Quality: 4 - País

Tenant’s democracy in Denmark

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Tenant’s democracy in Denmark

Policies and regulations Building capacity Participatory processes
Promotion and production Self-management

Main objectives of the project

In numerous European countries, social housing landlords have established mechanisms for tenant involvement in governance, with Denmark leading the forefront in this domain, where it has evolved into what is commonly referred to as "tenant democracy." Within this system, tenants of housing associations possess the ability to wield substantial influence over estate management.

Date

Stakeholders

  • Promotor: BL- Danish Federation of Non-Profit Housing

Location

Continent: Europe
Country/Region: Denmark

Description

Denmark boasts a rich history of equitable housing policies spanning over a century. In 1919, through broad political consensus, Denmark pioneered a national public social housing system accessible to all. Unlike public housing models elsewhere, social housing in Denmark is not confined to low-income households but is open to all residents. Nonprofit housing organizations, where tenants are associates, develop and own the buildings, while residents actively shape their living conditions through a system of tenant democracy. Regulated extensively under Danish welfare policy, nonprofit housing development encompasses stringent controls over financing, design, construction, and management, including waiting lists for housing units. Danish law allows each municipality to allocate up to 25% of its social housing stock for marginalized communities such as refugees, the unemployed, and people with disabilities. Social housing comprises approximately 20% of Copenhagen's housing stock, while market-rate rentals and private co-ops constitute 43% and another significant portion, respectively.

A cornerstone of tenant democracy in Denmark lies in tenant boards. Each housing estate annually elects its tenant board, which subsequently forms part of a larger assembly. This assembly convenes annually to elect a board, approve budgets and rents, determine maintenance and renovation projects, and establish local rules. Tenants hold substantial power in decision-making, with the board having the final say, even on major renovations. Disputes are resolved through municipal assistance mechanisms when necessary, ensuring equitable outcomes. While tenants maintain the majority on the organization's board, municipal representatives often occupy seats as well. Thus, participatory methods, reinforcing local power and horizontal governance are the main features of the model.

To further empower tenant boards, housing associations offer various tools and resources. These include dedicated web portals for board members and a range of courses, such as an annual weekend seminar for local housing company chairpersons and chairwomen, along with meetings held in local settings with high-level executives from the housing associations.

Links

Authors:

CSCAE Consejo Superior de los Colegios de Arquitectos de España

Swedish Tenants’ Union

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Swedish Tenants’ Union

Mismatches Price
Policies and regulations National policies Regulation Building capacity Price control
Ownership and tenure Protection of social housing

Main objectives of the project

In most countries globally, rent prices are primarily dictated by market forces. However, Sweden, shaped by its history of progressive ideals and left-leaning governance, has upheld a unique rent model grounded in the concept of "use-value." Here, rent isn't subject to market fluctuations but rather negotiated between landlords and tenants, taking into account the specific attributes of the property. This system stems from a longstanding regulatory approach in Sweden that treats all rental housing equally, regardless of form or tenure.

Date

Stakeholders

  • Hyresgäst­föreningen

Location

Continent: Europe
Country/Region: Sweden

Description

In the housing sector, a significant challenge arises from the unequal distribution of power and information among stakeholders, leaving tenants particularly vulnerable in an imperfect market environment. This concern prompted Sweden to organize tenants into mass grassroots unions as early as the 19th century. The primary objective was to enable tenants to negotiate rent and housing conditions with property owners. Following the establishment of the welfare state, the methodologies of negotiation developed by these Tenant Unions were formalized into law.

Presently, all tenants in Sweden, regardless of whether housing is provided for profit or not, possess the right to participate in negotiating rents and tenancy conditions. This right is reinforced by tenant mobilization and active campaigns advocating for tenant rights. With a membership of 500,000 individuals, the Tenants' Association has not only become one of Sweden's largest grassroots movements but also the world's largest tenants' association. The Association, alongside representatives of landlords, engages in negotiating tenancy agreements. In instances where landlords refuse to negotiate with tenants, a statutory Rent Tribunal holds the authority to impose arrangements regarding rent levels and tenancy conditions.

