Helsinki’s housing shortage, while city-leased flats sit empty

City employees in Helsinki have the option to rent cheap housing, no deposit required - but many properties are simply left vacant.

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File picture of Helsinki houses and apartments / Credit: iStock

Apartments in Helsinki meant for city employees are routinely left vacant, even though affordable rental properties in the capital city are in short supply.

Deputy Mayor Pia Pakarinen (NCP) says she wants to find out what the problem is.

“We will have a meeting with the city’s apartment rental services on this topic and I hope that we will find solutions” Pakarinen tells Helsingin Uutiset.

Apartments reserved for city employees are significantly cheaper than other rental apartments in Helsinki.

For example, a 42 square metre one-bedroom apartment in Etu-Töölö neighbourhood coasts €790 per month.

For the same price at market rates, renters would get a studio flat, at most.

Despite this benefit offered by the city to employees, many rent-controlled flats are still vacant.

At the end of 2018 around 260 of the apartments were available.

At the same time, thousands of housing applications are pending – at the end of September 23,000 people were seeking housing solutions from Heka Oy, Helsinki’s housing authority.

File picture showing detail on exterior of Helsinki City Hall / Credit: News Now Finland

Cheap properties for city employees 

The majority of accommodation reserved for Helsinki City employees, about 1500 apartments, are occupied by social services and health care workers. Another 500 are occupied by workers in education; while the remaining 40 are earmarked for tenants who work in the cultural and leisure sectors.

Pia Pakarinen says there is a desire to get rid of sector-specific allowances so that renting would be more flexible.

“In the future, all homes will be in one joined-up pool, which will make renting more flexible and will contribute to more efficient occupancy” she explains.

There are also plans to waive the fixed-term employment relationship.

Currently, apartments are rented for a maximum term of five years. After that, the lease can be renewed for a maximum of two more years.

Pakarinen suspects that fixed-term leases might have reduced the attractiveness of the apartments for employees who don’t want to be locked into a long lease.

“It is much more sensible to tie the tenancy to the employment relationship
itself. Already this will change the situation a lot” Pakarinen says.

According to Pakarinen, it is also important that employees and job seekers are
given more information about employment housing options upfront.

Especially in the field of education, employment housing is being made more visible to
job seekers.

“Of course, employment housing has been mentioned in job advertisements
before, but in the future they will be mentioned much more prominent in the marketing of
jobs as well.”

“It is a pity that this asset has not been used more efficiently in the past, especially when there’s been a shortage in staff for many years now” says Pakarinen, who is leading the city’s education division.

City Councilor Martina Harms-Aalto (SFP) recently proposed an initiative to increase the amount of employee housing available in Helsinki.

The council didn’t think it was necessary, since there are currently apartments sitting empty.

“The city government wants to monitor the impact of cutting the maximum tenancy terms, to see the impact on employee housing” says Pakarinen.

“Fortunately, we are building a lot of new residential areas, where more employment housing can be built if the need arises.”

Facts about city-owned accommodation 

    • Most flats are studios and one-bedroom apartments;
    • The City of Helsinki has a total of 2,653 employment housing units in different
      occupations, with 6.9% of the city’s personnel living in them;
    • The owners of the housing units are the Regional government office, Apartment rental agency and real estate agency Auroranlinna;
    • Most of the apartments are studios or one-bedroom apartments.
    • Employment housing units are located around the city and the rental price of the apartments per square metre varies from €10.56 to €21.91 euros per month depending on the size and location of the dwelling;
    • Employment housing units are located in the inner city and not only in the
      suburbs;
    • Clearly lower-than-market rent is charged directly to the employee’s monthly salary and no security deposit is required for the apartments.
File picture, aerial panorama of Helsinki / Credit: iStock