Housing policy: Who Does It Best? - Part 1
Why is your rent so high? What are the policies that created this housing crisis, and what policies can get us out of it? This week we launch the first two parts of our new series, ‘Who Does It Best?’. At a time when many people feel like their governments are not taking care of them, we wondered: how do policies actually shape our daily lives? And are there places getting it right?
In Housing Part 1, Katz takes us on a journey through Vienna, Finland, and Paris, looking for Europe’s most ambitious housing policies and what we can learn from them (and maybe even copy?!). But first, Katz and Dominic sit down to face the elephant in the room: money, housing, and inheritance.
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Dominic: This episode of The Europeans exists thanks to you, our amazing listeners. Every bit of it was funded by your support. Thank you all so, so much. If you aren’t donating yet, please consider supporting our independent journalism by heading to patreon.com/europeanspodcast.
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Dominic: Hello everyone and welcome back to The Europeans! My name is Dominic Kraemer, I’m one of the hosts of this show and I am very excited to be recording today, because we’re here to kick off our brand new series: ‘Who Does It Best?’
Katz: Eee!
Dominic: Heehee! It’s the first time we’re making a mini-series that is crowdfunded by our listeners. Thank you all so much. And that little ‘hee’ you heard was from our producer and the reporter of today’s episode, Katz Laszlo. Hi Katz!
Katz: Hello! Yes, it’s big launch day, it actually worked!
Dominic: It did, can you believe it?
Katz: Not quite.
Dominic: It’s now the moment for you to let all that stuff out of your brain that you’ve been learning about for many many months.
Katz: Ooh, what am I gonna do with all this new real estate?
Dominic: We’ll find out. But I guess before we do find out, I should probably start by explaining what this series is and why we wanted to do it.
Katz: Yes please.
Dominic: Well, ‘Who Does It Best?’ has been in the works for a while. It’s a series that we thought was really important to make at this specific point in history, when so many people are disengaging from politics because they see it as a power game between men in suits – often men – whose reality seems so far away from a normal person’s daily life.
Katz: Yeah, we started to talk about how it’s a strange moment where there’s all this polarisation and then all of this talk of geopolitics, and at the same time it feels like across the political spectrum, people aren’t really feeling like they’re being taken care of by their governments. Like, nobody feels like they’re being listened to.
Dominic: Yeah, in an ideal world governments help us.
Katz: Yeah, ideally they would be making our lives easier, not harder.
Dominic: Indeed. And in this series, we’re not just gonna bash governments. We mainly want to find examples of policies where our lives are being made better, in a way that people can feel.
Katz: Yes please.
Dominic: And these policies that shape our daily lives can look wildly different depending on where you live.
Katz: Yeah, I think that’s something we’ve all noticed, moving around this continent. That like, wow, the way that these countries are organised is much more varied than you might think.
Dominic: You’re right, we’re not just this one homogenous mass of European states, things are quite different from country to country. And makes Europe a perfect place to ask a simple question: who’s actually getting it right? Or… Who does it best?
Katz: Very smooth.
Dominic: So, over the next few weeks we’ll explore three areas that touch our lives: housing, childcare, and drugs policy. In each episode we’ll search for the places that have figured out how to meet some of our most basic needs – both as individuals and as a society. And today, we’re kicking off with a biggie – it’s housing week.
Katz: Yes! A biggie indeed. Housing is a huge talking point all over Europe. People are talking about it a ton amongst each other.
Dominic: Mm hmm.
Katz: Most newspapers have an article about it almost every day of the week. And you can really see it spilling over. Like, more and more cities are struggling to find enough teachers, hospital workers, people who keep this city going, because the people who are paid less just cannot find a house. Research shows that housing insecurity is driving people to decide to delay or not even have children. Then there is the climate crisis: people who live in the home that they own are much more likely to invest in making their homes more sustainable. Landlords are not.
Dominic: Makes sense.
Katz: I know.
Dominic: Sadly.
Katz: And housing energy is about 26% of our emissions. That footprint is similar to our whole agricultural system.
Dominic: Woah!
Katz: Yeah, so it’s really not nothing. Lastly on that very jolly list –
Dominic: So jolly.
Katz: The UN released a report that the housing crisis is directly driving people in Europe to elect far-right governments.
Dominic: Wow. So… Solving this housing crisis might actually be a solution to what feels like the current endless swing to the right?
Katz: I mean, I’m sure it wouldn’t solve everything. But the UN special rapporteur suggested it is one of the factors. It’s also just really hitting people on a personal level. If you have housing stress it takes up so much of your brain. It influences what kind of work you can choose. And it’s been a serious problem for over 20 years. And as much as we’re talking about it, things only seem to be getting more dire, and people on the losing end are more and more frustrated. Like, why doesn’t it seem to be getting any better? On average, housing prices in the EU rose almost 50 percent in the last decade. And in some places it’s even worse. Like, in the Czech Republic and Hungary, it’s more than doubled.
Dom: Meanwhile our salaries have not.
Katz: No, definitely not. And I mean, what could we, as this podcast, possibly say about it that hasn’t been said?
