10 ms·

Vienna has a 100-year history of building public housing for all (2018)

92 points by dataminer 6y ago

aerosmile 6y ago
Here's the gist: the government taxed the shit out of the landlords and forced them to sell their land cheaply. Europeans generally see nothing wrong with this strategy, whereas most Americans will feel shivers down their spines. This difference comes from different attitudes around ownership. In places like China and Russia, owning a house means you get to keep the house unless enough people would benefit from you not owning it. In the US, you get to keep your house no matter how much anyone - including the government - would prefer you didn't. Europe is somewhere in between on that spectrum, and this attitude extends to not just land ownership. For example, a popular ad campaign in Austria is demanding from the employees of BioNTech to leak the base components and production instructions so that other companies can steal those trade secrets and supposedly help generate more vaccines. If you read the comments in one of the videos on this topic, you will see them being mostly in favor of the campaign: https://www.youtube.com/watch?v=zDnZd7UmBco https://www.youtube.com/watch?v=zDnZd7UmBco. It would be difficult to imagine many of my US friends advocating for stealing company secrets. I am not implying that either group has better ethics - they just have different attitudes towards the concept of ownership.
- jarjoura 6y ago
  | In the US, you get to keep your house no matter how much anyone - including the government - would prefer you didn't. That's not accurate. The US, state and city governments can most definitely take private land and convert it to public use if enough people benefit from it. https://www.justice.gov/enrd/history-federal-use-eminent-domain https://www.justice.gov/enrd/history-federal-use-eminent-dom... There are other means as well, a city could purchase something on the open market, or a county could purchase land and convert into a public park, or what ever suits them.
- throwawayboise 6y ago
  > In the US, you get to keep your house no matter how much anyone - including the government - would prefer you didn't. Not true at all. Eminent Domain is a real thing. The controversies have generally been when there is a dispute over whether the taking is for a public benefit, e.g. condeming property to make way for a private business.
  - ghaff 6y ago
    It is but it's increasingly difficult. Constructing the Interstate Highway System would have be far more challenging today. (Some of our property growing up was taken for this purpose. Don't really know if my parents considered it an OK deal at the time.)
  - aerosmile 6y ago
    > Eminent Domain is a real thing. It's technically a thing but totally not a thing in the context of my comment and this topic in general. I doubt you'll make a case that China, Russia, or for that matter, even Austria have stronger private property rights than the US. Remember, the origination story of the US revolves around private land ownership attracting European migrants who were fed up with European feudalism. I am sure there are some carveouts here and there, but they are remarkably minimal to the point that it's sometimes worth making an observation without adding a bunch of footnotes.
    - pchristensen 6y ago
      Other countries, notably Japan but others that escape my memory, have stronger property rights because the government has weaker power of eminent domain. This has more details, see the section about Japan - https://pedestrianobservations.com/2018/02/02/civil-service-racism-and-cost-control/ https://pedestrianobservations.com/2018/02/02/civil-service-...
- ajsnigrutin 6y ago
  I'm your neighbor to the south (slovenia)... here, your house is practically untouchable if you mess up, but most people want other people to be taxed for owning a house. They also want owners of vacant properties taxed a lot more (which they believe would create more rentable apartments, but vacant apartmnts in big cities are rented out without contracts and without tax - usually to students, who prefer a risky cheap apartment, to a contract+more expensive, and vacant houses outside of cities are empty because literally noone wants to live there - you can buy a house with a large yard around it for a price of a used WV Golf in some parts of slovenia, and maybe half a bathroom in our capital). The same people also want people making money by renting out apartments pay more taxes on rent, because they somehow believe that the increase of taxes wont mean increase in rent prices.... i have no idea why. But our largest problem is the same as in many other cities, including San Francisco.... want to build something? You have to buy a run down house, because you're not allower to build stuff on farming area, literally by the city center... and when you build a house, it can be 2 family house max. We need huge apartment buildings, but finding an area where an invester can build ones is impossible, because our municipality and goverment don't allow it.
  - selimthegrim 6y ago
    Do people still have apartment rights left over from ex-YU?
    - ajsnigrutin 6y ago
