The article states that Vienna's population in 1914 (at the beginning of WW1) was 2 million, vs 1.9 million today. I'm no housing policy expert, but isn't it possible that Vienna's rents are stable and low in part because they haven't had to increase their housing stock in over 100 years? It seems to me that a new-world city like Vancouver that has grown tremendously over that period wouldn't be directly comparable.
> Vienna's population in 1914 (at the beginning of WW1) was 2 million, vs 1.9 million today.
You can't just take those two data points and assume that they are connected by a straight line. Vienna was down to about 1.5 million around 1990 and has been growing since. https://en.m.wikipedia.org/wiki/Vienna#Demographics
> Vienna's rents are stable and low
For the record, they are neither. There has been crazy, and accelerating, growth in rental costs over the last ten years.
Interestingly, SF's population has only grown 13% from 1950 to 2020. The housing prices have grown rather differently, though. Curious to see, isn't it?
Standards of living were vastly different back then. It used to be the norm that 6-7 people were living in the same room, and apartments were about 22m² [1]. Toilets were outside the apartment. etc. Since then, old houses were upgraded and massive amounts of new houses were built to accommodate a rising standard of living. Just in the past 30 years, formerly cheap regions at outer parts of Vienna, with houses that were only habitable during summer, developed into enormously expensive upper-middle class areas with single-family houses.
Yes, increasing population generally leads to increasing land prices, so I think that's a good question. There are other things that drive land values up, however, such as just generally increased productivity due to technology and any other factor (because a more productive population earns more and can thus afford to pay more in rent to their landlords).
For a full assessment I would like to see other Austrian cities that have had similarly stable population sizes but don't have Vienna's policies.
The countervailing trend is that the number of people per household has fallen greatly in the last 100 years, so even a city without a growing population needs construction to keep up.
I don't have the numbers handy, but household size has shrunk dramatically over the last 100 years. I would guess that today's 1.9M people represent 50-100% more househoulds than 1914's 2M.
D.C.'s population has gone down since the 1950s and it still faces affordable housing and homeless issues. I don't think population growth or decline is a clear driver.
> As both the Vienna model and Henry George[1] would suggest, the problem is forever and always the cost of land. Burdensome land costs, and the rentiers who gain massive wealth by passive land speculation, are the real enemies — not developers, not our homeowners, not our public officials.
EDIT: From the looks of it Vienna's policy isn't purely Georgist, but it has a few policies (namely land tax, particularly on vacant lots) out of Henry's playbook.
When homeowners have the vast majority of their wealth ties up in land values, and not structure values, they become property speculators and rentiers just as bad as any other wealthy rentier.
There is something called in Austria called "Freunderlwirtschaft". Its Austrian for "corruption but everybody is doing it so it is ok".
These "Gemeindebauten" (affordable cheap public housing) have good flats and good areas and bad flats and bad areas. So if you want to be in the really good ones, you better have the right "Parteibuch" (party affiliation) or a friend who has it.
Said that, Gemeindebauten are a great but flawed system.
I think a much better effect has the "Altbaumiete" (old pre world-war-II housing) which are rent controlled. Kinda great living, slightly windy and sometimes smelly and there may be lead in the pipes, but at least affordable.
So a hundred years ago the city imposed crazy taxes on land owners and then bought the land for themselves. Then the city built a lot of housing on the now city-owned land via non-profit construction.
The article doesn’t make a strong attempt to explain how their housing affordability is “solved” though. How easy it to find a new apartment to rent? How much does it cost? What do you get for that price? How does this compare to other cities in Europe? How does Vienna compare to other Austrian cities which did not buy up land?
It’s an interesting case study and I’d love to know more. But this article leaves a LOT of open questions.
When you rent you usually do it via a Makler (real estate agent), who is going to ask for 2 months of rent as his/her fee. This is not the deposit, which is usually 3 months, and not the first month rent, this money is gone forever. So people tend to rent on the longer term, 5-10 years easily, because you have to have about 6 months of rent in cash available just to start.
Which sucks if you find a job somewhere else, or just choose badly and it turns out the neighbours are loud, or the house is a sh*tty concrete building with paper walls built in the 50s...
If you are very lucky or have connections, you can rent privately, and then you don't have to pay the Makler. But the number of apartments available like this is very low, I'd say <10%.
I moved here from the UK, and while the UK (especially London) has its problems, I would choose that system _any time_ over what's here in Vienna.
To add insult to injury, the housing prices are sky-high, almost as bad as in London, while the salaries are much lower. So buying an apartment is not really an option unless you can sell another one, or get some support from family.
On the other hand, my wife lost her job, and for the first 5 months or so she gets more than 50% of her salary as Arbeitslosengeld. So that offsets the extremely high taxes a bit.