Dominic: I’m sure you’ll find something.
Katz: Yes, it turns out I’ve found quite a lot. So we’ve turned this episode into a two parter.
Dominic: I’m excited to find out more. And thank you to our crowdfunders for making such a deep dive possible, and allowing Katz to make two episodes for the price of one.
Katz: Get your episodes, people! It actually reminds me a bit of climate journalism – you’ve got this huge, overwhelming, complicated problem that has a really big impact on us, and you hear all of these things we should do differently. Like, plastic straws bad, flying bad, cheese bad.
Dominic: Right, and as a citizen trying to do their best, it’s really hard to tell what in the public debate is important and what is a bit of a distraction.
Katz: Exactly, and like, both at an individual level, like what am I doing that’s having a big impact? And also at a systemic level. Who is driving this crisis and what policy changes would have a serious impact?
Dominic: Yeah, I definitely recognise that with climate discussion. Like, so many newspaper column inches about plastic straws, but the plastic straws – or getting rid of them – is not gonna save us.
Katz: No, and it’s just really numbing. And the result is that we don’t solve a problem that we do actually really need to solve.
Dominic: Mm hmm.
Katz: And it’s the same with housing policy: what is super important and what is sort of minor? After months of talking to housing experts and economists, I came to the conclusion, most of us are not having the right conversation at all when it comes to housing. Which was both frustrating, as in, I felt cheated as a citizen – like, I’m making a concerted effort to inform myself, it’s an issue that I care about. Why did I not know half of this? And on the other hand, it made me hopefu. Because now that I understand this, there’s a whole universe of solutions opening up.
Dominic: Ok, this sound both ominous and kind of hopeful and promising, which is kind of just the combo I’ve come to expect from you, Katz.
Katz: I’m not sure how to take that.
Dominic: Sorry. I mean, before I started this I was kind of half expecting this to be an episode about like, beautiful forms of social housing architecture. But I have a feeling it's not going to be that, right?
Katz: No, I'm going to be taking you on quite the journey. And it turns out that to try and figure out who has the best housing policy, you have to look at the question of who exactly is it good for. You and I, we both happen to live in Amsterdam, but we've had very different experiences of housing in what is one of the most expensive cities for housing in Europe.
Dominic: Right, yeah. And we're both in our thirties, but you are renting and have roommates. Meanwhile, I own a home with my husband. And the only reason I'm lucky enough to own a home is that I married someone who got financial support from their family. And he bought a house about 10 years ago when house prices were much lower than they are now. And that meant we got this foot onto the property ladder.
Katz: Yeah, and literally the whole time we've known each other, (6:54) I've had to hop from house to house. Because with my income, even getting a permanent rent contract was incredibly difficult. I didn't have one for over 10 years. And I also didn't receive family money to buy a house.
Dominic: Yeah, and this family money thing, that's quite often the elephant in the room. Whether that's inheritance after family members pass away or in the form of gifts when they're still alive.
Katz: Yeah, and these are pretty sizable gifts. It's common for people to receive tens, sometimes hundreds of thousands of euros to help them buy a house.
Cody: You see this across all countries, that it's rich young adults from wealthy backgrounds that are still buying and other ones, much less so.
Katz: That's Cody Hochsenbach. He is at the University of Amsterdam and he's written two books on housing.
Cody: And you also see they're receiving increasing amounts of money. So it's not that more people are receiving parental support, but the support itself is also increasing in size. So it challenges this very dominant worldview that of individual success and individual failure.
Katz: That is the first thing my reporting taught me. When we talk about housing, what we're actually talking about is wealth inequality. And the reality is, our current housing policy makes wealth inequality a lot larger. That's what this is really about. Homes have become so expensive that if you don't have one already, you are unlikely to be able to afford the down payment on a house in pretty much any European capital city, unless you have family money or a really exceptional income. And well, as someone who isn't in that position, that's pretty damn frustrating. Like, you are just miles behind from the get-go and it's up to random things that you can't do much about. We are living in what people are calling an inheritocracy.
Dominic: Inheritocracy. That's a nice new word to add to my vocabulary.
Katz: Yeah, it was new for me too. Lovely.
Dominic: And Katz, is this particularly extreme in our generation? Like, I feel many of our parents' generation were, you know, able to buy a home for like 17,000 euros as a teacher or something.
Katz: Oh, those were the days. Yes, it absolutely is. Housing has become the dividing line in our generation. I didn't know this, but of any generation currently alive, millennials have the most wealth inequality and inheritance combined with housing has become the main driver of that inequality.
But here's the thing. There is a massive social taboo around talking about family money. People who've been given help to buy a house have a hard time admitting it. And people like me who haven't had that help feel awkward about talking about it with friends that have. Like, even amongst our own team, I said, ‘Ok, great, I'll do the reporting on housing,’ and I started looking into it. And I immediately realised like, oh, this is about massive housing inequality that also exists on our team, that we never said out loud until this project.
So I'm going to have to name it for the first time, at the same time as explaining that this is a way bigger difference than most of us realise or want to admit in a meeting where everyone owns a home except for me. And talking about it has sometimes felt hard and painful and awkward. And to be completely honest, I didn't really see that coming when I said, ‘Ph, I'll do housing.’