Currently, the largest tenant union negotiates rents for three million tenants residing in 1.5 million apartments. These apartments are situated across 300 municipal housing associations and 45,000 private rental properties. Approximately 4,000 elected members participate in rent negotiations.

The system mirrors the process by which wages are determined in Sweden, characterized by broad sector-based negotiations between organized labor and employers' organizations. This system operates on the principle of "bruksvärde," or "use-value," which aims to both model market rents and ensure fixed tenure and reasonable rents for tenants. Rent is established based on various factors including the size, design, location, and physical condition of the apartment in question.

In addition to negotiations, the Tenant's Union advocates for policy innovations such as rent regulations for housing in the free market and the promotion of cooperatives or social housing.

Links

Authors:

CSCAE Consejo Superior de los Colegios de Arquitectos de España

“Mietpreisbremse” and “Mietendeckel”: Rent regulation system in Germany

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“Mietpreisbremse” and “Mietendeckel”: Rent regulation system in Germany

Mismatches Price
Policies and regulations Price control

Main objectives of the project

Germany, particularly Berlin, faces a significant challenge regarding its rental sector, which plays a crucial role in the city's housing supply. Unfortunately, it has transformed into a speculative market, resulting in forced evictions and a diminished quality of life for millions of Germans. Consequently, Germany has implemented some of the most stringent rent control laws in an attempt to address this issue. Examining the evolution of these regulations provides insight into their impact on affordable housing.

Date

  • 2015: Implementation
  • 2019: Implementation

Stakeholders

  • German Federal Government

Location

Continent: Europe
City: Berlin
Country/Region: Berlin, Germany

Description

Germany is renowned for its extensive rental sector, offering tenants secure tenancies and protection from eviction, making renting an appealing option compared to home ownership. Since the 1970s, a system has linked rent increases to a reference rent for similar-quality local dwellings, updated regularly, usually every four years. A database known as the Mietspiegel provides a nationwide benchmark for tenants and landlords to index rents. However, due to the pressure of rising rents, the Federal Government introduced an even more restrictive law in 2015.

The law, known as the Mietpreisbremse (Rent Control), is a nationwide regulation that took effect in 2015. It mandates the maximum amount of rent a landlord can charge. According to the law, the net cold rent may not exceed 10 percent above the local comparative rent, as set out in the regional rent index. If the landlord charges more than the permitted rent, the tenant is entitled to a rent reduction.

In principle, the Mietpreisbremse applies to tenants living in areas with tight housing markets and to federal states that have implemented corresponding regulations. Besides Berlin, Hamburg, and Munich, many other medium-sized to large cities in Germany are also covered by this regulation. All rental properties are subject to the regulation, with some exceptions, such as newly listed apartments (to encourage new housing supply) or apartments renovated for energy efficiency or necessary modernization.

In 2020, Berlin implemented an additional rent price regulation, the Mietendeckel. This cap prevented owners of flats built before 2014 from charging more than what had been agreed upon in June 2019, effectively freezing all rents. It also stipulated that rents exceeding acceptable levels by 20% should be reduced, varying based on location and quality. Landlords failing to comply with the new law faced heavy fines. The policy was intended to be in place for five years. Unlike the Mietpreisbremse, which sets a limit on rent increases, the rent cap froze rents and utilized a more restrictive index. With Berlin’s law, no increase were possible. Not even a 10%. This measure meant that hundreds of thousands of households were eligible for significantly lower rents, countering the skyrocketing rents of recent years and preventing speculators from buying buildings solely for rent gouging. However, the court ruled that Berlin, as a state in the German federal system, lacked the constitutional authority to impose the cap.

Following the ruling, the Mietpreisbremse was revised to achieve a similar effect to the Mietendeckel. It now protects tenants in Berlin affected by the invalidated regulation by giving the Mietpreisbremse a retroactive effect. Tenants whose tenancies began after April 2020 can reclaim up to 30 months' worth of excess rent paid. Meanwhile, the German government is working to extend Rent Control until 2025.