It's generally comparatively easy to find a flat here. Rents are low compared to most other cities of its size in central Europe, but rose by quite a lot in the last two decades. I pay about 650€ per month for a 1-bedroom-apartment in central Vienna, with good infrastructure
Hard to compare it to other Austrian cities, because those are generally much smaller (but can be more expensive than Vienna(.
Objectively, Vienna's housing price index is up 75% in real terms since 1990. While that's not the ideal 0%, it is much better than San Francisco where prices have gone up by 400% since 1990.
More like, city imposes a variety of luxury taxes dedicated to fill the gap left by private businesses in providing homes. While the public building program never made up a major share of the total, it still provided housing to the poor and working class and also provided a base line for the market.
I think Singapore also has some particular relevance to the US because of its multi-ethnic nature.
Often when I talk to Americans about public housing a really common argument is the image of public housing as a sort of racist thing that creates enclaves for certain (usually low-income) groups. Yet Singapore, with its integration policies has virtually completely avoided this, and it basically can only do it effectively because it controls the housing stock.
It's not a utopia but the degree to which people intermingle and live together is quite astonishing if you're used to French Banlieues or the segregation in many American cities today.
Knowing Vienna quite well and knowing Vancouver at least a little bit, I'd say this is not apples-to-apples. In Vancouver it was the real estate boom that has fueled high-quality residential development: Given the circumstance where such development would fetch high prices, residential development was conducted that would deliver on a level of quality commensurate with high prices (namely: high quality!). A "Gemeindebau" in Vienna is a very different animal: They are built cheaply for the purpose of being cheap, and the quality you get ouf of that is in line with the principle "you get what you pay for" (namely: low quality!)
This isn't necessarily true, especially for the original building program. Pre-war apartment buildings for the masses (Zinshaus) were raised quickly and weren't maintained well. E.g., before regulations outlawed the cheaper variety in the 1990s, cheap apartments often lacked a bathroom of their own and relied on shared facilities. The public building program, on the other hand, was up to modern standards (and taking pride in doing so), while it was still aimed at efficiency and never intended to rival the residential buildings raised by private ownership for the middle class. So, if you expect high rooms, stucco, etc, you're probably in the wrong market. (Also, you may not be part of the intended audience, anyway.)
A sorta aside. The absolute best AirBnB experience we ever had was in Vienna. Of course it's an anecdote, but we had absolutely no trouble finding convenient, cheap, and large places to stay under $70/night. This made us think that the housing market there must be quite cheap compared to where we're from. We ended up staying in an absolutely beautiful flat about 20 minutes from the city center via U-Bahn for <$60/night -- a price we've paid for old bedrooms in lesser cities. The same flat where we live would easily cost closer to $3k/mo.
>"Vienna provides an interesting counterpoint. Because rent control disincentivized the private development of rental buildings, landlords were, for a time, removed from the market for urban land. Consequently prices finally went down, allowing the city to buy land at a much reduced price; often it was the only buyer in the market."
PDS: An interesting cycle (or set of cycles) of cause and effect...
Disclaimer: I am neither for nor against rent control...
Here's the gist: the government taxed the shit out of the landlords and forced them to sell their land cheaply. Europeans generally see nothing wrong with this strategy, whereas most Americans will feel shivers down their spines.
This difference comes from different attitudes around ownership. In places like China and Russia, owning a house means you get to keep the house unless enough people would benefit from you not owning it. In the US, you get to keep your house no matter how much anyone - including the government - would prefer you didn't.
Europe is somewhere in between on that spectrum, and this attitude extends to not just land ownership. For example, a popular ad campaign in Austria is demanding from the employees of BioNTech to leak the base components and production instructions so that other companies can steal those trade secrets and supposedly help generate more vaccines. If you read the comments in one of the videos on this topic, you will see them being mostly in favor of the campaign: https://www.youtube.com/watch?v=zDnZd7UmBco.
It would be difficult to imagine many of my US friends advocating for stealing company secrets. I am not implying that either group has better ethics - they just have different attitudes towards the concept of ownership.
> In the US, you get to keep your house no matter how much anyone - including the government - would prefer you didn't.
Not true at all. Eminent Domain is a real thing. The controversies have generally been when there is a dispute over whether the taking is for a public benefit, e.g. condeming property to make way for a private business.
I'm your neighbor to the south (slovenia)... here, your house is practically untouchable if you mess up, but most people want other people to be taxed for owning a house. They also want owners of vacant properties taxed a lot more (which they believe would create more rentable apartments, but vacant apartmnts in big cities are rented out without contracts and without tax - usually to students, who prefer a risky cheap apartment, to a contract+more expensive, and vacant houses outside of cities are empty because literally noone wants to live there - you can buy a house with a large yard around it for a price of a used WV Golf in some parts of slovenia, and maybe half a bathroom in our capital). The same people also want people making money by renting out apartments pay more taxes on rent, because they somehow believe that the increase of taxes wont mean increase in rent prices.... i have no idea why.
