– It is crucial, because you can not do anything in the housing market without there being money in it, he says.
The New Construction Fund’s money comes from the tenants themselves. The money will, among other things, remedy some of the problems that have made it difficult to build more public housing in Copenhagen.
Here, a constant influx of new residents and more money in the pockets of the city’s residents in recent decades has helped push up the prices of building plots.
And especially in times when the economy is booming from there, the ceiling on the cost of building public housing means that in some cases it ceases to make sense to build publicly.
According to Curt Liliegren, there are two obvious paths around that problem:
– The solution is then either to raise the budget amount, but then you make the rent more expensive, and you inflict more expenses on the municipality for share capital, he says.
– The second solution is to add money targeted to the increased basic expense. This is apparently the strategy that the government has adopted.
– It makes good sense if you want to build on the expensive grounds. It is, after all, a political stance.
In its proposal, the government proposes, among other things, to make a state scheme for land purchase loans. It will have DKK 1.9 billion over ten years from the New Construction Fund and DKK 700 million from the municipalities.
The government also wants to look at the order in which the different types of housing are built when new housing is built.
The parts of a residential building that are to be on the private market have in fact tended to come first in the queue.
This is because the economy of constructing new homes is most often brought home through the homes on the private market.
This means that you want to have them stacked on the market first, while you know the conditions in the housing market rather than wait and see what the wind blows in the housing market while you build the public housing.
Therefore, Curt Liliegreen points out that it can move a number of public housing from drawings to reality that demands are made on the order in which the different types of housing are built, as the government proposes.
– As I heard the Minister, he also mentioned the possibility of compensation. Because this is about economics, says Curt Liliegreen.
According to Curt Liliegren, if housing developers do not get something in return for the increased risk of building public housing earlier, there may be a risk of unwanted side effects:
– Then one can fear that some private developers are pulling the feelers. Then you get fewer people who are interested in buying land, and you do not want that. Because you would like to have built a lot of homes in Copenhagen, he says.
Source: The Nordic Page