1. Access to housing for vulnerable groups is a challenge facing all Council
of Europe member States. Consequently, in November 2004, the Council of
Europe set up a group of specialists on housing policies for social cohesion
(CS-HO) whose aim was to recommend appropriate measures in some critical
areas of housing policies, in order to enable vulnerable groups to access
and to live in adequate housing.
2. The purpose of the CS-HO work was to
formulate concrete measures and policies within the areas of supply of
housing, financing and housing allowances in order to enable vulnerable
groups to have access to housing and enjoy the security of tenure.
3. Marginalisation and exclusion of groups
due to e.g. poverty, racism and xenophobia are obstacles to social cohesion.
Consequently the CS-HO group was instructed to recommend housing policy
measures which may contribute to social cohesion.
4. The significance of the right to housing
has been recognized in a number of international documents., such as the
Universal Declaration of Human Rights (Article 25.1), the Council of Europe’s
European Social Charter of 1961 (ETS No. 35) (Article 16), its additional
Protocol of 1988 (ETS No 128) (Article 4) and the Revised European Social
Charter of 1996 (ETS No. 163) (Article 31), and International Covenant of
Economic, Social and Cultural rights (Article 11).
5. The present policy guidelines are based
on the findings from the research work (which are presented in a separate
report, "Housing policy and the vulnerable social groups") and the
discussions and proposals of the CS-HO.
6. In May 2002, the European Committee for
Social Cohesion adopted recommendations on the ways to improve the access to
housing for vulnerable groups (Report on “Access to Social Rights in
Europe”, prepared by Mary Daly). They emerged from the work of the Group of
Specialists on Access to Housing (CS-LO) of the Council of Europe and other
projects.
7. The recommendations of the CS-HO group
build on and complement the recommendations developed by CS - LO.
8. The concept of vulnerable groups
denotes the risk of marginalisation from the socio-economic mainstreams (such
as labour market, housing market and basic public services). Vulnerability
is connected to regional or economic factors, as well as to individual or
social characteristics. Vulnerable groups are typically categorized in
social terms according to age, sex, ethnicity, disability or family status,
and geographic origin. There is a complex interplay of individual and
societal factors, such as discrimination and access to public services.
Definition of vulnerable groups varies from country to country, as the
existence of vulnerable groups are context dependent - partly influenced by
the legal and historical background, partly by the actual social and housing
policies.
9. The housing policies aimed at vulnerable
groups should target those persons who cannot reasonably be expected to
access adequate accommodation on the private market without support.
10. Vulnerability in the housing
sector means that there are groups, persons and households who are
in inadequate housing situation or are at high risk to lack any element of
the adequate housing.
11. Adequate housing is
defined by the UN Habitat Agenda (§ 60): “Adequate shelter means more than a
roof over one's head. It also means adequate privacy; adequate space;
physical accessibility; adequate security; security of tenure; structural
stability and durability; adequate lighting, heating and ventilation;
adequate basic infrastructure, such as water-supply, sanitation and
waste-management facilities; suitable environmental quality and
health-related factors; and adequate and accessible location with regard to
work and basic facilities: all of which should be available at an affordable
cost”.
12. Along these lines the
International Covenant on Economic, Social and Cultural Rights, (Article 11,
comment 4, item 8) developed a more elaborate definition of the concept of adequate
housing, referring to dimensions such as legal security of tenure,
affordability, habitability, location and accessibility, which are used for
the purpose of these guidelines.
13. Social cohesion is the
capacity of a society to ensure the welfare of all its members, minimizing
disparities and avoiding polarisation. Social cohesion is not only a matter
of combating social exclusion and poverty. It is also about creating
solidarity in society so that exclusion will be minimized. At the same time,
in so far as poverty and exclusion continue to exist, there is also a need
to take specific measures to help vulnerable members of society .
(Ref.
"Revised Strategy for Social Cohesion (2004) Council of Europe").
14. General housing policies
should be clearly defined and should include special policies for
vulnerable groups. These policies should be integrated with the national
economic and social policies.
15. It is necessary to reappraise and upgrade
the role of the housing sector within the national development policy, with
special attention given to the reviewing of the existing measures helping the
vulnerable groups.
