housing developments in european countries - Department of ...

More documents

Recommendations

Info

Section 1 Introduction and Summary Introduction and Summary Section 1 Danish, Swedish and French governments have introduced incentives intended to encourage investment in this sector. The management of social rented housing and its increasingly residual nature in socioeconomic terms is also identified as a key issue in housing policy statements in many of the long-standing EU members. As a result, the governments of the Flanders and Wallonia regions of Belgium, Luxembourg, Ireland and Denmark, are endeavouring to promote a more diverse spatial mix of different housing tenures, in an effort to reduce the social exclusion of disadvantaged groups. In addition, a range of reforms to arrangements for social housing provision and management has been introduced. In Denmark, for instance, in recent years housing policy has placed increased emphasis on the involvement of the private sector in providing and managing social housing by means of public-private partnership arrangements. The regional governments in Belgium are working to enhance co-operation between the various associations which provide social housing, and if necessary encourage their geographical relocation in order to ensure that social housing needs in all parts of the country are adequately addressed. In Finland the income limits for access to social housing have recently been increased. Socio-economic deprivation and the associated physical dereliction of housing in inner-city areas is also a focus of intervention by governments in several of the longstanding EU member States. Thus, in many of these countries a range of urban renewal measures has been introduced in recent years, typically involving tax incentives to encourage the provision of new and refurbished housing in these locations. The Netherlands is notable for the particularly large number of urban renewal initiatives in operation. Many of these were originally proposed in the Government policy statement What People Want, Where People Live, published in December 2002. In contrast, housing policy makers in Bulgaria, Estonia, the Czech Republic, Hungary, Latvia, Lithuania, Poland, Slovakia, Slovenia and Romania are primarily concerned with responding to the effects of the sale of formerly State-owned housing. One of these effects is a shortage of social rented units in many CEE countries, which policy makers are attempting to address by increasing the output of dwellings in this tenure. The private rented sector in many of these countries is also very small and, in the view of many policy makers, its further development has been impeded by rent control measures. Thus, the Slovakian Government has recently liberalised the regulation of this sector and the Polish and Estonian governments are also currently considering potential reforms in this regard. The comparative under-development of the private mortgage lending market is of concern to policy makers in several of the new EU member States, on the grounds that this deficiency has hindered the provision of new private housing because neither potential property developers nor home buyers can access the requisite finance. In response, the Polish, Slovenian and Slovakian governments have all funded low interest loan schemes to enable households and social housing providers to build or renovate dwellings. In Estonia government intervention in the mortgage market has taken a distinctive form – the State Bank guarantees a proportion of mortgages raised by specified types of households from commercial lenders. As was mentioned above, policy makers in a number of countries face specific issues which are not of concern in other European countries but are very significant in the national context. For instance, in Turkey managing the aftermath of the major earthquake which occurred in 1999 in the Marmara region of the country is a key concern for government, as is dealing with unauthorised ‘squatter’ dwellings and discouraging further developments of this type in the future. As part of their negotiations regarding accession to the EU, the Maltese and Czech governments have introduced measures to restrict the purchase of second homes. In Cyprus the Government has introduced a number of measures to house families which are refugees as a result of the partition of the island in 1974. 1.4.3 Outcomes Demand for housing at the national level significantly exceeds supply in more than half of the countries examined in this review. However, the severity of the demand/supply imbalance varies extensively between countries. Broadly speaking, problems in this regard are less severe in the 15 longstanding EU member States. Rising numbers of households, usually associated with falling average household size, are a key driver of housing demand in all the European countries where the market is not in equilibrium. In several of the new EU members, the size and quality of the existing housing stock is also a significant driver of housing demand. In these countries, the expected future development of the mortgage market will also inflate housing demand by facilitating house purchase on a large scale. The governments of the vast majority of the 28 countries reported localised housing shortages, which affect specific regions of the country or parts of the housing market. Housing is supplied through three mechanisms: new construction, the conversion of non-residential buildings to housing use and the rehabilitation of obsolete dwellings. In all 28 countries, the