Dominic: Yeah, it caught me off-guard too. But right away at the beginning, I think you and Katy, I remember in that conversation, you and Katy were like, ‘Well, maybe this is the conversation we should have on the episode.’ And I found that a bit terrifying.
Katz: I don't think you're the only one. Yeah. For me too. It's not just the not talking about it. Like, I just hadn't really thought about it like this. Like, I know you own a home. That's not news to me. I know that I don't. That's also not news to me. But I'd never really sat with like, what that means for our current finances and also what that means for our future prospects. And it was really only in this episode that that really landed with me. Like, wow, we're in really quite a different position, at least now. And like, why? What was that? What is up with that cognitive dissonance that I didn't land more?
Dominic: And I realise there are probably a lot of homeowners out there thinking, ‘Hey, I also struggle. I have a mortgage to pay and I have trouble paying my monthly bills too.’ But ultimately, homeowners, including myself, at the end of it I'll get to own the roof over my head, which is a massive economic advantage over you.
Katz: Yeah. And I mean, it's a real thing. Like, I see people really struggling to pay an insanely high mortgage or they get divorced or someone passes away.
And my heart goes out to these people. Like, that struggle is real.
Dominic: Yeah. But a lot of people who talk about struggling with their monthly mortgage bills or their money only being in the bricks, they're not really in such a dire position, at least relative to renters. Because regardless, they do have an asset. The whole thing is just totally unfair.
Katz: And what I noticed in this process is if we own a home, we tend to think, ‘Hey, but that person owns a bigger home, or they bought sooner and they've made even more profit. And that's true, but it's like a tiny detail in comparison to the bigger picture. And then you hear someone saying like, ‘Oh, but my money and my bricks doesn't really count.’ And then all of a sudden you're like, ‘Well, hang on a minute. I'm paying half of my income into someone else's pockets. Don't even have a prospect of buying a home.’ And then the whole thing can get a bit mad and tense.
Dominic: Yeah, and I guess that's one of the reasons why people don't talk about it.
Katz: Exactly. So we're trying to do something different here. These might feel like personal little phenomenons, but these differences between these different groups and the patterns and how we talk about it, they came up in nearly every interview I did for this series. And this inequality is at the foundation of what we call the housing crisis.
Cody: This has been studied across Europe. Homeowners spent a significantly lower share of their income on housing than renters. So, 30 to 40 percent for renters compared to just 10 to 16 percent for homeowners. Plus, if you look at the trend in recent years, and this is also again a cross-European finding, is that homeowners actually spent a stable amount, a slightly decreasing share even of their income on housing. While for renters, this share has increased. So again, we see a situation here where the gap between homeowners and renters is widening.
Katz: At the end of the day, most of that money that you're paying every month, you will probably one day pass it down onto someone in your family or use it as a pension. Whereas I'm giving almost half of my monthly income to a massive public housing corporation that made 906 million euros last year alone. I won't be seeing any of that money again.
Dominic: Ooh, that is painful.
Katz: I know, it is. And the thing is, we obviously can't represent the entire housing spectrum between the two of us. And it's not like I'm an exceptionally miserable renter who didn't get money to buy a house. There is millions of people like me. Nor are you an exceptionally wealthy homeowner. But well, Dominic, you just happened to be the unlucky one co-hosting this podcast with me.
Dominic: Cast in the villainous homeowner role.
Katz: And you know, it is just an unfair system. If you have the money, it is a wise decision to own a home. But if the core is inequality, when we're thinking about who has the best housing policy in Europe, the better the housing policy, the smaller the inequality.
Dominic: Right. If this really is about fixing a fundamental inequality...
Katz: Yeah, then which places have done the best job of preventing that inequality in the first place? And who is doing the best job of bringing down that inequality in the future?
Dominic: So I feel like we've taken the first step in breaking the big taboo.
We're at least sitting down and we're talking about this.
Katz: Very grown up.
Dominic: And now we know what we're actually looking for, is there anywhere where there's less of a difference between the people who rent their homes and the people who own them?
Katz: Yeah, there is.
Dominic: Great, ok. Finally, I sense there's going to be some hope after all this inequality bleakness. I'm very ready for this. Tell me more.
Katz: Let's have some joy. So almost immediately after we launched the series, we got a ton of emails saying: Vienna. Vienna is the classic example of a city doing it right. And the main thing is that about 50% of Vienna's housing is social housing.
Dominic: Is 50% unusually high for a European city?
Katz: Yeah, it varies pretty massively. Some cities only have a few percent. And what social housing means per city varies quite a lot. What is always the case is it's for low income people. So, there's a maximum of how much you can earn to be eligible. And the rent price is capped by the government.
Dominic: That's clear.
Katz: But Vienna is definitely the highest, and you see loads of positive side effects. One of the keys is that the city is in a really strong negotiating position. They own so much of the housing that it is very difficult for investors or private landlords to drive up the rents or to lobby for policies that benefit property owners.