16. Effective governance of housing policies
is crucial for the implementation of any measures for vulnerable groups. The
role of national, regional and local authorities in housing policies should
be clearly and legally defined. The institutional and administrative
system of local governance should be transparent, efficient, effective,
defining the role of civil society/NGO’s. The system should allow
participation of stakeholders. The programmes should be designed in order to
foster partnerships at local, regional and national levels, as appropriate,
in their policies aimed at addressing the housing problems. 17. Government and/or local authorities have
the responsibility to ensure sufficient supply of housing for all. General
lack of housing aggravates the situation for vulnerable households.
18. An appropriate legal, financial
and institutional base is an essential precondition for addressing the
problems also of the vulnerable groups. The state should be actively involved
in legal regulation of any housing relationships by its compulsory
provisions. Governments have to make efforts to develop a functioning housing
finance system and establish the legal and regulatory environment as well as
achieve macroeconomic stability and to promote sustainable economic growth.
The intervention of the state should complement rather than replace a
market-based finance systems.
19. The relevant authorities should undertake
a regular review of their housing legislation, policies and practices and
remove all provisions or administrative practices that result in direct or
indirect exclusion of vulnerable groups.
20. The legal environment (rent regulation,
tenancy rights, etc.) should provide balanced security both for the tenants
and the landlords. In order to prevent evictions the states should provide
adequate security of tenure for tenants, either in public or private
accommodation. Tenants should be provided adequate protection against
premature termination of tenancy and arbitrary increases in rent. In the
transition countries special measures are necessary to protect the security
of tenure for tenants who live in dwellings previously publicly owned and
governed (sitting tenants).
21. Legal regulation of land and housing
development should be in place in order to ensure sufficient provision of
residential land and infrastructure investment. A legal system is needed,
which includes and specifies property, land and secure tenure rights,
procedures for legal eviction and legal protection from unlawful evictions.
22. Housing
policies should be evidence based, and therefore the knowledge base should be
improved through research and regular data collection. Adequate knowledge of
housing situation; especially statistical information is a prerequisite for
effective housing policy design and implementation. Regular collection of
relevant statistical information on housing issues, including housing needs
assessment should be carried out.
23. There is a range of potential
instruments to improve housing for vulnerable groups, which for the purpose
of these guidelines will be considered as:
(1) instruments aimed at increasing the
supply of decent and affordable rental housing;
(2) instruments facilitating access to
housing finance for vulnerable groups;
(3) making effective use of housing
allowances. For different vulnerable groups in a given
national context a specific combination of these measures may be appropriate.
Guidelines on increasing the supply of
decent and affordable rental housing
24. In designing programmes for the
vulnerable groups, governments have to consider different measures used for
providing or increasing the supply of rental housing. The programmes have to
pass the viability test for measuring the real need for new housing
units on the local housing market, where the needs for appropriate
housing cannot be met by the existing stock in the prevailing circumstances.
25. Abundant supply of rental housing is an
effective way of improving access to housing for vulnerable groups, who
often cannot afford the cost and risks of ownership.
26. Countries with low level of rental
sector (below 20 %) should consider ways to increase the supply of housing
in the rental sector, especially in urban areas. In such cases, social
housing should play an important role. Adequate legal, financial and tax
conditions should be created, in order to encourage supply social rental
housing.
27. In order to increase the supply of
adequate and affordable rental accommodation, the private and non-profit
sector should be supported by necessary legal and financial measures.
Governments should provide adequate organisational framework and provisions
in the national legislation, policies and strategies, designed to increase
the supply of rental housing. Provisions should also be made for different
means, forms and methods of access to housing, such as social housing,
cooperatives, public housing, and innovative forms and tenures of housing.
All the relevant elements of the housing models mentioned (financial, social
and other) should be clearly defined.
28. The area- and community-based programmes
should be given more emphasis. Area-based grant programmes (e.g. cash
subsidy, tax exemption, etc) can efficiently contribute to the
rehabilitation of a distressed area and the creation of a mixed
neighbourhood.
