Helsinki will raise the rents on many of the subsidised apartments it provides to about 100,000 people across the capital, raising concerns among some tenants that they may have to relocate to less expensive areas. Based on the city's new rent balancing model, rents in some properties could rise by up to 10 percent next year.
The city aims to even out to 30 percent the difference between subsidised rents and the market rate. The model will apply across the city, which means that subsidised rents in some popular areas, especially in central Helsinki, will increase more than in others.
In addition to central Helsinki, subsidised rents will rise in Myllypuro, Haaga and Kumpula, among others. On the other hand, rents in Suutarila, Vuosaari and Kontula are likely to remain unchanged.
“We will not however lower the average rent anywhere,” says Jaana Närö from Helsingin Kaupungin Asunnot (Heka), which manages the city’s rental properties. “Instead, we will balance the rates at a slower rate. In some areas, rents will not rise for years,” she adds.
Moreover, location and architectural features of a property could affect rental rates. For example, rents in an Art Nouveau building or a house close to the seashore may go up, Närö says.
Tenants anxious about price hikes
The city has one rental property in Lauttasaari and the residents there are concerned about possible rent increases. “There are a lot of retired people and families living here. If the rents go up by 10 percent, many will consider moving away,” says Raisa Olenius from the Köysikuja 8 housing company.
She argues that the rent-balancing model treats people unfairly because rents in certain neighbourhoods will increase more than in others. “This is in no way a fair system,” Olenius says. The city’s new model will also increase disparities among districts, Olenius fears. “Due to this model, deprivation and social problems are likely to concentrate even more in particular areas,” she adds.
Närö contends that Heka’s model will not cause inequality among tenants. “In our opinion it’s correct that the rent benefit is the same for all tenants across Helsinki,” she says.
However she admits that in some areas subsidised rents could rise so much that not all low-income workers will be able to afford them. “Nevertheless, we will always have areas with lower rents on offer.”
Eliisa Saarinen, who lives in Köysikuja 8 with her family of two adults, five children and two dogs, currently pays 1,400 euros in rent each month. She says she is horrified by the thought that the rent could be hiked to 1,540 euros.
“I don’t know what we would do,” she says.
“Looking at the rental prices in Helsinki and the capital region it is clear that our family would have to move quite far away to find an apartment at this price,” Saarinen adds.