Dominic: That just sounds brilliant, and it sounds like… what's the opposite of a vicious cycle? A virtuous cycle?
Katz: That sounds good, a virtuous cycle. Another ingredient in this virtuous cycle is the maximum income for social housing is quite a bit higher than in other places in Europe. So that means more people have access to it.
It also means the difference in security between homeowners and renters is much smaller. Also, rented homes can be inherited, making it much more equal to home ownership.
Dominic: Now that's an inheritocracy that I can buy into.
Katz: Basically, social housing is just a fundamental part of the housing system that a whole range of economic classes live in.
Dominic: That sounds like how it should be.
Katz: Yeah, and that in turn means there's generally support for public investment in housing, both in politicians and in voters. So more public money for buying land, building, maintenance, the whole shebang.
Dominic: I mean, it totally makes sense. If more people are experiencing this housing as having a positive impact on their lives, then they're just more likely to vote for the parties that are going to protect it.
Katz: Exactly. I will say outside of the large social housing stock, Vienna is facing similar issues in the private rental sector. So, skyrocketing rents, people from abroad who aren't in line for social housing who just cannot find a house. Everything people in cities across Europe will be very familiar with. It's just happening on a much smaller scale because the private rental sector is a lot smaller.
Dominic: OK, so it's not a perfect case, but it is pretty solid. Katz, have you accidentally finished the episode?
Katz: No, of course not.
Dominic: Oh.
Katz: We're still going to be here for a minute.
Dominic: I'm happy to keep going.
Katz: Good. So I am not going to give Vienna ‘Who Does It Best?’ because I realise we don't have a lot to learn from them. The lesson is: do not sell your social housing. And I couldn't for the life of me figure out why Vienna chose to keep it – like, I spoke to quite a lot of people from Vienna trying to find the answer, and didn't really find one. And that's remarkable, because guess what? Almost every European capital city did sell off a lot of social housing, sometimes as much as half of it. And it would have been great if the rest of us hadn't done that, because then we would have been better off, like Vienna.
But we did. And now we're in this mess and it is very difficult or expensive to get this social housing back. So what Vienna is doing is really cool, but it also feels a bit like a ‘Who Does It Best?’ from the past. We're in just such a different starting point. So yes, the rest of us should really go back up to 50 percent social housing as a city. That would really help to shift the housing systems away from just making homeowners get richer and richer and towards the people who really need it the most. But well, how to get there and how to regulate a place where there's much more private rental? That's not something we can learn from Vienna.
Dominic: I feel sorry for Vienna.You're like one of those teachers who never gives a grade above 70 percent. Can I give Vienna some kind of medal or a ribbon or something for not selling off their social housing, please?
Katz: Fine, give them a medal.
Dominic: Ok.I now also do have a bunch of questions. I really want to know a lot more about how and why we lost all that social housing everywhere else, because I think a lot of other cities and countries in Europe had much more social housing than they do now.
Katz: Yeah, and it demonstrates something that basically everyone I spoke to really nailed home. Most of Europe doesn't have a housing crisis. It is a housing policy crisis. Meaning, the fact that people can't find affordable housing isn't just because of some natural phenomenon. It's because of political choices. It's actually in most of our constitutions that we have the right to a home. It's even in the Declaration of Human Rights. But that's not been the priority in recent decades for most European governments. Most of them have prioritised people making a profit, building more and more extreme housing wealth, rather than protecting people's right to a home. And that is a series of policy choices. So calling it a housing policy crisis instead of a housing crisis, it correctly names who is responsible. Because otherwise, you're just talking about it like a thing that has just happened as a natural disaster, you know?
Dominic: How long have housing policies actually been a thing? Like, how long have governments been thinking about housing as something they could intervene in, rather than leaving the issue to just sort itself out?
Amsterdam: Well, there I was on Sunday at Museum Het Schip. I was off work and a friend of mine was giving me a tour.
Dominic: Oh, I love Het Schip. It's this museum in Amsterdam that's like a museum of housing.
Katz: It's so relaxing. And the first minute I arrived, I saw in a leather-bound, yellowing book – drum roll, the first housing policy of the Netherlands.
Dominic: Ooh.
Katz: Here's Ton Heijdra, one of the founders of Museum Het Schip.
Ton:The industrial revolution. New factories were built everywhere, and the new factories needed workers.
Katz: It's the late 1800s, industrial revolution.
Ton: And where came the workers from? From the countryside. And they came to the city to have work, to earn something. They needed houses, and there weren't houses. So therefore, people stayed everywhere. Even half underground, they lived. And that was a problem.
Katz: All across Europe, people moving to the cities for work. Not nearly enough houses. I also spoke to Marie-Jeanne Dumont, a retired architect who studied the history of social housing in Paris.
Marie-Jeanne: Donc, il y avait une situation qui commençait à être explosive parce que les ouvriers…
Katz: The situation was really explosive. Huge numbers of people came to work in the factories. There were like 12 people sleeping in one hotel bedroom, people going in shifts, so some people sleeping in the bed in the night, some people sleeping in the day. Tiny slum houses with like 35 people living in them. It got so bad that across Europe, wealthier people and governments and employers started building housing.