      There was a law passed in the 90s, where people who were assigned (government) apartments, could buy them from the government for really really cheap, and get government loans to do so (+ we had a lot of inflation, so we're talking 20year loans, where people would pay around an equivalent of ~50eur monthly... basically nothing). So yeah... those who bought the apartments are happy, those who paid for the construction (the rest), and didn't get any, were not, and government currently has just a few "social apartments" for poor people. On the other hand, if the government was a landlord to all those people, that would mean a lot more administration and a lot more work (basically, back to yu-levels, or even worse, because people expected more after the fall of yugoslavia).
ghgdynb1 6y ago
I legitimately wanted to evaluate the argument here but there’s so much backstory and political contextualization I gave up reading this without ever having found out what the Viennese did.
- chrischen 6y ago
  > If we don’t want Vancouver to go down this path, then perhaps we should heed Henry George’s advice: tax land and use the proceeds to build the housing we need.
  - giantg2 6y ago
    Isn't that the solution to all - tax those who have (or are not part of our tribe) to pay for "us".
    - arcticbull 6y ago
      It's a great way to reduce inequality, sure. It's one way to reduce housing prices, but generally just increasing supply is simpler and more palatable.
      - giantg2 6y ago
        I guess it addresses it on the effect side more than the cause side (inequality). This is the way they are increasing supply.
        arcticbull 6y ago
        This is an unpopular opinion to be sure, but I believe in wealth inequality and income inequality, so long as the standard of living at the bottom is reasonable - and there exists meaningful social mobility. I'd rather tax it on the backend than impede the front end. This is just a matter of opinion of course.
        6y ago
larsiusprime 6y ago
From the article: > As both the Vienna model and Henry George[1] would suggest, the problem is forever and always the cost of land. Burdensome land costs, and the rentiers who gain massive wealth by passive land speculation, are the real enemies — not developers, not our homeowners, not our public officials. [1] https://thetyee.ca/Solutions/2018/06/04/Tax-To-Solve-Housing-Crisis/ https://thetyee.ca/Solutions/2018/06/04/Tax-To-Solve-Housing... (linked in the article) EDIT: From the looks of it Vienna's policy isn't purely Georgist, but it has a few policies (namely land tax, particularly on vacant lots) out of Henry's playbook.
- giantg2 6y ago
  Sometimes the taxes on the land are even more burdensome than the land itself when you look at it over even a 30 year mortgage.
  - larsiusprime 6y ago
    Are you referring to taxes on ground rent (what is typically meant by "land tax" -- a tax on the value of the land if it was an empty lot), or taxes on improvements (what's built on the land)? Conventional property tax is a mixture of pure land tax and a tax on improvements. And are you talking in general, or do you have some specific insight into Vienna's particular policies?
    - giantg2 6y ago
      In general and total real estate property tax. I will pay at least as much property tax over the next 50 years as what I paid for my house.
      - larsiusprime 6y ago
        Thanks! I'm curious -- if it's not weird to ask, does your property tax bill happen to separate out how much is due to improvements and how much to ground rent?
franze 6y ago
There is something called in Austria called "Freunderlwirtschaft". Its Austrian for "corruption but everybody is doing it so it is ok". These "Gemeindebauten" (affordable cheap public housing) have good flats and good areas and bad flats and bad areas. So if you want to be in the really good ones, you better have the right "Parteibuch" (party affiliation) or a friend who has it. Said that, Gemeindebauten are a great but flawed system.
- franze 6y ago
  I think a much better effect has the "Altbaumiete" (old pre world-war-II housing) which are rent controlled. Kinda great living, slightly windy and sometimes smelly and there may be lead in the pipes, but at least affordable.
forrestthewoods 6y ago
So a hundred years ago the city imposed crazy taxes on land owners and then bought the land for themselves. Then the city built a lot of housing on the now city-owned land via non-profit construction. The article doesn’t make a strong attempt to explain how their housing affordability is “solved” though. How easy it to find a new apartment to rent? How much does it cost? What do you get for that price? How does this compare to other cities in Europe? How does Vienna compare to other Austrian cities which did not buy up land? It’s an interesting case study and I’d love to know more. But this article leaves a LOT of open questions.
- phaer 6y ago
  It's generally comparatively easy to find a flat here. Rents are low compared to most other cities of its size in central Europe, but rose by quite a lot in the last two decades. I pay about 650€ per month for a 1-bedroom-apartment in central Vienna, with good infrastructure Hard to compare it to other Austrian cities, because those are generally much smaller (but can be more expensive than Vienna(.
- jeffbee 6y ago
  Objectively, Vienna's housing price index is up 75% in real terms since 1990. While that's not the ideal 0%, it is much better than San Francisco where prices have gone up by 400% since 1990.
  - forrestthewoods 6y ago
