New Policies to Facilitate Affordable Housing in Central and Eastern Europe

Abstract

Affordable housing construction is a lagging sector in most of the CEE countries. Recent increases in housing production have mainly served the top end of the market. In some countries, policy schemes for public housing have been established. However, actual construction of housing for moderate-income households has yet to take place. Wolfgang Amann describes the approach of the Austria-based IIBW – Institute for Real Estate, Construction and Housing aimed at rectifying this unsatisfactory situation. The framework for a Public-Private Partnership (PPP) model in housing will be established, with two parallel strategies. First, a legal framework will be established to allow for a new business model of PPP housing. Second, financing tools will be implemented, similar to structured financing, implementing the different layers of sources. This approach refers to lessons learned in many Western European countries, e.g., the Netherlands and Austria, where a Third Sector in housing contributes substantially to good housing provision for large parts of the population. IIBW is currently implementing this new approach in several CEE countries, including Romania, Montenegro and Albania.