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Students slam housing idea: ‘We’re not lab rats’

A suggestion that students forego kitchen access and space has angered students, who say politicians should not use them for housing experiments.

Published: 11 January 2013 15:22 CET

Students slam housing idea: 'We're not lab rats'

“If you want to simplify building rules, student housing is the first place to start,” Ulf Perbo, top aide (statssekreterare) to Sweden’s housing minister, is quoted as saying in a construction trade magazine.

He suggested students could do without a common room and a kitchen, and that sacrifices in living area were an option.

“It’s not a life threatening catastrophe,” Perbo told the magazine.

Erik Pedersen, vice chair of Sweden’s Student Unions (Sveriges förenade studentkårer), reacted angrily.

“This shows the attitude that students are second-class citizens,” he told Sveriges Radio (SR).

“We are not lab rats.”

Meanwhile, Housing Minister Stefan Attefall hurried to his aide’s defence.

“The quotes are exaggerated and not presented in context,” he said.

A record number of students were accepted to Stockholm universities at the beginning of the academic year, yet at the same time the student housing situation has never been so dire.

Estimates at the time said only 15 percent of students had ready access to accommodation provided by the university.

The National Board of Housing, Building and Planning (Boverket) is currently investigating if it is possible to simplify construction rules and regulations. It should present its report in the summer of 2013, reports SR.

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Why buying property in Austria remains unaffordable for most

Many people living in Austria dream of one day owning a home, but despite recent drops in property prices and interest rates, this dream is still out of reach for many average earners.

In Austria, it is recommended to not spend more than 40 percent of a monthly income on debt repayment.

But new analysis by tariff comparison portal durchblicker.at reveals that even a double-income household would need to spend around 60 percent of their income to afford a 90m² new-build apartment in Vienna.

While the government has created initiatives to improve the affordability, with attractive housing packages, fee reductions and eliminations of certain fees, such as the “Grundbucheintragsgebühr” (land register entry fee) and “Pfandrechtseintragungsgebühr” (mortgage registration fee) for properties up to a certain value, their impact has been limited.

Furthermore, the governments initiatives often overlook the specific needs of lower-income households and may benefit those who are already financially stable, leaving the average earner still struggling to afford a home, according to Der Standard.

READ ALSO: ‘Haushaltsversicherung’ – How does Austria’s home insurance work?

High prices, rates and strict lending criteria

One of the biggest barriers to owning a home in Austria is simply the sky-high property prices. Over the years, property prices have increased, making it more difficult for people with an average income to afford a place of their own. Even with recent minor dips in prices, they still remain high.

Another factor making owning a home challenging is the increase in interest rates in recent years. As a result, both existing variable-rate loans and newly obtained fixed-rate loans have become more expensive. Analysts expect the European Central Bank to cut interest rates by around 0.5 percent in the near future, but according to durchblicker’s calculations, this would initially only create a little relief for loan takers, where instead of around 60 percent, 55 percent of monthly household net income would be needed for debt repayment.

Another issue preventing many from realising their dream to buy a home is the difficulty in obtaining a mortgage. Since July 2022, stricter rules have applied in Austria for the granting of property loans. Loan applicants must have a deposit worth at least 20 percent of the value of their property to be granted a loan, according to the financial online platform Finanz.at. This means that even applicants with higher incomes may struggle to get their dream financed.

Furthermore, many loan takers with variable-rate loans, especially those recently obtained, are facing significant challenges. The variable interest rates have increased significantly since the initiation of these loans, resulting in higher monthly repayments, reported Der Standard.

Few people can afford their own home in Austria, especially in Vienna. Photo by Christian Lendl on Unsplash

Experts suggests fixed rate loans and cooperative housing models

Andreas Ederer, Head of Banking at durchblicker.at, recommends loan takers with variable-rate loans to change to fixed-rate loans. He suggests that fixed-rate loans have become more attractive as they are currently cheaper than variable-rate loans, reported Kurier.

Unlike fixed-rate loans, which have a steady interest rate throughout the loan term, variable-rate loans can change over time in response to shifts in market conditions or the economy.

Experts also suggest alternative models for increasing affordability. One idea is to create more opportunities for cooperative ownership with mandatory purchase options. This could offer a more affordable option where costs such as maintenance and taxes are shared. According to Der Standard, cooperatives also often have access to loans with better terms.

READ NEXT: How can I move into affordable cooperative housing in Vienna?

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