    SF is an economics lesson on what not to do. Complete and catastrophic failure across the board. Low prices don’t mean much if there is no market availability. Many cities that are heavily rent controlled have horror stories of year long waits to get a unit. Or, far worse, black markets where controlled units exchange hands privately. The other responder to my comment suggests this is not the case in Vienna, nice! The laws of supply and demand can not be defeated. Vienna is a desirable city, so there should be demand. If the city has found a way to produce sufficient supply that’s interesting. Most major cities, including SF, have completely failed to produce sufficient supply.
jschveibinz 6y ago
A city government manipulating the price of urban property so that it can purchase it? This doesn’t seem like a workable model. Doesn’t that reduce property tax revenue? Doesn’t that affect the value of other land in general? Why wouldn’t urban land holders sue the city for damages?
- tom_mellior 6y ago
  Unlike some other places (the US?), in Austria property tax is a relatively minor part of cities's finances. It's also computed based not on "actual" property values but on fictional values that haven't been adjusted since 1973 or so. For both of these reasons, the city doesn't stand to lose from sinking land prices (not that they are sinking). Also, I can't find the numbers right now, but a lot of land in Vienna is owned by the Catholic Church. Religious organizations are conveniently exempt from property tax. > Why wouldn’t urban land holders sue the city for damages? As far as I can tell, Austrian courts don't subscribe to a notion that investments in real estate should be guaranteed to be risk-free.
kcorbitt 6y ago
The article states that Vienna's population in 1914 (at the beginning of WW1) was 2 million, vs 1.9 million today. I'm no housing policy expert, but isn't it possible that Vienna's rents are stable and low in part because they haven't had to increase their housing stock in over 100 years? It seems to me that a new-world city like Vancouver that has grown tremendously over that period wouldn't be directly comparable.
- tom_mellior 6y ago
  > Vienna's population in 1914 (at the beginning of WW1) was 2 million, vs 1.9 million today. You can't just take those two data points and assume that they are connected by a straight line. Vienna was down to about 1.5 million around 1990 and has been growing since. https://en.m.wikipedia.org/wiki/Vienna#Demographics https://en.m.wikipedia.org/wiki/Vienna#Demographics > Vienna's rents are stable and low For the record, they are neither. There has been crazy, and accelerating, growth in rental costs over the last ten years.
  - I_am_tiberius 6y ago
    I assume that concerns many cities worldwide but it seems that currently everyone is trying to get rid of cash and take cheap loans to buy real estate. I check the real estate websites in Austria on a daily basis and can say that real estate supply has definitely decreased during the past year.
- renewiltord 6y ago
  Interestingly, SF's population has only grown 13% from 1950 to 2020. The housing prices have grown rather differently, though. Curious to see, isn't it?
  - krisroadruck 6y ago
    I imagine it has only grown 13% precisely because housing prices have grown drastically. If enough housing supply was added to keep rents reasonable, I imagine there would be a lot more people there. Instead raising rents allows the city to cycle out the less wealthy and exchange them for the more wealthy.
gyulai 6y ago
Knowing Vienna quite well and knowing Vancouver at least a little bit, I'd say this is not apples-to-apples. In Vancouver it was the real estate boom that has fueled high-quality residential development: Given the circumstance where such development would fetch high prices, residential development was conducted that would deliver on a level of quality commensurate with high prices (namely: high quality!). A "Gemeindebau" in Vienna is a very different animal: They are built cheaply for the purpose of being cheap, and the quality you get ouf of that is in line with the principle "you get what you pay for" (namely: low quality!)
- masswerk 6y ago
  This isn't necessarily true, especially for the original building program. Pre-war apartment buildings for the masses (Zinshaus) were raised quickly and weren't maintained well. E.g., before regulations outlawed the cheaper variety in the 1990s, cheap apartments often lacked a bathroom of their own and relied on shared facilities. The public building program, on the other hand, was up to modern standards (and taking pride in doing so), while it was still aimed at efficiency and never intended to rival the residential buildings raised by private ownership for the middle class. So, if you expect high rooms, stucco, etc, you're probably in the wrong market. (Also, you may not be part of the intended audience, anyway.)
rhacker 6y ago
Make renting illegal and it all works.
- wallacoloo 6y ago
  source?
dantheman 6y ago
Vienna is the most dull and calcified city I've ever lived in, and it's not a growing city. It's not super useful to compare to cities that are thriving.
- fantod 6y ago
  I guess it's a matter of taste. Having lived in both Vancouver and Vienna, I would say the latter is without a doubt a better place to live.
- dang 6y ago
  It's 1920s Vienna that is looked to for lessons about public housing.
- r0f1 6y ago
  Vienna is the most livable city 10 times in a row now!
  - gyulai 6y ago
    These economist rankings are done from the point of view of rich expats. I very much doubt that their lives have much in common with the lives of people living in Vienna's public housing.