Both experiences serve as examples of regulations with mixed effects on the rental market. While prices continue to rise, many Berliners and Germans have been able to reduce their rent. Germany offers a broad range of regulations to be tested in the future to determine how cities can lower or control rents.

Links

Authors:

CSCAE Consejo Superior de los Colegios de Arquitectos de España

Landsbyggefonden – the Danish national fund for non-profit housing

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Landsbyggefonden – the Danish national fund for non-profit housing

Policies and regulations National policies
Financing Financial actors Mortgage systems Public funding Progressive financing

Main objectives of the project

Denmark boasts a rich history of social housing, characterized by a unique approach that extends beyond solely catering to low-income individuals. Through a system of non-profit housing organizations, the country has fostered a model of affordable housing accessible to individuals across all income brackets. One of its most notable innovations is the Landsbyggefonden, a fund that facilitates a self-financing model for these non-profits. Once mortgage obligations are fulfilled, tenants' rents contribute to the fund, enabling the construction of new buildings or the implementation of necessary improvements.

Date

  • 1967: Implementation

Stakeholders

  • Landsbyggefonden

Location

Continent: Europe
Country/Region: Denmark

Description

Social housing in Denmark is a fundamental pillar of the country's welfare system, designed to be non-profit and inclusive, fostering a diverse tenant mix for the benefit of individuals and society as a whole. Its primary aim is to provide affordable housing to all those in need. Presently, nearly one million people in Denmark—equivalent to one in six residents—reside in social and affordable housing, comprising approximately 600,000 housing units. Moreover, the proportion of social housing per capita continues to rise.

At the heart of Denmark's affordable and social housing model lies the National Building Fund, known as Landsbyggefonden (LBF). Established in 1967, LBF is instrumental in maintaining high standards of housing stock and enhancing tenant well-being. It also plays a pivotal role in counteracting economic downturns, such as the COVID-19 pandemic recovery efforts. Financed by tenant rents from non-profit housing organizations, LBF supports the expansion of affordable and social housing, as well as the renovation of existing properties.

Under the LBF framework, when mortgage loans for housing construction are repaid, tenants continue paying rents at the same level, with any surplus contributing to the fund as savings. This pooled resource is then utilized to finance the construction of new affordable and social housing units, as well as the refurbishment of existing ones. Such renovations encompass improvements to both interior and exterior spaces, the modernization of buildings to ensure accessibility for the elderly and disabled, and energy efficiency upgrades. Additionally, the fund covers demolition costs in socially vulnerable housing areas and supports infrastructural changes.

LBF serves as a vital mechanism for ensuring self-financing within the social and affordable housing sector, with savings being reinvested to maintain and enhance dwellings and to provide additional housing opportunities. By establishing a closed financial loop, it reduces the government's need to continually invest in new social housing and facilitates long-term planning for housing funding. Furthermore, it helps mitigate disparities in financial strength among various social housing providers and in the development costs of different estates, thereby influencing rental rates to reflect development expenses.

The fundamental goal of the Fund is to foster socially cohesive, safe, and sustainable communities, with a particular emphasis on investing in social activities and reducing rental prices. These endeavors are often organized through local partnerships involving schools, municipalities, or non-governmental organizations, with the aim of promoting employment opportunities and improving educational outcomes for tenants.

Managed by a nine-member board comprising representatives from housing organizations, tenants, and the two largest municipalities in Denmark, the budget of LBF must be approved by the housing minister to ensure effective governance and oversight.

After the success of Denmark, the idea is being used in other countries. In fact, this model is also used in Austria, with the Equity investment funds.

Links

Authors:

CSCAE Consejo Superior de los Colegios de Arquitectos de España

Prêt à impact- the Social and Environmental Impact Loan

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Prêt à impact- the Social and Environmental Impact Loan

Mismatches Financing
Financing Financial actors Sustainable development financing Public-private collaboration

Main objectives of the project

Caisse d'Epargne has introduced the Social and Environmental Impact Loan (Prêt à impact) to bolster the engagement of its real estate and social housing clientele in social and environmental causes. In this initiative, the interest rates of each loan will be linked to the non-financial social or environmental performance of the borrowers, with the potential bonus being directed towards supporting charitable associations.