29. Policy makers should look into
possibility to mobilise presently vacant housing for public purposes. They
should consider the effect of mobilisation on social cohesion in the area,
which in some cases will be enhanced. Mobilisation could be useful both in
the case of rental and owned housing.
30. In cases where supply of new housing
units is necessary, a number of different public policies may be used.
Typically, specific programmes use a combination of different financial
measures and define their institutional framework.
31. The housing strategy using a single or
any combination of measures should be accompanied with some targeting
mechanism. Targeting aims at vulnerable groups or at distressed
areas defined by special indicators.
32. In cases where financial incentives (tax
incentive, capital grants, etc.) are used, responsibilities should be
carefully allocated among the stakeholders (capital owners, developers,
housing company managers and public sector authorities).
33. The provision of a capital grant
is an effective instrument for increasing the supply of housing for
vulnerable groups, on the condition it is restricted to bodies that carry
out a clearly defined public service obligation. The capital grant has
powerful incentives and its costs are predictable. It should be used in
combination with other measures, such as housing allowances, and under
specific institutional framework, which guarantees the achievement of the
programme objectives. Capital grant is the most effective instrument in
cases, where there are severe housing supply and social problems, in order
to ensure access to housing for vulnerable groups.
34. Tax advantages for housing
providers are very commonly used financial incentives for increasing the
supply of housing. The form of tax advantages varies widely, including
partial or total exemption from the profit tax, an accelerated depreciation
of rental properties, and partial reduction of the VAT. The programmes
should provide stable, predictable and long-term advantages for the landlord
providing social housing. It may be a measure to increase supply of housing
in general, however, it is not necessarily targeted on vulnerable groups. Of
all tax advantages, VAT reduction may be the best suited for targeting
vulnerable groups.
35. Interest rate subsidy
programmes used to have a crucial importance in a high-inflation environment.
It could cause undesirable market distortion, if it is used as a general
supply instrument. Therefore, it should be well targeted on vulnerable
groups. It might have an important role in the transition countries, in
cases where inflation is relatively high.
36. Mortgage guaranties for
institutions, which supply social housing, have proved to be an efficient
instrument for supporting the supply of affordable housing in a
well-designed institutional environment.
Housing finance instruments for vulnerable
groups, aimed to facilitate housing ownership
37. Considering risks and costs associated
with home ownership, policies facilitating access to rental housing may
often be preferred to policies, which provide access to finance for private
housing ownership. However, in countries and regions where the rental and
mortgage market are not well established, or in rural areas, policies
providing access to housing finance for home ownership might be a possible
solution for facilitating access to housing for vulnerable groups.
38. The government should choose among the
demand side instruments which fit into the country’s legal and financial
framework and which are tailored to the specific needs of the vulnerable
groups. Targeting is also necessary to control fiscal effects.
39. Beyond the provision of an efficient
legal and institutional framework, there is a number of specific instruments,
which can be used to promote access to housing of vulnerable groups in the
owner-occupied sector.
40. Guarantees provided by
government agencies or by private guarantee institutions have proved to be
an efficient instrument for helping low-cost homeownership programmes in a
developed legal and financial environment. With such guarantee schemes,
vulnerable groups have better access to credit, since the guarantees reduce
risks of loans given to low-income groups, and thus ease credit-rationing.
41. Housing allowance for home-buyers
helps the low-income households to pay their expenditures related to the new
unit. This is a means-tested support to vulnerable groups in the
owner-occupied sector. The housing allowances are discussed in detail in the
next section.
42. Capital grant is
considered to be a very efficient instrument to enhance the access to
housing of low-income groups in an immature housing finance environment. The
advantages of this instrument are its transparency and predictability of its
total cost. For well-defined target groups (e.g. first-time buyers) it could
be a very efficient contribution even in a developed housing finance system.
43. Interest rate subsidies
were very popular methods to increase the purchasing capacity of the
beneficiaries, but these instruments became less important in the
low-inflation environment. Typically these are not means-tested programmes,
which means that they are not targeted unless specific eligibility criteria
are used (e.g. families with members with disabilities, first-time buyers,
immigrants, etc.). If targeted on vulnerable groups, this may be a useful
instrument for facilitation of their access to housing.
