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mortgage interest deductibility) encourages it, undermining the attraction of rental
investment. 52
30. Some European counties (such as the Netherlands and Sweden) employ a
rental subsidy system to encourage rental developers or private owners through
reduced interest programmes. 53 The long-standing subsidization scheme in
Germany for both the social housing sector and private investors laid the foundation
for a large private rental housing market.
31. In Austria, a sustained combination of supply-side polices has resulted in a
large housing stock with reasonable rents, allocated to middle-income groups with
additional means-tested benefits for lower-income groups. By providing discounted
building land, grants, public loans and tax favoured investment, the federal, regional
and municipal governments have strategically promoted the development of limited
profit, cost-capped, and cost-rent housing, catering to a range of households
including low-income households. 54
4.
Demand subsidies
32. Some countries have been implementing rent assistance programmes in order
to address affordability problems (see A/HRC/13/20/Add.4, paras. 10 and 25). 55
However, evidence indicates that such initiatives, in the absence of other policies
regulating markets and assisting recipients of housing allowances, are not sufficient
to provide adequate and affordable rental housing for low-income households. In
countries in which rental supply is limited, subsidies schemes actually lead to an
increase in rental prices 56 and shortages of rental stock for low-income earners. 57
Low income households receiving housing benefits often face difficulties in finding
and keeping habitable accommodation in adequate locations with access to services,
despite the extra purchasing power, owing to the low value of the benefits (given the
rise in rental prices) and discrimination against vulnerable groups in the private
rental market (see A/HRC/13/20/Add.4, paras. 17-26). 58 In addition, means testing
for housing benefits is often complicated, targeting is not always effective and
allocation procedures encourage corruption. 59 The tight conditioning of housing
benefits on income levels has been criticized for failing to reach all beneficiaries
(for example, only 40 per cent of private renters living in poverty in England are in
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53
54
55
56
57
58
59
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Pomeroy and Godbout, “Development of the rental housing market” (see footnote 50 above),
p. 20.
According to the response received from Slovakia to the questionnaire on security of tenure sent
by the Special Rapporteur on 22 March 2013.
Wolfgang Amann, Julie Lawson and Alexis Mundt, “Structured finance allows for affordable
rental housing in Austria”, Housing Finance International, vol. 23, No. 3 (June 2009), p. 14.
According to the response received from Finland to the questionnaire on security of tenure sent
by the Special Rapporteur on 22 March 2013. In some countries, housing benefits took the form
of vouchers — a method that has been used in the United Kingdom and in the United States for
many years. See L. Winnick, “The triumph of housing allowance programs: how a fundamental
policy conflict was resolved”, Cityscape, vol. 1, No. 1 (September 1995), pp. 95-121.
“Housing benefit cuts”, Crisis Policy Briefing, May 2012. Available from http://www.crisis.org.
uk/data/files/publications/Crisis%20Briefing%20-%20Housing%20Benefit%20cuts.pdf), 9.
Dugald Monro, “Public rental Housing policy: learning the lessons from overseas”, Research
Paper 6, 1997.
See also Kemp, “Low-income tenants” (see footnote 40 above), p. 1025.
Council of Europe, Housing Policy and Vulnerable Social Groups (Strasbourg, 2008), p. 50.
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