Vienna’s Housing Renaissance: How Social Equality Became the Model


Vienna public housing

In a world where housing has become a nightmare of expense and speculation, Vienna stands out as a beacon of hope for renters.

With 80% of residents qualifying for public housing, Vienna has largely avoided the housing crisis that has plagued other cities around the world.

Public Housing in Vienna

Vienna’s public housing system is unique in that once you have a contract, it never expires, even if you get richer.

This means that residents can stay in their homes for as long as they want, regardless of their income level.

This is in stark contrast to other cities where public housing is often seen as a temporary solution for those in need.

The city’s housing system is also insulated from the market so rental prices reflect costs or rates set by law, not inflationary market prices.

This has resulted in affordable housing for the majority of residents, with 80% of all households in Vienna choosing to rent versus buy.

The Vienna Model

Vienna’s success in providing affordable housing is due to its unique approach to establishing policies.

The city prioritizes subsidizing construction, rather than subsidizing people, with things like tax credits or vouchers.

Vienna’s system is not just for poor people—many middle-class residents choose to live in public housing because of the stability it provides.

As a result, public housing is not stigmatized like it is in other cities.

The system is unique and complex, relying on two different forms of public housing, rent controls, other landlord-tenant regulations, and rental subsidies.

At a Glance: How it Works

Vienna’s highly effective and renowned affordable public housing system is known for several key aspects, including:

  • A legacy of giving high priority to providing high-quality housing for the working-class dates back to the “Red Vienna” period of the early 20th century.
  • Poor and middle-class residents alike choose to live in public housing because of the stability it provides.
  • It’s insulated from the market, meaning that rental prices reflect costs or rates set by law, not “what the market will bear.”
  • It relies on two forms of public housing: rent controls, landlord-tenant regulations, and rental subsidies.
  • It’s made up of two types of public housing: municipal housing estates and social housing.
  • Social housing units are meant to be primarily for lower-income residents, must meet certain standards, and are actually placed in desirable areas.
  • The city also indirectly controls 200,000 social housing units that are built and owned by limited-profit private developers but developed through a city-regulated process.
  • It prioritizes subsidizing construction, rather than subsidizing people, with things like tax credits or vouchers.
  • Its municipal housing estates are owned and managed by the city and are home to close to half a million citizens.
  • It’s available to people of all incomes and is often built on government-owned land that’s sold to a private company, which then owns and operates the housing units under public oversight.
  • Vienna builds thousands of new social housing units each year, ensuring that supply keeps up with demand.
  • Today, social housing accounts for an estimated 40% of the housing stock in Vienna.

Impact on Residents

In addition to ensuring a large number of people have access to affordable housing, Vienna’s unique system has had a significant impact on the development and functioning of the city in several ways overall.

High-Quality: Vienna’s system of social housing has resulted in buildings and units that are attractive and well-maintained—which has helped prevent the estates from becoming social ghettos.

Tenant Control: Vienna’s model prioritizes tenant control, with residents having a say in the management of the housing and the setting of rents.  Additionally, the longer residents live in their apartments, the lower their rent gets, giving them a sense of control over their housing situation and allowing them to plan for the future.

Spread Throughout the City: Vienna’s social housing is spread throughout the city, including in touristy areas, to prevent the concentration of poverty or the formation of ghettos. The homes are located near schools, transit, and cultural amenities, making them desirable places to live.

Mixed-Income Housing: Vienna’s model includes mixed-income housing, with affluent Viennese sharing walls with working-class residents which has helped prevent the stigmatization of social housing and has also created more diverse communities.

How it Stacks Up to Others in Europe

European Public Housing

Although Vienna’s public housing model is often held up as a utopian blueprint for other cities, there are other models of social housing in Europe that differ in their approach.

The Dutch Model

The system of public housing in The Netherlands is based on the principle of “wooncooperaties,” or housing cooperatives.

These cooperatives are owned and managed by the residents themselves, who have a say in the management of the housing and the setting of rents.

The Dutch model is unique in that it emphasizes the importance of resident control and participation.

By contrast, Vienna’s social housing units are primarily owned and managed by the city, with residents having less control over the management of the housing.

The French Model

Social housing in France is based on the principle of “HLM,” or “habitations à loyer modéré,” which translates to “low-rent housing.”

The French model is unique in that it is primarily funded by the government, with private developers playing a smaller role.

It’s also unique in that it is intended primarily for low-income residents, with strict eligibility criteria.

Conversely, Vienna’s model is intended for the working class and to some extent the middle class, with less strict eligibility criteria.

The German Model

Public housing in Germany is based on the principle of “Wohnungsgenossenschaften,” or housing cooperatives.

These cooperatives are owned and managed by the residents, who have a say in the housing management and the setting of rents.

The German model is unique in that it emphasizes the importance of resident control and participation, similar to the Dutch model.

That’s a stark contrast to Vienna’s social housing which is primarily owned and managed by the city, with residents having less control over the management.

The British Model

Social housing in the U.K. is based on the principle of “council housing,” which is owned and managed by local councils.

The British model is unique in that it is intended primarily for low-income residents, with strict eligibility criteria.

The U.K.’s system has been criticized for its lack of investment in social housing, which has led to a shortage of affordable housing.

Contrast that to Vienna’s model which prioritizes subsidizing construction, rather than relying on market forces, with things like tax credits or vouchers.

Lessons Learned

Vienna’s public housing system has been undeniably successful in providing affordable housing for its residents; however, it’s important to note that this model may not work in other cities as Vienna’s success is due in part to its unique history and political climate.

That being said, there are definitely valuable lessons that other cities can learn from the Viennese approach to housing policy.

Prioritizing the construction of inexpensive housing, rather than relying on market forces, definitely helps ensure that everyone has access to a safe and affordable place to live.

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The views expressed in this article are not to be construed as personal advice. You should contact a qualified and ideally regulated adviser in order to obtain up to date personal advice with regard to your own personal circumstances. If you do not then you are acting under your own authority and deemed “execution only”. The author does not accept any liability for people acting without personalised advice, who base a decision on views expressed in this generic article. Where this article is dated then it is based on legislation as of the date. Legislation changes but articles are rarely updated, although sometimes a new article is written; so, please check for later articles or changes in legislation on official government websites, as this article should not be relied on in isolation.

“About

Chris Lean

Chris is a Chartered Financial Planner who writes blogs and articles to simplify and explain some of the financial issues that affect UK expats. Subjects include; hot topics, regulation and the ever-changing world of finance.

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