    - dantheman 6y ago
      Yeah, it's a provincial backwater; even as an expat - it's pleasant for awhile, but notice how people never want to go these top 10 cities... LA, NY, SF, London, Paris, Tokyo etc are not in these lists.
      - ghaff 6y ago
        There are different definitions of livability. Evaluating NYC in the same vein as, say, Nashville seems pretty much impossible.
  - deleted 6y ago
    [deleted]
giantg2 6y ago
If we are going to get government involved in this, then why not shift to cheaper area? There's cheaper land in more rural areas that the government could develop and entice businesses to move to. This would be cheaper for the tax payer. There's also an exodus from many cities which leave abandoned buildings that could be converted to living space. Maybe the article works for Vancouver (I've never been there), but I don't see it working in most places. Why downvote with no reply?
- em-bee 6y ago
  aren't cheaper areas cheaper because less people want to live there?
  - giantg2 6y ago
    It's usually cheaper because there are fewer people living there. That is usually due to fewer jobs being available. Many people are forced to move away from the small town or rural communities that they grew up in due to a lack of industry. So many people would like to live there, but can't due to the work constraints. Imagine the savings that a major company could have if they moved from a place like silicon valley to somewhere like Kentucky. Land can be had for $500 an acre, cost of living is lower and could greatly reduce salary requirements, and you can still have this while being less than an hour from a major city (or two).
    - em-bee 6y ago
      ah, yes, for a company that people want to work for that makes sense. i misread your post and thought you meant for the government to motivate the building of housing in cheaper areas. unfortunately it's often either one or the other, but not both. most places i have seen are satellite cities where people live but commute into the actual city center, or they are industrial parks without any living quarters nearby. it takes a lot more to make such areas attractive.
bane 6y ago
A sorta aside. The absolute best AirBnB experience we ever had was in Vienna. Of course it's an anecdote, but we had absolutely no trouble finding convenient, cheap, and large places to stay under $70/night. This made us think that the housing market there must be quite cheap compared to where we're from. We ended up staying in an absolutely beautiful flat about 20 minutes from the city center via U-Bahn for <$60/night -- a price we've paid for old bedrooms in lesser cities. The same flat where we live would easily cost closer to $3k/mo.
- tom_mellior 6y ago
  Thanks in part to AirBnB, that apartment is approaching 3k/mo in Vienna as well.
arcticbull 6y ago
Singapore does something similar, with 80% of the population living in HDB accommodations [1]. The other 20% is a free-for-all near as I can figure. [1] https://en.wikipedia.org/wiki/Public_housing_in_Singapore https://en.wikipedia.org/wiki/Public_housing_in_Singapore
- Barrin92 6y ago
  I think Singapore also has some particular relevance to the US because of its multi-ethnic nature. Often when I talk to Americans about public housing a really common argument is the image of public housing as a sort of racist thing that creates enclaves for certain (usually low-income) groups. Yet Singapore, with its integration policies has virtually completely avoided this, and it basically can only do it effectively because it controls the housing stock. It's not a utopia but the degree to which people intermingle and live together is quite astonishing if you're used to French Banlieues or the segregation in many American cities today.
  - rsj_hn 6y ago
    Singapore is "multi-ethnic" in the sense that it broke off from nearby Malaysia in order to have a Chinese majority city state, and adopted explicit policies to try to manage the Malay and Indian population in order to ensure that it is an ethnically Chinese run government. You can listen to some of Lee Kuan Yew's speeches to see how multi-ethnic it is, and what he thought of the US approach to diversity -- e.g. "multiculturalism will destroy America." (https://www.forbes.com/sites/realspin/2013/02/13/singapores-lee-kuan-yew-talks-americas-strangths-and-weaknesses/?sh=6e36af3033d3 https://www.forbes.com/sites/realspin/2013/02/13/singapores-...) The "integration" policies you refer to are there to limit non-chinese representation -- in the US we would call it a gerrymandering-support policy. Singapore also has an immigration policy meant to attract successful entrepreneurs, with no citizenship path for cheap labor, only temporary work visas. It does not accept any refugees or political asylum seekers. Being born in Singapore doesn't make you a citizen (no soil-based, only blood-based criteria).
    - Barrin92 6y ago
deleted 6y ago
[deleted]
peter_d_sherman 6y ago
>"Vienna provides an interesting counterpoint. Because rent control disincentivized the private development of rental buildings, landlords were, for a time, removed from the market for urban land. Consequently prices finally went down, allowing the city to buy land at a much reduced price; often it was the only buyer in the market." PDS: An interesting cycle (or set of cycles) of cause and effect... Disclaimer: I am neither for nor against rent control...