But our largest problem is the same as in many other cities, including San Francisco.... want to build something? You have to buy a run down house, because you're not allower to build stuff on farming area, literally by the city center... and when you build a house, it can be 2 family house max. We need huge apartment buildings, but finding an area where an invester can build ones is impossible, because our municipality and goverment don't allow it.
| In the US, you get to keep your house no matter how much anyone - including the government - would prefer you didn't.
That's not accurate. The US, state and city governments can most definitely take private land and convert it to public use if enough people benefit from it.
There are other means as well, a city could purchase something on the open market, or a county could purchase land and convert into a public park, or what ever suits them.
I legitimately wanted to evaluate the argument here but there’s so much backstory and political contextualization I gave up reading this without ever having found out what the Viennese did.
They have a steeply progressive land value tax and further escalate taxes on vacant land. They also slashed taxes on development and construction. This encouraged productive use and efforts to keep assessments low which also drives down housing costs.
> If we don’t want Vancouver to go down this path, then perhaps we should heed Henry George’s advice: tax land and use the proceeds to build the housing we need.
Vienna is the most dull and calcified city I've ever lived in, and it's not a growing city. It's not super useful to compare to cities that are thriving.
A city government manipulating the price of urban property so that it can purchase it? This doesn’t seem like a workable model. Doesn’t that reduce property tax revenue? Doesn’t that affect the value of other land in general? Why wouldn’t urban land holders sue the city for damages?
Unlike some other places (the US?), in Austria property tax is a relatively minor part of cities's finances. It's also computed based not on "actual" property values but on fictional values that haven't been adjusted since 1973 or so. For both of these reasons, the city doesn't stand to lose from sinking land prices (not that they are sinking).
Also, I can't find the numbers right now, but a lot of land in Vienna is owned by the Catholic Church. Religious organizations are conveniently exempt from property tax.
> Why wouldn’t urban land holders sue the city for damages?
As far as I can tell, Austrian courts don't subscribe to a notion that investments in real estate should be guaranteed to be risk-free.
If we are going to get government involved in this, then why not shift to cheaper area? There's cheaper land in more rural areas that the government could develop and entice businesses to move to. This would be cheaper for the tax payer. There's also an exodus from many cities which leave abandoned buildings that could be converted to living space.
Maybe the article works for Vancouver (I've never been there), but I don't see it working in most places.
[+] [-] kcorbitt|5 years ago|reply
[+] [-] tom_mellior|5 years ago|reply
You can't just take those two data points and assume that they are connected by a straight line. Vienna was down to about 1.5 million around 1990 and has been growing since. https://en.m.wikipedia.org/wiki/Vienna#Demographics
> Vienna's rents are stable and low
For the record, they are neither. There has been crazy, and accelerating, growth in rental costs over the last ten years.
[+] [-] renewiltord|5 years ago|reply
[+] [-] mschuetz|5 years ago|reply
[1] https://www.derstandard.at/story/2000067989262/wohnhistorike...
[+] [-] larsiusprime|5 years ago|reply
For a full assessment I would like to see other Austrian cities that have had similarly stable population sizes but don't have Vienna's policies.
[+] [-] jeffbee|5 years ago|reply
[+] [-] statstutor|5 years ago|reply
Islington (London)'s population is around half what it was in 1914, but rents are out-of-control.
[+] [-] pchristensen|5 years ago|reply
[+] [-] mwerd|5 years ago|reply
[+] [-] polote|5 years ago|reply
[+] [-] larsiusprime|5 years ago|reply
> As both the Vienna model and Henry George[1] would suggest, the problem is forever and always the cost of land. Burdensome land costs, and the rentiers who gain massive wealth by passive land speculation, are the real enemies — not developers, not our homeowners, not our public officials.
[1] https://thetyee.ca/Solutions/2018/06/04/Tax-To-Solve-Housing... (linked in the article)
EDIT: From the looks of it Vienna's policy isn't purely Georgist, but it has a few policies (namely land tax, particularly on vacant lots) out of Henry's playbook.
[+] [-] giantg2|5 years ago|reply
[+] [-] epistasis|5 years ago|reply
[+] [-] franze|5 years ago|reply
These "Gemeindebauten" (affordable cheap public housing) have good flats and good areas and bad flats and bad areas. So if you want to be in the really good ones, you better have the right "Parteibuch" (party affiliation) or a friend who has it.
Said that, Gemeindebauten are a great but flawed system.
[+] [-] franze|5 years ago|reply
[+] [-] forrestthewoods|5 years ago|reply
The article doesn’t make a strong attempt to explain how their housing affordability is “solved” though. How easy it to find a new apartment to rent? How much does it cost? What do you get for that price? How does this compare to other cities in Europe? How does Vienna compare to other Austrian cities which did not buy up land?
