Social Housing in Europe

What is social housing?

There is no official common definition of social housing in the Czech Republic, except for VAT purposes. A high level of decentralization, together with the lack of a legal framework makes it very difficult to define the scope of social housing provision in the country. As a result, there are different views on whether the concept of social housing in Czech Republic should include the entire stock of municipally owned rental housing or only part of the stock aimed at people on lower incomes, which has been promoted by a series of subsequent programmes since 2003.

The sector of municipal flats still accounts for about 17% of the residential market. While in most Eastern European countries the political transition to democracy was accompanied by rapid privatisation of the public housing stock, in Czech Republic right-to-buy legislation was not passed and public housing privatization remained an open possibility for the municipalities themselves. However, the state decided to keep the original pre-1990 regulation of rents and tenure protection, and to allow only small and gradual rent increases. Rent regulation has been applied to all running tenancies regardless of tenure (both to tenants in municipal housing as well as to tenants in private rental sector), but not on new leases. Regulated rents are applied regardless of the social and economic status of tenants. Only some new municipal rental flats, subsidized by the state and let at non-profit rents, are socially targeted: beneficiaries of this type of housing assistance are households with defined incomes and persons disadvantaged due to health, social, and other reasons.

This system of new social housing construction has existed since 2003 and is still being developed. This represents only about 0.6% of the national housing stock. There are also a small number of units which serve as social service related housing provision (housing with social care, shelters, asylum housing, and temporary housing). Furthermore, in 2009 two new programmes were launched aimed at increasing the availability of social housing by opening funding to all types of developers willing to provide social rented flats with limited size and limited rents to people with lower income, but their implementation is lagging behind due to lack of funding.

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Who provides social housing?

Municipalities are currently the only providers of social rental housing. Since 2009, private providers are also eligible to develop new long-term social housing with the use of state subsidies, including developers, housing co-operatives, and non-profit organizations.

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How is social housing financed?

Essentially, most of the financing needed to cover capital investment costs for new municipal housing comes from the municipal budget. The State Fund for Housing Development is in charge of providing co-financing through investment grants within specific programmes. Although this portfolio includes programmes to support the construction of rental, social or cooperative apartments these programmes are currently not operational due to the lack of resources in the fund’s budget.

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Who can access social housing?

The allocation policy includes income ceilings depending on the municipality and priority target groups according to specific programmes- people with low incomes, seniors and persons threatened by social exclusion.