What NS Could Learn from Vienna’s ‘Red Housing’

When it comes to social (or “public” or “subsidized”) housing, Vienna really seems to have its act together.

I am tempted to present this information as though I’ve long been an admirer of the social housing of Vienna, but the truth is, I hadn’t realized it was a claim to fame for the Austrian capital until CBU Professor and housing advocate Catherine Leviten-Reid told me so. We were discussing how the Province of Nova Scotia might pay for the 30,000 units of affordable housing called for in a recent report, “Keys to a Housing Secure Future for All Nova Scotians,” which she’d helped write for the Canadian Centre for Policy Alternatives, Nova Scotia (CCPA-NS).

One of the suggestions contained in the report is a 1% payroll tax — half of which would be deducted from wages, half matched by employer contributions. Leviten-Reid said it could be thought of as a “solidarity tax,” and that it was used in Vienna to fund its “very strong social housing program” that builds “about 5,000 units a year.” (The tax is worth about $300 million a year to the city.)

According to this (undated) article in an online publication called PD&R Edge:

Vienna’s legacy of giving high priority to providing high-quality housing for the working class dates back to the “Red Vienna” period of the early 20th century, when the majority socialist government made providing quality affordable housing for city residents a priority. Vienna remains committed to this cause to this day.

 

 

The Tourism Vienna website notes that between 1923 and 1934, during the First Austrian Republic, the Social Democratic government of Vienna, with the participation of 400 architectural offices, built 61,715 apartments in 348 housing blocks and 5,227 apartments in 42 terraced house developments. “Austrian fascism” ended the “red housing” construction, but in 1947, following the Second World War, the city of Vienna “took up its social construction projects again” and has continued them to this day.

The city now owns and manages about 220,000 housing units, or 25% of the city’s housing stock, which are “meant primarily for lower-income residents.” But, as PD&R Edge explains:

The city also indirectly controls 200,000 units that are built and owned by limited-profit private developers but developed through a city-regulated process. Vienna adopted the latter approach in the 1980s, when it decided to collaborate with the private sector to build affordable housing rather than developing and owning more public housing. The city buys land deemed suitable for residential development and retains control over the type and nature of development. The city then solicits proposals from various private developers, which will build and retain ownership of the housing units. A jury evaluates these proposals based on four criteria: architectural quality, environmental performance, social sustainability, and economic parameters such as proposed rent levels and costs. After the jury selects a developer, the city sells the land to the developer at an affordable price. In addition, the city gives the developer a loan with favorable terms such as low interest rates and extended repayment periods.

It is not lost on me that Vienna’s approach involves private developers so clearly, there are ways in which they can be involved that actually result in the creation of long-term affordable housing, but the secret seems to be to keep them on a short leash:

Private developers who collaborate with the city government to build affordable housing must allow the city to rent half of the new apartments to lower-income residents; the developer generally leases the remaining units to moderate-income residents. In some projects, future tenants participate in the planning, design, and construction process and give input on what kind of facilities they would like to have in the building.

To put that in perspective, if we had rules like this in place here in Nova Scotia, then the BANC Group, which has been given a $1.15 million low-cost loan by the federal government to build a 324-unit apartment complex in Halifax, might have to let the municipality rent out 162 of those units to low-income tenants in perpetuity instead of agreeing to keep 76 units “affordable” for 21 years.

And speaking of “affordable,” Vienna has a much better definition of what constitutes “affordable” than we do:

Rents are regulated by the city government so that none of the residents pay any more than 20 to 25 percent of their household income for housing, compared to the corresponding 30 percent benchmark in the U.S. A unique feature of Vienna’s social housing program, Lindstrom noted, is that the city’s income restrictions for subsidized units only apply when families first move in. Residents are never required to move out, even if household income levels increase in the following years. This arrangement results in a substantial number of moderate-income residents living in subsidized housing, and this mixing together of residents with different income levels helps with social integration. Since the city has a large stock of affordable housing, these middle-income residents typically do not crowd out lower-income residents. Because the city continues to add new units that are subsidized, about 5,000 annually, and available to lower income residents, housing developments do not devolve into middle-class enclaves nor do they become stigmatized concentrations of poverty.

 

Kabelwerk and Wohnpark Neue Donau

Another interesting aspect of Vienna’s social housing projects is that they include a variety of types of subsidized rental housing within a given development. Take the 1,004-unit Kabelwerk project, for example. It includes “subsidized rental housing, subsidized owner-occupied homes, apartments for refugees, and student housing,” some of which — the student housing, for instance — is intended for short-term stays. (The website says it’s also suitable for business travelers, explorers and people who have recently been divorced.)

The Kabelwerk project covers about 7 hectares, the site of a former cable and insulated wire factory, and includes amenities like “shops, restaurants, a kindergarten, meeting rooms, and a rooftop pool” which “enhance the quality of life for the residents.” (Interestingly, all of these amenities — including the pool — were to be found in the original First Republic projects too.)

 

 

Another example, the Wohnpark Neue Donau, is built along the Danube and has been designed such that “virtually all of the 850 apartments” have a water view from their living rooms and balconies:

The buildings step down toward the river, creating roof top terrace apartments. Ground floor units have wall-enclosed private gardens especially suited to families with small children.

These developments — both the more recent ones and the original 1930s buildings — have so little in common with North American “social housing projects” that it seems worth pondering the difference.

Leviten-Reid says it’s a question she discusses with her students — why are there so many negative associations with public housing?

Often a lot of it comes from these massive complexes that were developed in the United States, so we have to ask, why is the model so controversial? Is it because of a lack of investment in public housing over a series of years that has led to poor-quality housing?

One culprit, Leviten-Reid suggests, might be a lack of tenant engagement in Nova Scotia. Each of the province’s five Housing Authorities “has a couple of seats for tenants” but the tenant reps are appointed, not elected by their fellow tenants. She contrasts this with Toronto where, she says, they have:

…really active engagement of tenants that’s supported by Housing Authorities, so they have elected tenant representatives at building levels and neighborhood levels and kind of on regional structures as well.

Leviten-Reid wonders if a lack of tenant engagement here means tenants “can’t vocalize how they want to make that housing better?” (The description of the process through which Vienna’s Kabelwerk project was built includes multiple instances of public consultation.)

Or if, perhaps, the problem is the lack of services in the neighborhoods where public housing is found.

Whatever it is that leads to these negative associations, she thinks they should be dealt with rather than looking for alternatives to public housing. That, she says, would be “throwing the baby out with the bathwater.”

(Next week, in my fourth and — I think– final article based on my discussion with Leviten-Reid I will tackle a big factor in the housing crisis: financialization.)