing. The global situation of young people are particularly vulnerable, as the economic situation makes it significantly more difficult for them to buy their first home. They are also tormented by heavily increased rents in urban environments.

Vienna has experience with housing crises. Therefore, for more than a hundred years, politicians have worked hard to achieve a more stable housing and rental market, not least for young people.

A historic project

Around the turn of the century in 1900, approximately 300 of the city's 000 million inhabitants had no access to proper housing. The housing situation was reputed to be one of the worst in Europe, and the social democratic politicians in Vienna realized after the First World War that the situation needed to change drastically. In 2, the first "Gemeindebau" project was built, and within 1923 years, 10 new apartments had already been built, according to Municipality of Vienna.

The homes were built throughout the city, regardless of the median income or reputation of the different residential areas. The guidelines for the huge project were that all apartments should be of high quality, promote social community and contribute to socially and culturally mixed areas.

This is clearly felt even today. The typical architecture of the residences has become an iconic part of Vienna's appearance, as the houses are found in every district, on almost every street. They are well-planned houses with red roofs, distinctive chimneys and roof aerials, large inviting courtyards filled with playgrounds and green areas with benches in the sun.

Housing complex built by Gemeinde Wien in the years 1930 – 1931. Photo: Agnes Fältman.

- Decent apartments have become a luxury item in many cities. Vienna has deliberately chosen a different path. For over 100 years, we have viewed access to affordable housing as a public responsibility, best met by a strong public housing sector, says Kathrin Gaál, Deputy Mayor and Municipal Housing Council of Vienna.

Continued municipal and state investments of approx 400 million euros per year in today's money value has led to approximately 7 new apartments being built and approximately 000 older ones renovated in Vienna each year, which has kept rents low and stable. An average municipal rental apartment costs today 5,81 € per square meter per month, excluding tax and operating costs. In 2020, only 11 people queued for public housing in Vienna, according to Kronen Zeitung.

Housing shortage – a global problem

The situation in Vienna stands in stark contrast to the housing situation in other countries in the world, for example India - which has major problems in the housing sector. This is due, among other things, to the rapid economic development with heavy urbanization as a result. The housing shortage was estimated in the years 2012 to 2017 to be approx 18,78 million homes.

In 2011, it was estimated that around 13 million Indian households lived in slums, many due to their inability to afford the increased rents in urban settings. The standard of living was and is significantly lower in these areas, for example had 71 percent of the areas no access to proper drainage. The threat of eviction is also ever-present. Between 2017 and 2019, approximately 320 people were evicted from these areas, among other things to make way for new government housing projects and to "beautify" the neighborhoods. The large housing shortage naturally also affects young people to a large extent, as it huge demand making it even more difficult for them to find housing.

In other countries such as Spain, young people are forced to pay up to 94 percent of their salary to rent your own apartment. In Hong Kong, it is estimated that about 250 people, among them more than 50 young people, live in cage-like "rooms" of a few measly square meters due to the city's sky-high rents and insufficient wages, according to South China Morning Post.

There are also major problems in the housing sector in Sweden, for example in Stockholm. According to SCB are only 44 percent of all housing rental properties and over 700 people are currently in the queue to get a rental property in Stockholm County. The average queue time for a first hand contract in the inner city is 18 years, which has given way to a large second-hand black market. Second-hand rents are average in the city of Stockholm 149 percent higher than the first-hand rent, according to the Stockholm Chamber of Commerce.

“It's really about luck”

Lara Maltrovsky, 25, works as a consultant and has lived in Vienna all her life. When we talk on the phone, she tells us that she has never lived in a Gemeindewohnung, i.e. a municipal tenancy. She describes that she found her first accommodation in a different way, as it took time to apply and wait for a tenancy through the municipality, on average it takes one and a half year. She explains that it can work well for young people who can stay at home for a while, but that for others, waiting for their first apartment within the city's queue system is not an option in practice.

- I cannot say how fair the system is. Due to the standardized nature of the system, it really comes down to luck – how quickly they can come up with an offer and whether you actually like the apartments they offer.

Large green areas play a key role in the design of residential complexes. Photo: Agnes Fältman.

Lara Maltrovsky also explains that there are some requirement to be able to get rent from the city. These are a minimum age of 17, having been resident and registered at the same address in Vienna for at least two years, being an Austrian or EU citizen, as well as an upper income limit of 3,810 euros per month.

- At the same time, I think it is a very good service from the city because renting a Gemeindewohnung is significantly cheaper than renting on the private market, and it increases the number of affordable housing areas, Lara Maltrovsky says.

In addition to the waiting time, there are other downsides to the system. Lara Maltrovsky tells us that the apartments and contracts inherited by relatives and relatives if the tenant leaves. Siblings, partners, grandchildren, step-siblings – the list is long of those who have the right to inherit. This, Lara Maltrovsky believes, leads to many municipal rental apartments staying in the same families for generations, as the leases are unlimited in time. This limits access for other people in need, not least young people who are taking their first steps into the rental market.

- I know it's illegal, but many people I know have given their Gemeindewohnung to someone else in the family or an acquaintance without making it 'official', says Lara Maltrovsky.

Despite this, it can be stated that Vienna has succeeded better than many other cities in guaranteeing its residents decent and affordable housing, in accordance with Agenda 2030. How the rest of the world will overcome its problems, especially for its young, remains to be seen.

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