Ton: They started to make something beautiful for the working class. That was a new idea.
Dominic: Why were they so benevolent?
Ton: It was also important to stop the revolution.
Katz: Well, they also started fearing a revolution.
Dominic: Well, ok, so somewhat self-interested.
Katz: Yeah. Unfortunately, there weren't enough semi-benevolent rich people building better housing for the workers. So there are all of these factory workers living on top of each other. And then along comes…
Marie-Jeanne: Une maladie urbaine très importante, qui est la tuberculose.
Katz: Tuberculosis.
Marie-Jeanne: C’est une maladie très contagieuse. Il y a 50,000 morts per an.
Katz: So many people are sick and dying that there are not enough workers to run the factories. And –
Ton: llnesses don't stop. Everybody can get it, even if you have more money. So it was for everybody important that people have a good house.
Marie-Jeanne: Donc, la contagion a obligé retrouver un certain solidarité sociale.
Katz: Marie-Jeanne says contagiousness forced people to rediscover a certain kind of social solidarity. So the richer people start dying, and that is when politics change.
Dominic: Classic.
Katz: And Europe's first housing policies are born.
Dominic: And what's in these first housing policies?
Katz: There's some variation per country, but a lot of what we take for granted was invented then. So, every home should have a tap with clean water, a toilet, multiple separate bedrooms for the first time, so people could be isolated from each other when they were sick. Another major upgrade: up until then, bathing was really expensive. And so wealthy people and workers alike only took a bath max once a month. So we invented a new cheap way of washing ourselves: showers!
Dominic: Showers.
Marie-Jeanne: C’est un sujet important !
Katz: Oui, c’est un sujet très important !
Dominic: Wow, that's really quite an upgrade from shitting in a bucket and 30 people sleeping in one bedroom.
Katz: It really is. And, ta-da! After all of these changes, tuberculosis magically dies down.
Dominic: Wow! I don't think it was actually magic, was it?
Katz: No, it was the shower. Once again, this goes to show everything is a policy choice, as in – tuberculosis happened naturally, but whether or not it turned into like a huge pandemic? That was determined by our housing policy. The other lesson from this story is: never waste a good crisis, Dominic. It is really a massive opportunity for transformation, if you choose it. Because after that, a ton of the social housing was built, a lot of which we still live in today.
Dominic: So what happened to all this lovely social housing? Like, why didn't it save us from the housing crisis we are in today?
Katz: Yeah, well, things begin fraying over the decades. In a lot of places, there's a housing shortage post-World War II. Loads of the houses have been bombed and the government didn't have the money to build new houses. Then later in the 1980s, neoliberalism chips away at the housing in Northwest Europe. A bunch of the social housing was sold off, renters' rights get cut back, squatting gets criminalised. At the same time, in Central and Eastern Europe, a lot of the socialist governments fell. For decades, family-owned property had been nationalised, but suddenly ownership of many things was possible, including housing. So some people got family homes back, others managed to buy homes in the 90s. And through that they consolidated a lot more housing wealth than people who didn't, which in turn they passed on to their children – either in the form of homes that they can live in, or homes that they can sell for more money.
Dominic: Inherited wealth rears its head again.
Katz: Yeah, there's a big difference in what inheritance looks like in these countries with only recently fallen totalitarianism, but it's there. Basically, all over in different ways, governments wanted to encourage people to buy homes rather than rent. So all over Europe, they gave homeowners a bunch of tax benefits. Remember that, it's coming back for us later.
Dominic: Noted. Okay, so that's the 80s and 90s, but things seem to have gotten significantly worse in the past couple of decades. Why is that?
Katz: Yes, why is that? So you have decades of deregulation that set the stage and then, boom, the 2008 financial crisis. That is the real driver of this current housing crisis that changed everything. Now, obviously, people have written entire PhDs about how the financial crisis affected housing in each country in Europe, but for a quick version: the banks crashed, and that looked different depending on the country. But all over, it also starts impacting people's mortgages, especially the people with variable mortgages. Suddenly, their monthly bills went up, sometimes doubled, tripled. Mortgage payments shot through the roof at the same time as people were being laid off en masse. So what happened is lots and lots of people started losing their homes. And meanwhile, as people are losing their homes and getting no help from the government, the government is bailing out the banks. People were absolutely furious.
Dominic: And Katz, you told me to never waste a good crisis, but it seems like 2008, which was a crisis, made things a lot worse, not better. We wasted that crisis.
Katz: There is one country in Europe that very much did not waste this crisis. Finland wrote a radical new policy, the Housing First policy, to eradicate homelessness completely.
Dominic: In 2008?
Katz: Right in time for the financial crisis.
Juha: Exactly, exactly.
Katz: Was it before or after?
Juha: It was during, during the financial crisis.
Katz: I got on the phone with Juha Kahila, who works at the housing union in Finland, and I was honestly quite flabbergasted. At the height of the financial crisis, the country decided to invest 270 million euros over 10 years into making sure that every single Finn had an affordable home, unconditionally. So in other countries, it often goes the other way around. If you're homeless, first you need to get a job or go to rehab and prove that you're over a drug addiction, all kinds of conditions. But Finland decided, let's give everyone a house first, and from there they can sort out the rest of their problems.