92 points by dataminer 6y ago

Here's the gist: the government taxed the shit out of the landlords and forced them to sell their land cheaply. Europeans generally see nothing wrong with this strategy, whereas most Americans will feel shivers down their spines. This difference comes from different attitudes around ownership. In places like China and Russia, owning a house means you get to keep the house unless enough people would benefit from you not owning it. In the US, you get to keep your house no matter how much anyone - including the government - would prefer you didn't. Europe is somewhere in between on that spectrum, and this attitude extends to not just land ownership. For example, a popular ad campaign in Austria is demanding from the employees of BioNTech to leak the base components and production instructions so that other companies can steal those trade secrets and supposedly help generate more vaccines. If you read the comments in one of the videos on this topic, you will see them being mostly in favor of the campaign: https://www.youtube.com/watch?v=zDnZd7UmBco https://www.youtube.com/watch?v=zDnZd7UmBco. It would be difficult to imagine many of my US friends advocating for stealing company secrets. I am not implying that either group has better ethics - they just have different attitudes towards the concept of ownership.

jarjoura 6y ago
| In the US, you get to keep your house no matter how much anyone - including the government - would prefer you didn't. That's not accurate. The US, state and city governments can most definitely take private land and convert it to public use if enough people benefit from it. https://www.justice.gov/enrd/history-federal-use-eminent-domain https://www.justice.gov/enrd/history-federal-use-eminent-dom... There are other means as well, a city could purchase something on the open market, or a county could purchase land and convert into a public park, or what ever suits them.
throwawayboise 6y ago
> In the US, you get to keep your house no matter how much anyone - including the government - would prefer you didn't. Not true at all. Eminent Domain is a real thing. The controversies have generally been when there is a dispute over whether the taking is for a public benefit, e.g. condeming property to make way for a private business.
- ghaff 6y ago
  It is but it's increasingly difficult. Constructing the Interstate Highway System would have be far more challenging today. (Some of our property growing up was taken for this purpose. Don't really know if my parents considered it an OK deal at the time.)
- aerosmile 6y ago
  > Eminent Domain is a real thing. It's technically a thing but totally not a thing in the context of my comment and this topic in general. I doubt you'll make a case that China, Russia, or for that matter, even Austria have stronger private property rights than the US. Remember, the origination story of the US revolves around private land ownership attracting European migrants who were fed up with European feudalism. I am sure there are some carveouts here and there, but they are remarkably minimal to the point that it's sometimes worth making an observation without adding a bunch of footnotes.
  - pchristensen 6y ago
    Other countries, notably Japan but others that escape my memory, have stronger property rights because the government has weaker power of eminent domain. This has more details, see the section about Japan - https://pedestrianobservations.com/2018/02/02/civil-service-racism-and-cost-control/ https://pedestrianobservations.com/2018/02/02/civil-service-...
ajsnigrutin 6y ago
I'm your neighbor to the south (slovenia)... here, your house is practically untouchable if you mess up, but most people want other people to be taxed for owning a house. They also want owners of vacant properties taxed a lot more (which they believe would create more rentable apartments, but vacant apartmnts in big cities are rented out without contracts and without tax - usually to students, who prefer a risky cheap apartment, to a contract+more expensive, and vacant houses outside of cities are empty because literally noone wants to live there - you can buy a house with a large yard around it for a price of a used WV Golf in some parts of slovenia, and maybe half a bathroom in our capital). The same people also want people making money by renting out apartments pay more taxes on rent, because they somehow believe that the increase of taxes wont mean increase in rent prices.... i have no idea why. But our largest problem is the same as in many other cities, including San Francisco.... want to build something? You have to buy a run down house, because you're not allower to build stuff on farming area, literally by the city center... and when you build a house, it can be 2 family house max. We need huge apartment buildings, but finding an area where an invester can build ones is impossible, because our municipality and goverment don't allow it.
- selimthegrim 6y ago
  Do people still have apartment rights left over from ex-YU?
  - ajsnigrutin 6y ago
    There was a law passed in the 90s, where people who were assigned (government) apartments, could buy them from the government for really really cheap, and get government loans to do so (+ we had a lot of inflation, so we're talking 20year loans, where people would pay around an equivalent of ~50eur monthly... basically nothing). So yeah... those who bought the apartments are happy, those who paid for the construction (the rest), and didn't get any, were not, and government currently has just a few "social apartments" for poor people. On the other hand, if the government was a landlord to all those people, that would mean a lot more administration and a lot more work (basically, back to yu-levels, or even worse, because people expected more after the fall of yugoslavia).