Date

  • 2020: En proceso

Stakeholders

  • Caisse d'Epargne

Location

Continent: Europe
City: Paris
Country/Region: France, Paris

Description

Caisse d'Epargne, a longstanding private bank in France renowned for its investments in social housing and public sector ventures, aimed to incentivize its clients to adopt more ambitious social and environmental standards in their social housing endeavors. Drawing on these principles of the institution, the initiative introduces an incentive mechanism where social landlords can benefit from an interest rate indexed to their non-financial performance for each loan.

The bank's endorsement extends to both social and environmental criteria, encompassing social inclusion, disability support, aging population care, urban diversity, occupant health, energy efficiency, greenhouse gas emissions reduction, environmentally responsible practices, and sustainable mobility. Performance in each area is assessed through specific indicators. Should the client meet the predefined objectives annually throughout the loan term, they enjoy a rate increase, which they may choose to contribute to a charitable cause. In cases where objectives are not met, the contractual rate applies without penalty. Through this scheme, Caisse d'Epargne aims to recognize and encourage its clients' efforts in reducing their environmental impact and supporting societal causes, fostering more sustainable and responsible project developments.

It is worth noting that Impact Loans are available not only to social housing providers but also to real estate enterprises, with distinct criteria applied. Real estate entities focus on providing healthy and diverse housing options, while social housing emphasizes inclusion. In both cases, affordable housing schemes are fostered.

The inaugural Impact Loan was initiated by Caisse d'Epargne Ile-de-France in partnership with the Regie Immobiliere of the City of Paris, the second-largest social housing provider in Paris. This 25 million euro loan will cater to the needs of the social landlord, enabling it to secure an interest rate increase of 15 basis points by dedicating at least 20% of annually allocated dwellings to a priority population, as per French law. Both parties have agreed to allocate 50% of the bonus amount annually to a social housing foundation.

This scheme is hailed as highly innovative in Europe, notably for integrating non-financial performance into its mechanism. Similar initiatives exist in the Netherlands. Amidst the COVID-19 recovery phase, this French scheme facilitates social housing investment programs under optimal conditions while fostering a profound social commitment.

Links

Authors:

CSCAE Consejo Superior de los Colegios de Arquitectos de España

Circle House

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Circle House

Mismatches Climate change
Promotion and production Public promotion

Main objectives of the project

Circle House represents Denmark's pioneering venture into circular housing, aiming to disseminate knowledge and expertise on circularity principles throughout the construction sector. Positioned as a scalable lighthouse project, it offers a blueprint for sustainable construction within market parameters. Situated in the Lisbjerg Bakke district on the outskirts of Aarhus, Denmark, the project comprises 60 social housing units scheduled for completion in 2023. In 2018, a pilot program was already built on the site.

Date

  • 2018: En proceso
  • 2023: Construction

Stakeholders

  • Constructor: Realdania’s Innovation Program in Construction
  • Promotor: Danish Environmental Protection Agency’s Environmental Technology Development and Demonstration Program
  • Architect: Vandkunsten Architects
  • Architect: Lendager Group
  • Architect: 3XN/GXN

Location

Continent: Europe
Country/Region: Denmark

Description

Beyond its primary function of providing housing, Circle House serves as a showcase for innovative approaches to circular architecture and construction, with the overarching objective of ensuring that 90% of its materials can be reused without any loss of value, thereby advancing sustainability within the industry. The project's buildings are designed to be dismantlable, allowing their structural components to be reused with minimal loss of value. Circle House comprises a variety of building systems that can be assembled, disassembled, and reassembled into other structures while retaining their economic and aesthetic value. It encompasses three typologies: a mix of two- and three-storey terraced houses and 5-storey tower blocks, including approximately 100 m2 of communal facilities. The building density on site ranges from 65% to 80%.

The project is focused on addressing the challenges associated with circular construction, including the renewal of traditional business models and the development of legislation that supports recycling. As a result, Circle House examines value chains, business models, business cases, and regulatory frameworks. The project disseminates its findings and achievements through extensive discussions about circular construction across the industry.

