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A new report is sharing knowledge for the fair housing recovery of Ukraine

Read "Rebuilding a place to call home"

the Netherlands, 10 May 2023 | Published in Social, Future of the EU & Housing

"The destruction and devastation since the full-scale invasion in 2022 have been immense. Almost six million people are internally displaced within Ukraine, while another eight million have fled to neighbouring countries. War-induced impoverishment has led to over 40% of households having exhausted their savings and close to 40% of internally displaced people (IDP) needing assistance with paying the rent. As of early 2023, housing is the most impacted sector of all, with over 817,000 homes damaged affecting two million residents and at an estimated cost of USD 40 billion," the newly published report says.

The minds behind this so-much-needed work are Oleksandr Anisimov, Pavlo Fedoriv, Oleksandra Tkachenko, Julie Lawson, the lead author of our joint #Housing2030 report, and Edwin Buitelaar. The report has been published by PBL Netherlands Environmental Assessment Agency. The Housing Europe Observatory and our members from Denmark, Austria, and Finland have also contributed with their knowledge and experience on how the rebuilding of Ukraine can be just, inclusive and remain decent in the long term.

While the war has affected society and torn entire neighbourhoods down, the report stresses that "many housing problems that Ukraine is facing today are systemic and have been present since long before the full-scale war." However, so have the solutions and solid housing systems in some corners of Europe, where homes are built for the people and considered affordable, liveable, and safe.

On the basis of the symposium ‘Ukrainian housing recovery forum’ in the Hague, in February 2023, this report draws and develops the lessons and challenges stressed by Housing Europe's Secretary-General, Sorcha Edwards, the EIB, Vienna city, the Housing Finance and Development Centre of Finland (ARA), and other committed organisations.

Housing Europe's team and network remain open and supportive, ready to offer knowledge, experience sharing, and data so that the realisation of the six major recommendations below can restore Ukraine.

The experts behind this work have the ambition not only to support the rebuilding of cities, and towns but to offer a piece of advice that can provide again the safe feeling that only a warm, affordable, well-located home could.

  • Better access to affordable housing is crucial for households affected by the war

Because of the poorly regulated private rental market, millions are facing an unsafe and insecure housing situation. The social housing stock in 2021 accounted for just over 1,000 units countrywide. The absence of public and semi-public housing providers, such as municipal housing organisations, cooperatives and associations further complicates the situation.

A range of housing options beyond individual homeownership could help ensure safe, secure, and affordable housing for all Ukrainians. The not-for-profit rental housing such as in many European countries offers a proven model for Ukraine to build on. Housing associations, cooperatives, and municipal organisations have shown to reliably provide energy-efficient and high-quality rental housing alternatives. Such a model requires a strategic long-term investment framework and good regulation. This report demonstrates how well these systems work in other countries, such as in Austria and Denmark.

  • The Ukrainian housing system requires a national vision followed by a coherent legal framework that responds to current societal needs

A National Housing Strategy would provide a clearer governance framework for the activities of the national government, regions (oblast) and municipalities (hromada) as well as the European Union and other international actors in the realm of housing. New legislation for non-profit (municipal and cooperative) and private housing could include regulation and accountability for housing providers. Conditional investment and supervision can ensure that rents and fees cover efficient operating costs and that any revenue surpluses are used for expanding affordable housing.

  • Public subsidies for socially just and economically efficient housing

Over the course of 30 years - the organisation responsible for the implementation of housing programmes -  has provided housing subsidies to over 40,000 households with little control over quality and sustainability. At the same time, most of the government financing never reached the vulnerable groups, even as the need for housing was growing.

To analyse countywide needs and coordinate government funding, a dedicated national housing agency and national housing fund with the appropriate resources seem pivotal. Finland’s ARA provides a leading role model for such an agency that works closely with municipal governments. Through investments, steering and monitoring, ARA ensures that subsidised housing is of high quality, sustainable and affordable. Next to direct provision of public housing, ARA uses tools that stimulate the provision of private affordable housing, such as competitive conditional public grants, long-term loans, interest subsidies and guarantees. Such a model ensures that initial investments remain in the housing system in perpetuity.

  • A new approach towards managing multi-apartment buildings

Currently, there is a considerable backlog in maintenance and energy-efficiency modernisation. Furthermore, only about 20% of such buildings have established homeowners associations. 

There is a need to supply multi-apartment buildings with management structures and a clear understanding of ownership rights and obligations. New management and financial models have to be developed for sustainable management of the housing stock to improve housing conditions while securing the right to adequate housing for both low- and middle-income households. The renovation wave has the potential of practical implementation of the EU’s Energy Efficiency Directive and Energy Performance of Buildings Directive.

A focus on the reconstruction of the Soviet-era micro-districts will allow them to adhere to the Green New Deal and CO2-reduction targets, both during reconstruction and over the buildings’ lifetime. As it is in the soft renewal programme in Vienna, such a policy can increase the attractiveness of the cities for the Ukrainians who are looking to return from other countries. This will also boost the quality of life in the existing neighbourhoods and prevent continuing urban sprawl.

  • More local expertise and capacity are necessary

According to current legislation, social housing provision is a municipal responsibility, but few resources are dedicated to fulfilling this role on national or local levels. Ukrainian municipalities’ have limited human resources and fiscal capacity. They also lack clear government authority and guidance regarding the aims and tasks of housing provision, such as integrated planning for housing and sustainable social housing operation models. Civil initiatives have proven indispensable in the emergency response, but their role in housing recovery is underutilised and needs to be supported.

To increase municipal skills and planning regarding housing, a comprehensive capacity-building programme could be initiated. The local planning bodies in Ukraine could use active and facilitative land policy instruments to ensure affordable and integrated housing development. Local land banks could provide suitable land for subsequent housing projects, especially in combination with government or international investment. Forms of ‘inclusionary zoning’, as exist in the Netherlands and Austria, ensure that private developers include affordable housing alongside other types of real estate. Vienna’s Wohnfonds supports not-forprofit housing that is embedded in a vibrant context of other homes, green space, amenities, schools, accessible jobs and public transport via developer competitions and strategic land release. Such instruments effectively promote diverse and balanced neighbourhoods.

  • A national-to-local housing finance interface has to be introduced

Access to national and international finance on the level of municipalities is rather limited and restricted. Also, to date, no framework for non-profit operating models and revolving funds have been developed.

A national housing fund and national housing agency are both key to driving the local responsibilities for housing with conditional needs-based investment. To ensure a comprehensive redevelopment of the territories with new mobility and social infrastructure as well as affordable housing multi-level agreements can be implemented. In Finland, ‘MAL’ agreements (country–region–municipality) bring together commitments and knowledge from local councils and the fiscal capacity of the national government towards common goals.

International partners and donors can provide Ukraine with technical assistance to establish coherent housing legislation, a strong national agency together with a dedicated national fund, and to invest in municipal capacity-building in planning and shaping the development of affordable housing and liveable neighbourhoods.