How Vienna Implements the 5 Pillars of Housing: Produce, Preserve, Protect, Prevent, Promote
Introduction:
The 5Ps framework, developed by the Global Policy Leadership Academy, is a tool to facilitate discussions about the range of policies and programs that encompass a comprehensive response to the demand for more affordable homes with access to resources that support thriving communities. The Global Policy Leadership Academy has mapped the core elements of the Vienna Social Housing Model to the 5Ps Housing Policy Framework to foster a shared understanding of how Vienna’s policies and programs work together to create a stable housing system.
Active Role of Government:
The City of Vienna takes an active role in acquiring, funding, regulating, managing, and incentivizing housing development. Because they build enough affordable housing to meet local demand, more than 60% of the city’s 1.8 million inhabitants live in subsidized housing (limited profit and municipal housing).
Permanent Source of Funding:
Vienna’s social housing system is supported by a 1% tax on the salaries of all Viennese residents. Half of this tax is paid directly from each person’s wages, and the other half is paid by their employer. This tax generates about $240 million annually. The City of Vienna also receives about $200 million annually in loan repayments, ground lease repayments, and rental income from the housing stock that is owned by the public sector. In total, approximately $440 million is generated annually for public sector use related to housing initiatives.
Mobilize Land for Housing:
The City of Vienna acquires sufficient land for 15 years of anticipated residential development through Wohnfonds Wien, a quasi-governmental nonprofit corporation. This corporation is governed by a trust, which is chaired by the city council and regulated by the public sector.
Rent to Purchase:
Some subsidized condominiums, cooperative housing, and renters within LPHA rental properties have the right to purchase their units after 10 years of occupancy. Additionally, accessible low-interest loan products are available through private-sector banks to cover equity contributions for LPHA units.
Social Housing includes the Middle Class:
High income limits of approximately 180% AMI of the median income are at the heart of Vienna’s social housing approach. By creating broad income targets and requiring a mix of incomes in every community (and in most developments), Vienna has built broad-based support for social housing. Some researchers agree that Vienna’s moderate-income social housing stock dampens rent levels in market rate housing
Permanent Affordability:
By law, most subsidized housing in Vienna is permanently affordable with no mechanism to be converted to market rate housing. Municipal housing remains affordable by virtue of public ownership, while LPHAs are restricted from taking excess profits on property in perpetuity.
Municipal Housing Stock:
Vienna’s city government owns and manages 220,000 housing units, which represent about 23% of the city’s housing stock. These city-owned housing units have been the primary source of affordable housing for Vienna’s lower-income residents since the 1920s. Although many cities in central and eastern Europe have privatized their municipal housing stock in the past 40 years, Vienna chose to maintain public ownership of its municipal housing stock.
Gentle Urban Renewal:
Funded by the City of Vienna, the Gentle Urban Renewal Program preserves the quality of Vienna’s affordable housing stock and ensures that people are not displaced because of low-quality standards and increases in housing costs due to rehabilitation investments.
Maintaining Housing Stability:
The City of Vienna provides strong legal protections for all residents of social housing as well as most residents of private property in the following ways:
• Rent Control was first established in 1917 to protect widows and orphans of soldiers killed in World War I from exorbitant rent hikes.
• Open-Ended Leases mean that tenancy agreements do not have expiration dates.
• Just Cause Eviction Protections limit the reasons (e.g., non-payment of rent) that property owners can use to terminate lease agreements. Terminations are managed through the court system.
• Right of Inheritance/Transfer allows households to transfer a unit to their heirs or to a qualified transferee.
Conclusion:
In 2020, the City of Vienna adopted a Smart City Strategy to reach climate neutrality by 2040. This plan includes a combination of climate and social goals and aims to transform all the municipality’s systems (e.g., mobility, energy supply, green spaces, housing) while also providing enough high-quality housing to reduce the size of the rent-burdened population. To achieve these goals, the plan employed strategies such as establishing a city-wide greenhouse gas (GHG) budget, against which the GHG emissions of its housing stock can be measured.