Dominic: That's so refreshing, both giving people a home unconditionally, and just the fact that they decided to invest money in welfare during a crisis and not cut back.
Katz: Yeah, it really is.
Juha: When people nowadays are saying that we don't have the money to do anything, but we were able to actually put quite a bit of money towards the Housing First model because we wanted to change the system. So it's about what you prioritise to do, more or less. And if you want to really do something, you can also find the resources to do it. And so I think the political will is one of the magic words here that needs to be there.
Dominic: Katz, he sounds like you. He's basically saying it's a policy choice.
Katz: Juha said this with a bit of a dry smile, but I mean, blink and you miss how extraordinary this is. Finland decided to prioritise spending money on securing people's homes at a time when a lot of governments were instead bailing out banks, and simultaneously making serious cuts to social support.
If you think about austerity, you know, elderly Greeks having huge sums of money taken off their pensions, it's just such a different value system.
Dominic: Yep.
Juha: Yeah, and it's interesting in the Finnish perspective that we had a housing minister who's from the National Coalition Party. It's on the right side of the political spectrum. And under his leadership, we were able to turn the tables around homelessness and start working with Housing First and put a lot of resources towards it and do the system change. So I think it's quite fascinating in a way.
Dominic: How is it that in the middle of 2008, Finland had enough political consensus to invest all this money in eradicating homelessness?
Juha: I think we have also been able to prove the case that when you take care of the most vulnerable people in your society, which usually are the homeless people, then it's good for the whole community. The cities, they are more safe places for everyone, and then more vibrant places just for everyone from right to left and everything between. This is probably the only thing that all the parties agree. And I think it comes because, of course, we have quite harsh winters in Finland, so it's really cold in the wintertime, and if you don't have a home of your own...
Katz: To say the least, yeah.
Juha: Yeah, when we had back in the 80s, when we had 20,000 homeless people, people were really literally dying on the streets. So I think we have learned something from that.
Katz: I was really moved by this. It's definitely something I'd like to see more of us emulate, but I was also confronted by the simplicity and self-evident way that Juha put it. Because people die on the streets in the cold all over the world. That hasn't given most of us this grand moral wake-up call. It can't just be a conclusion of just the cold weather.
Dominic: Yeah, we also live in a country, you and I, that is often cold and definitely rich. And we don't seem to have come to that same consensus.
Katz: No, sadly not. Actually, homelessness across Europe has gone up 70 percent in the past 10 years, and in every European country except Finland, homelessness is only increasing. There are roughly 700,000 people sleeping on the street in our continent on any given night. And to make that even more painful, according to Investigate Europe, there's about 38 million empty homes in Europe. Not to sound like a broken record, but whether or not people are homeless is a policy choice.
Dominic: Right, so just statistically, all of these people could be housed, many without even having to share with housemates if we made different policy choices.
Katz: Yeah, which is not just morally painful, it actually doesn't make sense economically either.
Juha: It is cheaper, actually. They did a study in Finland in 2012 that proved the Housing First policy was in fact cheaper. Actually, giving people the home and the support they need instead of them being on the streets or in a shelter or in a temporary accommodation, we are able to actually save taxpayers money, 15,000 euros per year, per person.
Katz: Wow, that's huge. And when you say per person, do you mean per homeless person?
Juha: Yes, per homeless person. Great part is that this same kind of study has been made around Europe and it told the exact same story. There hasn't been any study that shows that it's actually more expensive to do Housing First. Some people, they don't care about the human aspect of housing as a human right, but they care about economics, and we have been able to prove both cases. So I think that that's why the political parties have also agreed that this is something that we need to do together in the future as well.
Dominic: Sounds a lot like the people after the Industrial Revolution who realised it was actually in everyone's interest to spend some money on this.
Katz: Yeah, and the thing is if the core goal of your policy is to eradicate homelessness, you wouldn't have a housing crisis anymore because you'd go straight to the root and create a system change.
Dominic: But can't you have a policy that eradicates homelessness but where rents are still out of control?
Katz: That combination is possible, yes. But if you fundamentally treat housing as something that everyone has a right to, rather than treating it as an asset, then all the policy around it will be, you know, ensuring enough homes, affordable rent, seriously investing in social housing and all kinds of things like that.
Cody: Focus is always on house prices, but that's a middle class focus. But the big risk is that when you frame it as a middle class problem, is that politics and other actors will also come up with middle class solutions. Homelessness, in my opinion, is much more important.
Katz: A lot of experts say that a part of this is because of stigma about who we think that homeless people are. And it's also tied into this story we have that we live in a meritocracy, like if you work hard, if you didn't make mistakes that were your own fault, you would have a home.
Dominic: Whereas we learned earlier, we actually live in an inheritocracy.
Cody: When we think of homelessness, we think of a drunk old man on the streets. Most people that are actually experiencing homelessness, you probably wouldn't recognize them on the streets.
