Saturday 24 August 2019

Finnish model may be key to solving housing crisis

'The Housing First model involves replacing old-fashioned hostels, for example, with purpose-built housing units.' (Stock picture)
'The Housing First model involves replacing old-fashioned hostels, for example, with purpose-built housing units.' (Stock picture)

Ailish O'Hora

Let's get one thing straight first - there is no quick or cheap fix for the housing crisis. And while that is little succour for those unfortunate to be caught up in it, the reality is that we are not alone.

A new report from the Housing Europe Observatory, the research arm of Housing Europe, has revealed that in the two years since its previous report, housing markets across the European Union have started to speed up again.

You might rightly wonder what's new here?

But the report does include one particularly interesting nugget - Finland is the only country in the EU which has managed to reverse the trend of growing homelessness.

It's not surprising really. The Nordic countries are often singled out for getting it right across a range of policies including childcare and transport.

The so-called 'Nordic Model', common to Sweden, Denmark, Finland, Iceland and Norway, involves a combination of free-market capitalism, collective bargaining at a national level and a comprehensive welfare state. It began to gain attention after World War Two.

Of course, inhabitants of these countries generally pay higher taxes for the services they get - but we'll come to that later. That's not to say that Finland escaped the economic crash that we in Ireland also experienced.

It experienced a boom period in the 1980s and a subsequent slowdown in the 1990s following a collapse in Soviet trade and recession in Western Europe.

More recently, it shook off recession following the financial crisis but the IMF recently warned that if growth levels and the welfare system are to be maintained, the country must take action to improve productivity and the employment rate.

But since 1999, despite economic pressures, the country has also attempted to focus on the elimination of homelessness as part of government policy.

So as our housing crisis shows no signs of abating any time soon, let's look at the Finnish model and how they managed to buck the homelessness trend.

For a start, like Ireland, Finland adopted a Housing First model, albeit quite a while ago.

That involved a move from the so-called 'Staircase Model' that traditionally involved providing accommodation in a series of stages after the homeless service user demonstrated an ability to move to a different level of housing, either as part of a rehabilitation programme or targets agreed jointly.

The Housing First model involves replacing old-fashioned hostels, for example, with purpose-built housing units.

The last large homelessness hostel in Helsinki, which had 250 bed places, was run by the Salvation Army until a couple of years ago.

It was renovated and is now made up of 80 independent apartments with staff who live on site.

In addition, temporary solutions, like hostels, have nearly all been removed and this has changed Finnish homelessness policy in a positive way, particularly in the combating of anti-social behaviour and the treatment of vulnerable people.

After years of attempting to solve its homelessness crisis, by 2015 the number of single homeless people was under 7,000 for the first time in Finland (this number included people living temporarily with friends and relatives).

Finland has a population of 5.5 million. Out of a population of 4.7 million here in Ireland, homelessness reached a record high at the end of last month, with 8,374 people being without homes around the country, figures from the Department of Housing have shown.

The number is made up of 5,250 adults and 3,124 dependents - this is a rise on the August figure of 8,270.

The number of people registered as homeless in Dublin has also risen and is now close to 6,000.

These are arguably crude comparisons and, of course, the Finnish model is not perfect; homelessness has not disappeared and the issue of the long-term homeless is still a problem.

It also goes without saying that you can't offer people social housing when it doesn't exist, as is the case here in Ireland.

However, what we can do is try to strike a better balance between the private and public sectors in the provision of housing.

Remember, the State practically stopped building houses even when the country was awash with cash.

One of the underlying issues here is the view that your house is your wealth - which it really is, given our relatively low-tax system that is not designed to cover healthcare or education fees, for example, which are factored into the Nordic model.

Here in Ireland, every man, woman and child is worth €140,000 but half of that is invested in property and most of that is the residential home.

Our model is market-based but what we do have now is a chance to take a more European approach and create a model that is fit for the 21st century.

But that's a big ask and it would involve a change in mindset - and a significant one.

Having said that, some market conditions favour a more European approach for the first time in a long time.

Today, home ownership is down and rental is up, notwithstanding the problems in the latter market.

No policy model is 100pc perfect and whichever one we adopt won't be cheap to introduce.

But there is plenty of evidence from many countries that it is more cost-effective to end homelessness, rather than just trying to manage it.

It may be some time before there are opportunities for selfies in hard hats and high-viz jackets - but that's not the priority.

Sunday Indo Business

Also in Business