ghgdynb1 6y ago

I legitimately wanted to evaluate the argument here but there’s so much backstory and political contextualization I gave up reading this without ever having found out what the Viennese did.

chrischen 6y ago
> If we don’t want Vancouver to go down this path, then perhaps we should heed Henry George’s advice: tax land and use the proceeds to build the housing we need.
- giantg2 6y ago
  Isn't that the solution to all - tax those who have (or are not part of our tribe) to pay for "us".
  - arcticbull 6y ago
    It's a great way to reduce inequality, sure. It's one way to reduce housing prices, but generally just increasing supply is simpler and more palatable.
    - giantg2 6y ago
      I guess it addresses it on the effect side more than the cause side (inequality). This is the way they are increasing supply.
      - arcticbull 6y ago
        This is an unpopular opinion to be sure, but I believe in wealth inequality and income inequality, so long as the standard of living at the bottom is reasonable - and there exists meaningful social mobility. I'd rather tax it on the backend than impede the front end. This is just a matter of opinion of course.
        6y ago

larsiusprime 6y ago

From the article: > As both the Vienna model and Henry George[1] would suggest, the problem is forever and always the cost of land. Burdensome land costs, and the rentiers who gain massive wealth by passive land speculation, are the real enemies — not developers, not our homeowners, not our public officials. [1] https://thetyee.ca/Solutions/2018/06/04/Tax-To-Solve-Housing-Crisis/ https://thetyee.ca/Solutions/2018/06/04/Tax-To-Solve-Housing... (linked in the article) EDIT: From the looks of it Vienna's policy isn't purely Georgist, but it has a few policies (namely land tax, particularly on vacant lots) out of Henry's playbook.

giantg2 6y ago
Sometimes the taxes on the land are even more burdensome than the land itself when you look at it over even a 30 year mortgage.
- larsiusprime 6y ago
  Are you referring to taxes on ground rent (what is typically meant by "land tax" -- a tax on the value of the land if it was an empty lot), or taxes on improvements (what's built on the land)? Conventional property tax is a mixture of pure land tax and a tax on improvements. And are you talking in general, or do you have some specific insight into Vienna's particular policies?
  - giantg2 6y ago
    In general and total real estate property tax. I will pay at least as much property tax over the next 50 years as what I paid for my house.
    - larsiusprime 6y ago
      Thanks! I'm curious -- if it's not weird to ask, does your property tax bill happen to separate out how much is due to improvements and how much to ground rent?

franze 6y ago

There is something called in Austria called "Freunderlwirtschaft". Its Austrian for "corruption but everybody is doing it so it is ok". These "Gemeindebauten" (affordable cheap public housing) have good flats and good areas and bad flats and bad areas. So if you want to be in the really good ones, you better have the right "Parteibuch" (party affiliation) or a friend who has it. Said that, Gemeindebauten are a great but flawed system.

franze 6y ago
I think a much better effect has the "Altbaumiete" (old pre world-war-II housing) which are rent controlled. Kinda great living, slightly windy and sometimes smelly and there may be lead in the pipes, but at least affordable.

forrestthewoods 6y ago

So a hundred years ago the city imposed crazy taxes on land owners and then bought the land for themselves. Then the city built a lot of housing on the now city-owned land via non-profit construction. The article doesn’t make a strong attempt to explain how their housing affordability is “solved” though. How easy it to find a new apartment to rent? How much does it cost? What do you get for that price? How does this compare to other cities in Europe? How does Vienna compare to other Austrian cities which did not buy up land? It’s an interesting case study and I’d love to know more. But this article leaves a LOT of open questions.

phaer 6y ago
It's generally comparatively easy to find a flat here. Rents are low compared to most other cities of its size in central Europe, but rose by quite a lot in the last two decades. I pay about 650€ per month for a 1-bedroom-apartment in central Vienna, with good infrastructure Hard to compare it to other Austrian cities, because those are generally much smaller (but can be more expensive than Vienna(.
jeffbee 6y ago
Objectively, Vienna's housing price index is up 75% in real terms since 1990. While that's not the ideal 0%, it is much better than San Francisco where prices have gone up by 400% since 1990.
- forrestthewoods 6y ago
  SF is an economics lesson on what not to do. Complete and catastrophic failure across the board. Low prices don’t mean much if there is no market availability. Many cities that are heavily rent controlled have horror stories of year long waits to get a unit. Or, far worse, black markets where controlled units exchange hands privately. The other responder to my comment suggests this is not the case in Vienna, nice! The laws of supply and demand can not be defeated. Vienna is a desirable city, so there should be demand. If the city has found a way to produce sufficient supply that’s interesting. Most major cities, including SF, have completely failed to produce sufficient supply.