first of these three mechanisms makes the biggest contribution to new housing supply. However, the level of housing construction varies internationally. Figure 1.4.1 Trends in new house building in 2000 are sketched in FIGURE 1.4.1. In this graph, Portugal, Spain and Note: the Republic of Ireland are categorised as ‘high output’ countries, on the grounds that they had by far the largest housing output per capita in Europe. Conversely, levels of new house building in a number of countries are categorised as low in the wider European context. The countries in this category are Bulgaria, the Czech Republic, Hungary, Latvia, Annual Dwelling Unit Completions per 1,000 Population in European Countries, 2000 Latvia Bulgaria Lithuania Romania Sweden Hungary Poland Slovakia Czech Republic Denmark United Kingdom Slovenia Germany Greece Belgium Netherlands Luxembourg Finland France Austria Cyprus Portugal Ireland Spain 0.4 1.1 1.2 1.3 1.7 2.5 2.3 2.39 2.5 2.9 3.1 3.1 3.5 3.7 3.9 4.5 Very low output Low output Moderate output High output Figures represent the number of dwelling units constructed on an annual basis per 1,000 population. 5.3 See TABLE 4.2.1 in Section 4 of the main report for full details of the data on which this graph is based. All data are for 2000, with the exception of: Spain (2002 data), Luxembourg (2001 data), Germany (2002 data) and Greece (average annual output since 1998). Data for Estonia, Italy and Turkey are not available. 6.3 6.37 6.6 7.6 11.5 13.15 13.8 Lithuania, Poland, Romania, Slovakia and Sweden. It is interesting to note that, with the exception of Sweden, all of the countries in this category are in Central and Eastern Europe. In most of these countries housing output rates dropped sharply after their 12 European Union Report Regular National Report on Housing Developments in European Countries 13
Section 1 Introduction and Summary Introduction and Summary Section 1 Table 1.4.5 Country Austria Bulgaria Cyprus Czech Republic Denmark Estonia Finland France Germany Hungary Ireland Italy Latvia Lithuania Luxembourg Malta Netherlands Poland Portugal Romania Slovakia Slovenia Spain Sweden Disequilibrating Factors in Housing Markets in European Countries up to 2004 Disequilibrating Factors Reduced central government subsidies towards local government supports for house building and refurbishment may reduce supply and increase prices. Low household incomes mean that demand for housing is not supported by purchasing power and consequently supply is low. The continually rising construction cost is due to the general rising cost of land materials and petrol, and lack of availability of labour. The lack of private sector involvement in rental housing construction is compounded by the impact of rent control measures and shortcomings in government supports for housing construction. Rent control inhibits mobility in the housing market and discourages the construction of private rented dwellings. The impact of the planning process, particularly in rural areas, means that the building process is quite a time-consuming activity. Low interest rate environment drives demand for owner-occupied housing. There is insufficient construction in high demand areas. Increasing land prices impede social house building. There is over-supply of social housing and affordable private housing in some areas and under-supply in others. Demand for second homes has led to problems for local residents. There are increases in development land prices, particularly in the west of the country. Limited mobility is evident among existing home owners. Low average incomes mean that demand is not supported by purchasing power. Factors include: high inflation and shortage of skills in the construction industry, shortage of serviced building land in high demand areas and capacity problems in the spatial planning system. Supply of rental accommodation is insufficient to meet demand. There are housing access problems among disadvantaged groups and problems with the provision and management of social housing. Low household incomes mean that demand for housing is not supported by purchasing power; other factors include insufficiently developed financial system and legislative arrangements; construction of non-residential developments rather than dwellings. There has been a sharp reduction in construction activity, due to a fall in direct funding by the State for this sector and the failure of the private sector to compensate for the withdrawal of funding. Low average incomes mean demand is not supported by purchasing power. The costs of new infrastructure are high. There is a limited supply of development land and there are unresolved issues in relation to land restitution. Local authorities are slow in preparing land-use planning documents. Demand is compounded by population growth and a rising number of households. Supply has been restricted by the high price of development land and high construction costs. An increasing number of households are encountering difficulties in securing finance for a new building. Factors include: shortage of land for development and a limited use of high-rise construction; high levels of vacant and dilapidated properties unavailable to those in need of housing. Although rent control legislation has been liberalised, remaining provisions in this regard are still distorting the market. Economic stagnation has made consumers unwilling to invest in housing. Therefore selling and buying dwellings in the more expensive segment of the market has become more difficult. This has led to a