44. Tax exemption has been a
popular housing subsidy given to the home-buyer. This instrument is not
suitable for helping low-income vulnerable groups, because of its regression
attribute (the higher income groups benefit more from the subsidy). Persons
who do not pay taxes do not benefit from this instrument.
45. Contract saving systems
are voluntary saving products which offer some financial incentives for the
savers in the form of premium, preferential loans, or tax advantages. This
instrument is less appropriate in the high-inflation environment and for the
low-income households. Such policy instrument is not recommended for helping
vulnerable groups to gain access to housing, considering limited
possibilities for people on low incomes to benefit from it and the risk of
high expense for the public budget.
46. For the social groups with low access to
the conventional credit instruments it might be advisable to consider the
use of the microfinance schemes, which make possible access to
loans of small amounts to be used for refurbishing of housing or self-help
housing schemes.
47. Shared ownership, where a
partial owner gradually can become a full owner, could decrease the
financial burden of the targeted group combining the advantages of the
owner-occupation and the rental scheme. This scheme can be combined with
other instruments, e.g. interest-free loans. However, shared ownership
schemes require special legal background and a well-developed practice.
Guidelines on effective use of housing
allowances
48. The goals for a housing allowance system
should be to improve the access to decent, affordable housing for all
households on low incomes and to function as a safety net for these
households against increases in housing expenditure or decreases in income.
49. Housing allowances is a means-tested
demand side support to low-income households, which enables them to consume
more housing than without the subsidy. Most countries in Europe have some
type of housing allowances. This instrument has to a large extent
supplemented or replaced supply side subsidies. Housing allowances are often
considered to be more cost efficient than supply side subsidies, because
they can be easily and better targeted and are more flexible, automatically
adjusting to changes in household income, housing expenditure, etc.
50. When there is a shortage in the supply
of adequate housing for low income households, a combination of housing
allowances and supply side subsidies should be considered. The housing
allowances themselves will have a minor or no effect on the housing supply.
51. In order for an efficient housing
allowance system to work, the following prerequisites, concerning the data,
have to be in place or developed:
- reliable data on household income level
should be available as a basis for the means test.
- data on household expenditure on housing
should be available. Such data is used for determining the necessary
expenditure for reasonable housing consumption for households in different
situations.
- reliable data on household composition
should be available, as a basis for assessing the need for allowances for
households, according to household income, size and other indicators of need.
- data should be updated continuously.
- if these data are not available, proxies
or indicators can be used in the design of housing allowances.
52. A system for housing allowances should
include the following elements:
- acceptable income levels after payment of
housing expenditure should be defined for different types of households,
tenures, locations etc. These income levels will indicate the need for
housing allowances for different reasonable housing expenditures. In this
way the allowances will decrease the need for support through social welfare
payments.
- the amounts of allowance should be based
on the needs of vulnerable households.
- a system where benefits are an increasing
function of housing expenditure and a decreasing in income. The system
should minimize poverty traps and other negative effects.
- definition of maximum eligible housing
expenditures for different types of households for the calculation of the
allowances.
53. All tenures and types of households
should be eligible, in order to avoid segregation and distortions in the
housing market.
54. There should be neutrality in tenures, unless the government has a
reason to favour a specific tenure, e.g. to enhance social cohesion by
having larger housing allowances in tenures with relatively few low-income
households.
55. The housing allowance system should be
coordinated with social policy and transfer systems.
56. The system should be transparent both to
consumers and administrative bodies. The design of the system should avoid
unnecessary complexity.
57. Allowances should be large enough to
affect behaviour of the targeted households and should be controlled
effectively.
58. Risk for “leakages” should be minimized.
For example, in a situation with shortage of housing for low income
households, housing allowances may result in higher rents, which means that
mainly the landlords will profit from the allowances.
59. The allowances system should not encourage over consumption, i.e. should
not cover 100% of the housing expenditure.
60. Housing policies for vulnerable groups
should be designed and implemented taking into account general housing
policies, and policies in related sectors, such as education, health,
employment, transport, urban planning and social protection. For example,
social rental housing should be well connected to areas with employment and
training opportunities, in order to facilitate the integration of
households on low incomes to the labour market. It is important to
coordinate efforts of the relevant authorities, to find and exploit
synergies between different sectors, and to encourage the public
authorities at all levels to adopt comprehensive approaches and policies.