jschveibinz 6y ago

A city government manipulating the price of urban property so that it can purchase it? This doesn’t seem like a workable model. Doesn’t that reduce property tax revenue? Doesn’t that affect the value of other land in general? Why wouldn’t urban land holders sue the city for damages?

tom_mellior 6y ago
Unlike some other places (the US?), in Austria property tax is a relatively minor part of cities's finances. It's also computed based not on "actual" property values but on fictional values that haven't been adjusted since 1973 or so. For both of these reasons, the city doesn't stand to lose from sinking land prices (not that they are sinking). Also, I can't find the numbers right now, but a lot of land in Vienna is owned by the Catholic Church. Religious organizations are conveniently exempt from property tax. > Why wouldn’t urban land holders sue the city for damages? As far as I can tell, Austrian courts don't subscribe to a notion that investments in real estate should be guaranteed to be risk-free.

kcorbitt 6y ago

The article states that Vienna's population in 1914 (at the beginning of WW1) was 2 million, vs 1.9 million today. I'm no housing policy expert, but isn't it possible that Vienna's rents are stable and low in part because they haven't had to increase their housing stock in over 100 years? It seems to me that a new-world city like Vancouver that has grown tremendously over that period wouldn't be directly comparable.

tom_mellior 6y ago
> Vienna's population in 1914 (at the beginning of WW1) was 2 million, vs 1.9 million today. You can't just take those two data points and assume that they are connected by a straight line. Vienna was down to about 1.5 million around 1990 and has been growing since. https://en.m.wikipedia.org/wiki/Vienna#Demographics https://en.m.wikipedia.org/wiki/Vienna#Demographics > Vienna's rents are stable and low For the record, they are neither. There has been crazy, and accelerating, growth in rental costs over the last ten years.
- I_am_tiberius 6y ago
  I assume that concerns many cities worldwide but it seems that currently everyone is trying to get rid of cash and take cheap loans to buy real estate. I check the real estate websites in Austria on a daily basis and can say that real estate supply has definitely decreased during the past year.
renewiltord 6y ago
Interestingly, SF's population has only grown 13% from 1950 to 2020. The housing prices have grown rather differently, though. Curious to see, isn't it?
- krisroadruck 6y ago
  I imagine it has only grown 13% precisely because housing prices have grown drastically. If enough housing supply was added to keep rents reasonable, I imagine there would be a lot more people there. Instead raising rents allows the city to cycle out the less wealthy and exchange them for the more wealthy.

gyulai 6y ago

Knowing Vienna quite well and knowing Vancouver at least a little bit, I'd say this is not apples-to-apples. In Vancouver it was the real estate boom that has fueled high-quality residential development: Given the circumstance where such development would fetch high prices, residential development was conducted that would deliver on a level of quality commensurate with high prices (namely: high quality!). A "Gemeindebau" in Vienna is a very different animal: They are built cheaply for the purpose of being cheap, and the quality you get ouf of that is in line with the principle "you get what you pay for" (namely: low quality!)

masswerk 6y ago
This isn't necessarily true, especially for the original building program. Pre-war apartment buildings for the masses (Zinshaus) were raised quickly and weren't maintained well. E.g., before regulations outlawed the cheaper variety in the 1990s, cheap apartments often lacked a bathroom of their own and relied on shared facilities. The public building program, on the other hand, was up to modern standards (and taking pride in doing so), while it was still aimed at efficiency and never intended to rival the residential buildings raised by private ownership for the middle class. So, if you expect high rooms, stucco, etc, you're probably in the wrong market. (Also, you may not be part of the intended audience, anyway.)

rhacker 6y ago

Make renting illegal and it all works.

wallacoloo 6y ago
source?

dantheman 6y ago

Vienna is the most dull and calcified city I've ever lived in, and it's not a growing city. It's not super useful to compare to cities that are thriving.

fantod 6y ago
I guess it's a matter of taste. Having lived in both Vancouver and Vienna, I would say the latter is without a doubt a better place to live.
dang 6y ago
It's 1920s Vienna that is looked to for lessons about public housing.
r0f1 6y ago
Vienna is the most livable city 10 times in a row now!
- gyulai 6y ago
  These economist rankings are done from the point of view of rich expats. I very much doubt that their lives have much in common with the lives of people living in Vienna's public housing.
  - dantheman 6y ago
    Yeah, it's a provincial backwater; even as an expat - it's pleasant for awhile, but notice how people never want to go these top 10 cities... LA, NY, SF, London, Paris, Tokyo etc are not in these lists.
    - ghaff 6y ago
      There are different definitions of livability. Evaluating NYC in the same vein as, say, Nashville seems pretty much impossible.
- deleted 6y ago
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giantg2 6y ago