Funding for the project was provided by the Danish Environmental Protection Agency and the philanthropic association Realdania. Additionally, over 30 enterprises from the Danish construction sector, spanning the entire value chain, are involved in the project. The architectural design of the building was conceived by a Collaboration Studio consisting of 3XN/GXN, Lendager Group, and Vandkunsten Architects.

Links

Authors:

CSCAE Consejo Superior de los Colegios de Arquitectos de España

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Mismatches Price Financing Segregation Functional adequacy Vulnerable groups Climate change Pandemics

Main objectives of the project

The focus of the Repair, Reconstruction or Relocation Program (R3 Program) is to provide relief to persons affected by Hurricanes Irma and Maria who still have unmet needs in their residences. Through this Program, fair housing may be affirmatively furthered in accordance with the Fair Housing Act of 1968, as amended, 42 USC 3601 et seq, a federal provision known as the "Fair Housing Act of 1968". Assistance under this Program will be provided in three (3) major categories: repair, reconstruction and relocation. Under the Reconstruction Program, demolition may be an eligible activity, and under the Relocation Program, acquisition and demolition may also be eligible activities.

Date

Stakeholders

Location

Country/Region: Puerto Rico

Description

The national objective of the R3 Program is to benefit low- and moderate-income (LMI) persons whose income is below eighty percent (80%) of the area median family income (AMFI) according to the modified income limits established by the U.S. Department of Housing and Urban Development (HUD) for the CDBG-DR Program in Puerto Rico. Also included are Low and Moderate Income Housing Incentives (LMHI). These are activities and incentives that benefit low- and moderate-income (LMI) families, with the purpose of relocating these families out of the affected floodplain or at-risk area. These activities are also undertaken for the purpose of providing or improving permanent residential structures that, upon completion, will be occupied by low- and moderate-income families.
In addition to achieving the ancillary benefits of community and neighborhood revitalization, promoting resilience and fostering opportunity.
2022 Goals
5,000 Homes completed
1,500 Relocation vouchers
6,500 Cumulative Families Served

Links

Authors:

AHA Affordable Housing Activation

‘Worst Case Housing Needs’ Reports to Congress

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‘Worst Case Housing Needs’ Reports to Congress

Mismatches
Policies and regulations
Promotion and production

Main objectives of the project

Date

Stakeholders

  • U.S. Department of Housing and Urban Development (HUD)

Location

Country/Region: United States of America

Description

The United States has a well-established system for reporting on appropriate national and local data concerning the affordability, adequacy and availability of housing. Housing conditions in 44 metropolitan statistical areas are assessed. This annual report, published every year since 1991 is known as the ‘Worst Case Housing Needs Report’. Evidence of critical housing problems facing low-income households is provided annually to the United States Congress, drawing on the biennial American Housing Survey (AHS) funded by the United States Department of Housing and Urban Development (HUD) and the Census Bureau. This provides evidence on the affordability, availability and adequacy of housing and defines worst case housing needs of renters with very low incomes – below 50 per cent of the area median income (AMI) – who do not receive government housing assistance, and who pay more than one-half of their income for rent, live in severely inadequate conditions, or both. The AHS data are used to geographically map worst case needs by income, race and ethnicity, with specific focus on rental housing. The AHS housing data advises the US Congress on the funding of specific HUD housing assistance programmes but does not necessarily lead to the definition of specific supply targets. The primary focus of the United States Congress has been on funding and targeting assistance rather than supply outcomes. This has influenced the level of support for housing vouchers (see chapter II), which allow eligible households to “shop” for fair market apartments.[1]

The AHS data are rigorously analysed by the Federal Department of Housing and Urban Development in the “Worst Case Housing Needs Report”. This provides Congress, all levels of government and relevant stakeholders with information on locally differentiated housing needs. [2] The evidence from these reports underpins government justifications for public expenditure on affordable housing programs, such as investment in Public Housing programs and Housing Vouchers.[3]

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Authors:

Genesee County Land Bank Authority – Land banking to revitalise distressed areas in the United States

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Genesee County Land Bank Authority – Land banking to revitalise distressed areas in the United States

