Housing | Political decision-makers begin to reshape the city’s housing policy

Helsinki update its housing policy guidelines. A new program for housing and related land use, or the so-called AM program, is coming to decision-making.

The guidelines of the AM program may be visible to city dwellers in the future as an increase in additional construction, regulation of the minimum size of the smallest apartments, and a new type of opportunity to acquire an owner-occupied apartment.

The draft program prepared by the office holders will be discussed in the city council on Monday. At that time, the political negotiations regarding the program also begin, where the content of the program may still change.

According to the city, the focus of the program drawn up for the years 2024–2027 is socially sustainable housing production and the prevention of segregation, i.e. regional differentiation.

The expensiveness of housing also comes to the fore: If a reasonable upper limit for housing costs is set at 40 percent of income, only a good fifth of Helsinki’s housing costs remain within reasonable limits.

Helsinki the city is preparing to reduce the housing production target by a thousand apartments. In recent years, the goal of housing construction has been 8,000 new apartments per year, and last year we reached that goal.

Now the bottom of the housing market and the uncertainty of housing construction have caused the city to choose a more cautious line.

In addition to market uncertainty, the presentation drawn up by city officials states that the current government’s neoliberal and more selective housing policy means that the role of growing cities in solving housing issues is emphasized.

In the new The AM program highlights, for example, the situation of right-of-occupancy housing. The decision-makers in Helsinki had previously planned that a housing rights model falling between rental and owner-occupied housing would replace the abandonment of slow construction.

Petteri Orpon However, the (kok) government decided that interest subsidy loans will no longer be granted for housing rights production. This practically overturned the city’s plans to replace the slow one with housing rights production.

At the end of last year, almost 800 right-of-occupancy apartments were under construction in Helsinki, and more than 1,800 construction projects for right-of-occupancy apartments were pending. Some of the projects were stopped due to the government’s decision. Plots in front of around 1,600 apartments were also reserved for housing right production.

The AM program highlights the city’s concern that, due to housing price developments, younger generations will find it increasingly difficult to get hold of owner-occupied housing. In addition to the price development, there is concern about the apartments ending up as investors and then as rental apartments.

In the draft of the AM program, it is proposed that the city could use a clause in the land conditions for self-financed owner-occupied apartments, according to which the apartments would only be sold to natural persons. Investment companies would be cut out.

Slow down as a replacement, a new type of model is now presented, in which the resident would have the opportunity to redeem his rental apartment as a home after ten years of living there. A condition for renting would be a small capital. However, this model would not be sufficient to cover all the slow production that is ending.

The AM program also deals with renting apartments.

In January 2024, there were approximately 6,800 freely financed rental apartments available in the city, which is four times the number compared to four years ago.

In the draft of the AM program, the annual construction target of price-regulated ARA rental apartments is one fifth of all completed apartments.

This may still be a problem in the finalization phase, because in the preparation phase in the urban environment committee, the coalition proposed that the amount of ARA production be reduced. The left, on the other hand, wants to raise it.

In the program the shrinking of apartments is also highlighted. The share of studios and one-bedroom apartments in the annual housing production is 60 percent, and the size of the apartments is decreasing every year.

The city plans to continue the model that has been in use since 2012, which requires the construction of family apartments the most. It is planned to start regulating the surface area of ​​the studios on a project-by-project basis so that the average surface area of ​​the studios in the buildings should be at least 32 square meters.

The coalition will probably oppose the regulation of the sizes of studio apartments beyond the minimum area of ​​20 square meters. 20 square meters is the limit set by the Ministry of the Environment.

Helsinki the population is predicted to grow to 700,000 by the end of 2027. Among those moving to Helsinki, those from abroad and young people stand out. The middle-aged, on the other hand, are moving out of the city.

An attempt is made to prevent the differentiation of regions with strong political guidance. For example, regionally, the number of rental apartments is limited so that there are no rental apartments more than 50 percent of the housing stock.

This can also be seen in directing construction to the suburbs.

Instead of new residential areas, the focus of construction in the new program is to be shifted to the suburban zone. The goal is that more than half of the completed areas would be supplementary construction to already existing residential areas.