If we are going to get government involved in this, then why not shift to cheaper area? There's cheaper land in more rural areas that the government could develop and entice businesses to move to. This would be cheaper for the tax payer. There's also an exodus from many cities which leave abandoned buildings that could be converted to living space. Maybe the article works for Vancouver (I've never been there), but I don't see it working in most places. Why downvote with no reply?

em-bee 6y ago
aren't cheaper areas cheaper because less people want to live there?
- giantg2 6y ago
  It's usually cheaper because there are fewer people living there. That is usually due to fewer jobs being available. Many people are forced to move away from the small town or rural communities that they grew up in due to a lack of industry. So many people would like to live there, but can't due to the work constraints. Imagine the savings that a major company could have if they moved from a place like silicon valley to somewhere like Kentucky. Land can be had for $500 an acre, cost of living is lower and could greatly reduce salary requirements, and you can still have this while being less than an hour from a major city (or two).
  - em-bee 6y ago
    ah, yes, for a company that people want to work for that makes sense. i misread your post and thought you meant for the government to motivate the building of housing in cheaper areas. unfortunately it's often either one or the other, but not both. most places i have seen are satellite cities where people live but commute into the actual city center, or they are industrial parks without any living quarters nearby. it takes a lot more to make such areas attractive.

bane 6y ago

A sorta aside. The absolute best AirBnB experience we ever had was in Vienna. Of course it's an anecdote, but we had absolutely no trouble finding convenient, cheap, and large places to stay under $70/night. This made us think that the housing market there must be quite cheap compared to where we're from. We ended up staying in an absolutely beautiful flat about 20 minutes from the city center via U-Bahn for <$60/night -- a price we've paid for old bedrooms in lesser cities. The same flat where we live would easily cost closer to $3k/mo.

tom_mellior 6y ago
Thanks in part to AirBnB, that apartment is approaching 3k/mo in Vienna as well.

arcticbull 6y ago

Singapore does something similar, with 80% of the population living in HDB accommodations [1]. The other 20% is a free-for-all near as I can figure. [1] https://en.wikipedia.org/wiki/Public_housing_in_Singapore https://en.wikipedia.org/wiki/Public_housing_in_Singapore

Barrin92 6y ago
I think Singapore also has some particular relevance to the US because of its multi-ethnic nature. Often when I talk to Americans about public housing a really common argument is the image of public housing as a sort of racist thing that creates enclaves for certain (usually low-income) groups. Yet Singapore, with its integration policies has virtually completely avoided this, and it basically can only do it effectively because it controls the housing stock. It's not a utopia but the degree to which people intermingle and live together is quite astonishing if you're used to French Banlieues or the segregation in many American cities today.
- rsj_hn 6y ago
  Singapore is "multi-ethnic" in the sense that it broke off from nearby Malaysia in order to have a Chinese majority city state, and adopted explicit policies to try to manage the Malay and Indian population in order to ensure that it is an ethnically Chinese run government. You can listen to some of Lee Kuan Yew's speeches to see how multi-ethnic it is, and what he thought of the US approach to diversity -- e.g. "multiculturalism will destroy America." (https://www.forbes.com/sites/realspin/2013/02/13/singapores-lee-kuan-yew-talks-americas-strangths-and-weaknesses/?sh=6e36af3033d3 https://www.forbes.com/sites/realspin/2013/02/13/singapores-...) The "integration" policies you refer to are there to limit non-chinese representation -- in the US we would call it a gerrymandering-support policy. Singapore also has an immigration policy meant to attract successful entrepreneurs, with no citizenship path for cheap labor, only temporary work visas. It does not accept any refugees or political asylum seekers. Being born in Singapore doesn't make you a citizen (no soil-based, only blood-based criteria).
  - Barrin92 6y ago

deleted 6y ago

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peter_d_sherman 6y ago

>"Vienna provides an interesting counterpoint. Because rent control disincentivized the private development of rental buildings, landlords were, for a time, removed from the market for urban land. Consequently prices finally went down, allowing the city to buy land at a much reduced price; often it was the only buyer in the market." PDS: An interesting cycle (or set of cycles) of cause and effect... Disclaimer: I am neither for nor against rent control...