lack of mobility in the housing market which has impeded access by new households. There are problems in accessing mortgage credit. Factors include: scarcity of building land and high land prices in areas of high housing demand; excessive bureaucracy associated with construction. Factors include the high cost of building materials caused by a monopoly in the construction sector, and high tariffs on imported materials; inadequate supply of development land in urban areas. Low household incomes restrict demand. Other factors include: limited availability of serviced building land in high demand areas, indeterminate ownership status of land; insufficient supply of affordable housing suitable for first-time buyers and older people. Factors include: difficulties in financing construction and inadequate supply of serviced building land, particularly in urban areas. There is a limited supply of development land in cities where demand is greatest. Factors include: a low housing output in high demand areas caused by a shortage of serviced land and high building costs; impediments related to the planning system including the level of appeals and the reluctance of some local authorities to increase the local population for fear of rising costs for municipal services. Turkey There are difficulties arising from procurement legislation such as the need for a very lengthy bidding process. Lack of availability of mortgage loans and finance, and of land, has impeded private and public sector construction. United Kingdom There is a shortage of skilled workers in the construction industry, particularly in the home building sector. Note: A more detailed version of this table is included in Section 4 of the main report. Information for Belgium and Greece is not available. political and economic reorganisation in the early 1990s and have not since returned to the levels of earlier decades. Section 4 of this report reveals that in recent years new housing output across Europe has been dominated by the private sector and that there has been an associated decline in social housing construction in both relative and absolute terms. In most countries the majority of new housing construction takes place in urban areas, although in the countries surrounding the Mediterranean, output of second homes adjacent to holiday resorts is also high. However, in most European countries, the level of new house construction in the largest and most economically successful urban areas falls short of demand. In the survey on which this report is based, a wide range of causes of housing market disequilibrium were identified by housing ministries. These include: Figure 1.4.2 Note: ■ the relative inelasticity of housing supply changes in response to demand fluctuations; ■ overall economic and demographic conditions which dictate the strength of housing demand; ■ specific government policies that have either curtailed or augmented the demand for, and supply of housing; ■ scarcity of development land, particularly in urban areas; ■ the operation of land-use planning, procurement and building control systems; ■ rent controls which are a significant impediment to investment in the private rented sector, and % Share of Household Income or Expenditure Devoted to Housing Costs in European Countries, Various Years Malta United Kingdom Slovenia Estonia Czech Republic Lithuania Slovakia Portugal Netherlands Germany Sweden Denmark France Italy Poland Austria Belgium 8.4 9.69 10.8 The methods used to assess housing expenditure varies significantly across Europe. See TABLE 4.8.1 in the main body of this report for full details of the data on which this graph is based. 16 17.2 18 19.6 19.8 ■ increasing construction costs and a lack of suitably skilled labour. The specific disequilibrating factors which are of most significance in the individual countries under examination are summarised in TABLE 1.4.5. The interaction between housing supply and demand also has implications for housing affordability. The available information on the proportion of income or expenditure which households in European countries devote to housing expenditure is summarised in FIGURE 1.4.2. However, variations in the methods used to assess housing expenditure mean that direct comparisons between countries can be made on the basis of this information. Nevertheless some broad trends can be identified. One clear trend evident from 21 21.7 22 22 22.5 24.7 24.8 24.5 26.6 14 European Union Report Regular National Report on Housing Developments in European Countries 15
Page 1 and 2: REGULAR NATIONAL REPORT ON SYNTHESI
Page 3 and 4: Regular National Report on Housing
Page 5 and 6: Table of Contents Table of Contents
Page 7 and 8: Definition of Terms New Member Stat
Page 9 and 10: Section 1 Introduction and Summary
Page 13: Section 1 Introduction and Summary
Page 19 and 20: Section 2 Context Context Section 2
Page 55 and 56: Section 3 Policies Policies Section
Page 65 and 66:
Section 3 Policies Policies Section
Page 67 and 68:
Page 69 and 70:
Page 71 and 72:
Page 73 and 74:
Page 75 and 76:
Section 3 Policies 3.7.2 Expected M
Page 77 and 78:
Section 4 Outcomes Outcomes Section
Page 79 and 80:
Page 81 and 82:
Page 83 and 84:
Page 85 and 86:
Page 87 and 88:
Page 89 and 90:
Page 91 and 92:
Page 93 and 94:
Page 95 and 96:
Page 97 and 98:
Appendix 1 Members of European Hous
Page 99 and 100:
Appendix 2 Questionnaire 4.4 Housin
show all

housing developments in european countries - Department of ...

You also want an ePaper? Increase the reach of your titles

Delete template?

Save as template?