Katz: Yeah, I was actually, I wanted to check that with you because there was a time when I really spent like a month here, a month there on people's sofas or spare rooms. And I thought, fuck, was I homeless and I just never identified with that word? Or is that really obnoxious and privileged? Or like looking back, had I not had the social network I had, had I not studied and therefore know people who do have a home… What do you think? Is that unfair to use that word?
Cody: You mean homelessness?
Katz: Yeah.
Cody: In this case? Well, in Dutch, we have this distinction between dakloos and thuisloos, which sort of translates as roofless and homeless. And roofless are really the people that are living on the streets or in the shelter system. And homeless are people that might have a roof over their heads, but don't have an actual home. So the second term applies to a large group of people, including you in your situation, I would argue. But yeah, it's a form of homelessness.
Katz: Yeah.
Katz: It was really weird to sit in an interview and hear from an expert that I was homeless. Like, I still feel some cognitive dissonance there, even though if you describe another person in that situation, it feels completely legit that they are homeless and should have access to serious resources from the state.
Dominic: Wow, yeah. I mean, I knew you were having a really hard time with housing and it seemed totally unfair the situation you're in. But I also hadn't considered that it was a form of homelessness.
Juha: When you say that, you know, they are staying with friends and relatives, some people might take it too lightly that, oh, well, then they are fine. Around 60 percent of the homeless population in Finland, they are actually people staying with friends and relatives. The Danish, when they do the homeless statistics every two years, they have found out that people who stay with friends and relatives, homeless people, they tend to have 60 percent more mental health challenges compared to the general population. So that's quite a bit.
Katz: That's huge.
Juha: Yeah. Exactly. So I think we shouldn't take it too lightly. It can be the first trigger of creating some challenges in their lives.
Katz: Juha and Cody told me that essentially the kind of homelessness I experienced is basically just an earlier stage. In fact, it's all steps away from a baseline functioning housing policy, one where everyone has an affordable home. Paying half of your income to rent a house where you have very few rights, that's one step. Not being able to rent, but staying with others, that's another step. Homelessness is at the end of that journey, but that is arguably a state failure.
Dominic: Yeah, it was a policy choice.
Katz: Yeah, and I mean, even if you don't share morals, Finland proves that housing first is in everyone's economic interest. So for the most precarious, the slightly less precarious and even the wealthy, because it saves taxpayers money. But Dominic, I'm not giving Finland ‘Who Does It Best?’ either.
Dominic: Katz! Why not?
Katz: Ok, fine. Finland is a partial winner for sure.
Dominic: Okay.
Katz: They used the financial crisis to completely reinvent their housing policy. And my god, are they reaping the fruit. But for the rest of us, once again, the financial crisis actually caused the housing crisis we have now. I definitely think we need to take away that housing first is the most effective policy and other countries should definitely look into adopting it. But again, most countries made very different choices. And now the housing crisis is a lot worse than it was in 2008.
Dominic: Ok, we've had two almost winners that you both wrote off because we can't emulate their success. You're a very strict teacher. And I feel sorry for both the city that you almost gave it to Vienna and the country Finland, where I think we've seen, frankly, in both cases, some quite inspirational policy choices.
Katz: Yeah, they have some great policies. And we can definitely apply some of what they did. But it feels a bit like shoulda woulda coulda. So I wanted to find a place that is actually making the right choices now.
Dominic: Ok, so is there a place where it both went wrong, and now currently is getting tangibly better?
Katz: Ok, there's a short answer, which I'll give you first. And then another answer that completely turns everything upside down, but I'll save it for later.
Dominic: Ok…
Katz: So, ‘Who Does It Best?’ Guess. A city where they are doing tangible and ambitious things with affordable housing.
Dominic: I really don't know. Somewhere in Scandinavia?
Katz: The answer is Paris.
Dominic: Oh, I did not expect you to say that!
Katz: Me neither. It's not my image of Paris at all. Paris is doing a lot. They are getting more and more strict on banning Airbnb to limit how much empty housing there is. But I would say the most significant thing they're doing is really investing serious money in social housing. They invested 528.8 million euros in 2024 alone.
Dominic: Wow, that's a lot of money. I mean, that's more money than Finland spent on Housing First, right?
Katz: It is, yeah.
Dominic: And what's Paris doing with all those hundreds of millions?
Katz: They're doing lots of things. So they're converting old government buildings and fancy areas into housing units. They're building extra floors on top of existing buildings.
Dominic: Inventive.
Katz: But maybe most interestingly, they are literally buying buildings back like one at a time from the private market. Because they realise that they just need a solid portion of the housing market back. And this way of doing it is not something anyone else is doing on that scale, because it's just super expensive. All of this together, Paris is putting its money where its mouth is.
Dominic: This is a podcast, but if you could see me, I'm doing an approving nod. Well done, Paris.
Katz: So after much deliberation, I would say on the ‘Who Does It Best?’ scale that Paris is the best.
Dominic: Woohoo!
Katz: Now, I've already given myself a reputation for the strict teacher...
Dominic: Oh my god, are you going to take back Paris's prize already?