61. A legal framework supporting the system of housing policy should be set
up or revised in order to give transparent contractual agreements between
the different actors, legal provisions regarding security of tenure and
security of ownership, a legal framework for financial laws, land and
mortgage laws, bank regulations, administrative and procedural laws
including laws on forced evictions, rental laws, laws on various forms of
planning, partnerships, and housing types (as condominiums and
cooperatives).
62. Integrated housing measures have to be developed for specific
vulnerable groups. The definition and social composition of vulnerable
groups differs from country to country, thus it is important that the
governments develop specific programmes addressing the housing problems of
these groups.
63. The housing measures of these programmes should use a combination of
the methods developed under the previous headings and should include the
building or development of the entire physical and social infrastructure
that is needed for adequate and sustainable housing.
64. Beside the central level, regional and local authorities should also
develop housing policies, strategies and action plans, coping with special
local housing problems and taking into consideration the possible roles of
the private sector and non-governmental agencies.
65. An efficient and transparent institutional structure, including
administrative procedures on all levels and defining the role of all actors
of the housing policies should be developed.
66. Non-governmental organisations, especially those working with or
representing the interests of vulnerable groups, should be involved in the
process of conceiving, designing, implementing and monitoring policies and
programmes aimed at improving their housing situation.
67. The objective of housing policy should
be to ensure access to affordable housing with an adequate standard and to
ensure the security of housing for all, and to enhance social cohesion. The
design of new and the evaluation of the existing housing policies should be
also done from the perspective of social cohesion. The importance of social
cohesion should be acknowledged among all stakeholders.
68. There has not been much focus on social cohesion in the discussion and
implementation of housing policies in the past. There are some housing
policies that might even be damaging to social cohesion or involve conflicts.
Some housing policies may lead to polarisation or stigmatisation of certain
groups.
69. Strategies for promotion of social cohesion should include housing
policy, which should give special consideration to vulnerable groups.
70. Besides housing market factors, the extent and the nature of the housing
problems depends also on the efficiency of the existing welfare system. With
poorly functioning welfare system and inefficient safety net, less people
will be able to afford adequate housing, thus the housing policy will have
more tasks to solve. On the other hand, an efficient welfare system might
partially reduce the tasks of housing policies. Housing policy is connected
to other public policies (such as employment policies or urban development
policies), and its potential contribution to social cohesion depends partly
on how much is solved by those other policies.
71. In order to promote social cohesion, all housing policies should give
special attention to vulnerable groups:
- Housing policy instruments should provide for measures ensuring effective
access to housing policy benefits by vulnerable groups.
- The public policies should be designed in a way which increases the supply
of housing for vulnerable groups and facilitates the creation of socially
mixed neighbourhoods.
- Housing policies should include provision of information and counselling
to vulnerable groups, in order to draw the most of benefits from the
available programmes. Housing assistance programmes may fail because
low-income households, who are target beneficiaries, may either lack
information of wider options.
- Segregation of people with special needs should be avoided and they should
be provided with appropriate social services in order to facilitate their
participation in the community.
72. Housing policies aimed at the special needs of vulnerable groups have to
contribute to the formation of healthy/inclusive neighbourhoods that provide
access to the basic services for all groups of society.
73. Area-based targeting may be necessary, in order to increase the quality
of life of people living in these areas, limit the segregation processes,
and to allow for a mixed neighbourhood. Creation of mixed neighbourhoods is
desirable as long as it does not lead to exclusion of persons on low incomes.
74. Measures to counteract discrimination on an individual basis when
planning and managing housing estates, neighbourhoods and areas should be
implemented and monitored.
75. Whenever housing policies in general and housing measures for vulnerable
groups in particular are designed, a prior assessment/evaluation of the
consequences for social cohesion should be made.
76. Monitoring and evaluation of housing policies for vulnerable groups,
should include an assessment of effects on social cohesion. For this purpose
appropriate indicators should be developed, statistical information should
be collected on a regular basis, and research on this issue should be
carried out.