Mismatches
Financing
Urban Design
Ownership and tenure

Main objectives of the project

Date

Stakeholders

  • Microcredit Foundation HORIZONTI
  • Habitat for Humanity

Location

Continent: North America
Country/Region: United States of America

Description

The Genesee County Land Bank Authority (GCLBA) is an example of a Michigan state land bank.Michigan State has suffered from widespread and long-term abandonment which accelerated following the global financial crisis. Between 2005 and 2015 GCLBA took responsibility for over 14,000 abandoned tax delinquent homes. To determine what to do with all these homes it consulted with the neighbourhoods via a citizen advisory council and outreach officers. This process has built trust with the residents and engaged them in developing solutions. These solutions include not only demolishing unsafe unsightly properties and creating green spaces, but also renovating selected homes and selling them to local tenants for affordable home ownership. Context

In the United States of America (United States), land banking has been used to revitalise economically distressed areas. Their role has become even more important since the global financial crises and subsequent foreclosures. Public land banks acquire distressed, foreclosed or abandoned properties with the intent of redeploying them for more productive use. Rehabilitation and resale regenerates neighbourhoods and increases property tax revenue, and importantly redistributes properties to meet specific community needs, such as affordable housing.

For a guide for establishing a land bank in the United States, see Frank S. Alexander, Land Banks and Land Banking, 2nd ed. (Flint, Michigan, Center for Community Progress, 2015). Available at https://community-wealth.org/sites/clone.community-wealth.org/files/downloads/report-alexander15.pdf.

Results

Home sales were offered to first time home purchasers, under favourable contracts. The average home in 2015 cost only USD 6,500 (approximately EUR 5,500) with monthly payments of USD 200 (about EUR 170) for five years. Purchasers negotiate feasible and sustainable conditions with the land bank to ensure their long-term stability as residents, thus strengthening the community and improving local safety and dignity. Non-governmental not-for-profit organizations such as Habitat for Humanity sometimes act as intermediaries for renovating the homes and finding suitable purchasers.

Links

Authors:

0

Ownership and tenure

Main objectives of the project

Date

Stakeholders

Location

Country/Region: Pakistan

Description

A common approach to housing the poor in Asian cities is to relocate slum households to new multi-storied apartment blocks, often on the periphery of cities. This is often justified on the basis that the only way to achieve suitable densities in urban areas, to match local planning regulations, is to have multi-storied apartment blocks. Houses on individual plots of land are seen as low-density and inappropriate or not possible given local planning regulations. A recently completed conceptual study from Karachi, Pakistan, challenges this prevailing view by highlighting that similar or even higher densities than specified in local planning regulations can be achieved by using an individual terrace house typology. In terms of settlement and building design, this highlights the importance of exploring design options to suit the local conditions and constraints, rather than settling for one building design and repeating it throughout a city or country. 

The experience also demonstrates the opportunity for building and settlement regulations to improve housing affordability. For example, through reducing the size of the plots in Khuda Ki Basti 3 to the lower-end of the regulatory minimum (but still to a size that is comfortable and can accommodate household activities) the cost of a plot reduces from 525 USD to 308 USD, a 41 per cent cost reduction. This also reduces the cost of infrastructure development (water, sewerage, and roads) for each plot by 44 per cent which can reduce the overall cost of each housing unit. While maximising plot area is desired by most urban households, both rich and poor, the fact is that to improve affordability, especially at the lower end of the market, development costs have to be reduced. Modifying planning regulations to facilitate the large-scale provision of land that is affordable for individual households is one important part of improving affordable housing provision.  

Building and planning regulations play a crucial role in determining the affordability of housing. Often cities have antiquated or inappropriate design standards and regulations that increase the cost of land and housing provision. Common regulations are inappropriately large minimum plot dimensions that result in expensive plots of land to purchase as well as to service with infrastructure. As the experience from Pakistan shows, modifying building standards and regulations, for instance the minimum plot size or building height limit, can not only contribute to lowering the cost of new housing development but also allow for the in-situ upgrading of already informal areas through being able to formalise them within newly adopted more flexible regulations. 

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