Katz: Well, Dominic, we pitched this series to our crowdfunders as a chance to find the policy doing it best, right? And see if we could apply that policy to other places. And I don't want to rain on Paris's parade, I think they're doing an amazing job. I suspect if they carry on in a few decades, they too will be in a much better position. We should definitely be getting a lot stricter on Airbnb, investing serious money to buy back housing and social housing. But Marie-Jeanne, who studied the history of social housing, she made a good point.
Marie-Jeanne: On fait une petite chose ici, une petite chose là, un petit immeuble pour les migrants…
Katz: Current housing policy is tiny plasters on a gaping wound. A few homes here, a few homes there. But really big solutions, we don't really have them. It was sitting in that conversation with Marie-Jeanne that it hit me. We had such major innovation in the early 1900s. We invented plumbing, the existence of social housing. We invented electricity, and then we had to install it in every single home. We invented showers. And I just had to think, like, come on, surely we can do better than this. Surely. So, since people were so kind as to invest in our show, I thought, can I, with the help of our experts and some extra reporting, come up with a solution that is a bit more satisfying? So I've given out some trophies…
Katz: Right. Bronze for Vienna. Silver for Finland. Gold for Paris. But you keep saying we aren't having the right conversation. So you want to move on from the medals, I guess.
Katz: I do. Now that I have indulged you with the conversation that most people are having or expecting, I couldn't help but think, ok, what is the best use of our reporting resources? If this is about inequality, don't I need to dig into that root cause? So I did something scary. I dug into the economics of housing, and what I found flipped everything on its head. So tune in for part two.
Dominic: Oh, plot twist. There's a second part.
Katz: There is. See you next time.
Dominic: Did you get carried away, Katz?
Katz: Always.
Dominic: Rein it in!
Katz: It's too late.
Dominic: Well, you better tune in, listeners, or you'll never know how to solve this housing crisis. You are going to tell us how to solve it, right?
Katz: I absolutely will.
Dominic: Good. Keep listening.
Katz: This episode was written, reported and produced by me, Katz Laszlo. The series was edited by Jasmin Baoumy, and Katy Lee, with precious editorial support from my trusty cohost Dominic Kraemer, as well as Morgan Childs, Uršula Zaletelj and Maja Stepančič. Mixing and mastering came from the wonderful Wojciech Oleksiak. Sound design came from the fantastic Jesse Lou Lawson. Music and sound effects came from Epidemic, and Freesound.org, and our artwork and beautiful visuals came from the one and only Rosa Ter Kuile, otherwise known by her artist name RTiiiKA.
Huge thank you also to Vera Vrijmoeth, Georgia Walker, Cody Hochstenbach, Molly Broome, Marie-Jeanne Dumont, Juha Kahila, Ton Heijdra, Museum Het Schip, and the team at Woonbond. Shoutout also to my friend Paul who took me on that tour, and beyond that a really huge thank you to the many many friends and strangers who had conversations with me about money and housing and inheritance all across Europe, it was absolutely fascinating. Yeah! I hope that maybe some of you will feel inspired to do the same.
Most importantly, this series was a hundred percent funded by you, our listeners. Our generous crowd-funders made it possible for us to do extensive reporting, completely independently and we definitely do not take it for granted. We couldn’t be more grateful. If you’re feeling inspired to support our ongoing work, please feel free to go to patreon.com/europeanspodcast. You can donate as little as three euros, which is less than an overpriced cappuccino! But you can also donate so much more. Ok, bye!
Credits
Written, reported and produced by: Katz Laszlo
Editors: Jasmin Baoumy, Katy Lee
Editorial support: Dominic Kraemer, Morgan Childs, Uršula Zaletelj, Maja Stepančič
Additional reporting: Lara Lise Bullens
Sound design: Jesse Lou Lawson
Mastering: Wojciech Oleksiak
Music and SFX: Epidemic & FreeSound.Org, including pneumatic drill by acclivity
Artwork: RTiiiKA
Special thanks to: Vera Vrijmoeth, Georgia Walker, Cody Hochstenbach, Molly Broome, Juha Kahila, Ton Heijdra, Marie-Jeanne Dumont, Museum Het Schip, Woonbond, and the many more friends and strangers who talked to us about housing and money.
Interesting resources:
If you’re curious about where you stand on your country’s wealth ladder, you can find the World Bank’s wealth calculator here.
If you want to know your renters’ rights, many countries have renters’ unions that give (legal) advice. Here is the Dutch one: Woonbond.
Interested in hearing more radio that looks at how politics gets into our intimate lives? Journalist Anna Sale’s book and podcast “about the things we think about a lot and need to talk about more” have been a huge inspiration for this podcast.
Support Us
And most importantly, this series was fully funded by you - our listeners! Our generous crowdfunders hit our goal within two months, and made it possible for us to do extensive reporting fully independently. We couldn’t be more grateful. If you’re feeling inspired to support our ongoing work, please go to patreon.com/europeanspodcast. You can donate as little as 3 euros, less than an overpriced cappuccino! But you can also donate plenty more ;)
You can also help new listeners find the show by leaving us a review or giving us five stars on Spotify.