YLE: Helsinki wants millions more in land rent

YLE: Helsinki wants millions more in land rent

According to YLE, rents on some plots in Kumpula have risen by as much as 500 percent.

Mitri Kitti, the vice – president of a local detached house association, revealed to the broadcaster that many people living on rented land have had to take action to cope with up to four – digit increases in housing costs. Such residents were too embarrassed to talk publicly about their situation and the measures they had to cope with.

For example, many have divided their houses into several apartments for rent for short or long periods to subtenants.

The same policy change is planned for other parts of Helsinki. More than a week ago, the Helsinki City Council decided that the land rent for both new and old detached houses and apartment buildings would be gradually raised to match market prices in other parts of the city at the end of the leases. The decision was described as a way to lower house prices, as undermarket prices could raise house prices.

Sami HaapanenThe City of Helsinki’s property manager confirmed that the increases are also a way to raise funding for urban development. Land rents, he said, are a significant source of revenue for the city, generating an annual income of a few hundred million euros.

“Land rental income is used for the benefit of all citizens. Land rent lower than the market rent raises housing prices and thus only benefits the builder of the apartment or the current owner of the house, he told YLE.

Residents affected by rent increases have accused the city of operating as a real estate fund. Kitti called for a debate on whether property and property management should be part of the city’s core functions.

The increases have also been labeled as unfair because they did not coincide with the increases in property tax, ie those living on their own land have been spared such increases in housing costs. Helsinki has also not offered tenants the opportunity to buy plots of land, Kitti emphasized.

“This can lead to people having to move out. You can adapt to hikes. But if you can’t adapt, you have no choice but to move elsewhere,” he said.

Aleksi Teivainen – HT

Source: The Nordic Page




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