Skip to content

Gov't study says Helsinki's housing shortage can be solved with more construction

Communities in the greater Helsinki region need to build more housing, according to the results of a government study that looked at why it is so expensive to live in the metropolitan area.

File photo of aerial view of Helsinki. Image: Jouko Tapper / Yle

According to a parliamentary study, cities and municipalities in the greater Helsinki region should improve their strategies for the construction of more homes at a faster pace, in order to combat constantly-rising housing costs.

The study, carried out by a parliamentary committee and completed this summer, says that a main way to curb rising housing costs is for capital area municipalities to improve planning efforts and increase the pace of building more housing.

The authors of the report say that even though discussions about Finland's housing policy usually concentrate on the capital region, even though many growing communities across the country also face the same issues.

Committee: More housing

The committee's first recommendation is likely expected by most people familiar with the issue - more housing should be built in the capital area, saying the pace of housing construction in Helsinki has been particularly slow.

In the report (siirryt toiseen palveluun), the authors said: "As the rates in growth centres have increased more rapidly than in other parts of the country, a part of the population faces a risk of being excluded from the housing market entirely unless they receive support from society. Every person must have the opportunity to find housing."

The demand for apartments in Helsinki has outpaced supply for a long time now, according to the study, and during the 2000s there had not been enough land earmarked for construction of new housing.

Suggests solutions, planning, reforms

However, the authors write, Helsinki has already begun to address the issue with its plans for shaping the city's future overall, as well as with its traffic and public transportation plans.

The study says that the metropolitan Helsinki area needs some 15,000 new homes built every year. Across Finland, it recommends, some 700,000 new homes should be built by the year 2040.

Last year Finland's Social Insurance Institution Kela handed out some two billion euros in housing benefits to people across the country last year, with some 860,000 residents having received housing assistance in some form during that time.

In order to combat the growing rent costs in general, government already has plans to cap the amount of housing assistance euros which can be granted.

The study's authors said that Finland's current housing assistance system works overall, but should be reformed in some ways.

One of those recommended reforms would be to give direct support to people who could not otherwise afford to live in the capital area, saying that the support should be adjusted to actual market prices in the city.