It’s an interesting case study and I’d love to know more. But this article leaves a LOT of open questions.
[+] [-] haspok|5 years ago|reply
Which sucks if you find a job somewhere else, or just choose badly and it turns out the neighbours are loud, or the house is a sh*tty concrete building with paper walls built in the 50s...
If you are very lucky or have connections, you can rent privately, and then you don't have to pay the Makler. But the number of apartments available like this is very low, I'd say <10%.
I moved here from the UK, and while the UK (especially London) has its problems, I would choose that system _any time_ over what's here in Vienna.
To add insult to injury, the housing prices are sky-high, almost as bad as in London, while the salaries are much lower. So buying an apartment is not really an option unless you can sell another one, or get some support from family.
On the other hand, my wife lost her job, and for the first 5 months or so she gets more than 50% of her salary as Arbeitslosengeld. So that offsets the extremely high taxes a bit.
[+] [-] phaer|5 years ago|reply
Hard to compare it to other Austrian cities, because those are generally much smaller (but can be more expensive than Vienna(.
[+] [-] jeffbee|5 years ago|reply
[+] [-] masswerk|5 years ago|reply
More like, city imposes a variety of luxury taxes dedicated to fill the gap left by private businesses in providing homes. While the public building program never made up a major share of the total, it still provided housing to the poor and working class and also provided a base line for the market.
[+] [-] Irishsteve|5 years ago|reply
To find an apartment was easy in their case (4-5 days) the total cost is similar to Berlin and about 50% the price of Dublin.
[+] [-] arcticbull|5 years ago|reply
[1] https://en.wikipedia.org/wiki/Public_housing_in_Singapore
[+] [-] Barrin92|5 years ago|reply
Often when I talk to Americans about public housing a really common argument is the image of public housing as a sort of racist thing that creates enclaves for certain (usually low-income) groups. Yet Singapore, with its integration policies has virtually completely avoided this, and it basically can only do it effectively because it controls the housing stock.
It's not a utopia but the degree to which people intermingle and live together is quite astonishing if you're used to French Banlieues or the segregation in many American cities today.
[+] [-] gyulai|5 years ago|reply
[+] [-] masswerk|5 years ago|reply
[+] [-] bane|5 years ago|reply
[+] [-] tom_mellior|5 years ago|reply
[+] [-] peter_d_sherman|5 years ago|reply
PDS: An interesting cycle (or set of cycles) of cause and effect...
Disclaimer: I am neither for nor against rent control...
[+] [-] aerosmile|5 years ago|reply
This difference comes from different attitudes around ownership. In places like China and Russia, owning a house means you get to keep the house unless enough people would benefit from you not owning it. In the US, you get to keep your house no matter how much anyone - including the government - would prefer you didn't.
Europe is somewhere in between on that spectrum, and this attitude extends to not just land ownership. For example, a popular ad campaign in Austria is demanding from the employees of BioNTech to leak the base components and production instructions so that other companies can steal those trade secrets and supposedly help generate more vaccines. If you read the comments in one of the videos on this topic, you will see them being mostly in favor of the campaign: https://www.youtube.com/watch?v=zDnZd7UmBco.
It would be difficult to imagine many of my US friends advocating for stealing company secrets. I am not implying that either group has better ethics - they just have different attitudes towards the concept of ownership.
[+] [-] throwawayboise|5 years ago|reply
Not true at all. Eminent Domain is a real thing. The controversies have generally been when there is a dispute over whether the taking is for a public benefit, e.g. condeming property to make way for a private business.
[+] [-] ajsnigrutin|5 years ago|reply
But our largest problem is the same as in many other cities, including San Francisco.... want to build something? You have to buy a run down house, because you're not allower to build stuff on farming area, literally by the city center... and when you build a house, it can be 2 family house max. We need huge apartment buildings, but finding an area where an invester can build ones is impossible, because our municipality and goverment don't allow it.
[+] [-] jarjoura|5 years ago|reply
That's not accurate. The US, state and city governments can most definitely take private land and convert it to public use if enough people benefit from it.
https://www.justice.gov/enrd/history-federal-use-eminent-dom...
There are other means as well, a city could purchase something on the open market, or a county could purchase land and convert into a public park, or what ever suits them.
[+] [-] ghgdynb1|5 years ago|reply
[+] [-] ch4s3|5 years ago|reply
[+] [-] chrischen|5 years ago|reply
[+] [-] dantheman|5 years ago|reply
[+] [-] fantod|5 years ago|reply
[+] [-] r0f1|5 years ago|reply
[+] [-] masswerk|5 years ago|reply
The article is about the situation the city was left in after a quite rapid growth from 0.5M in 1851 to 2M in 1910, just before WWI.
[+] [-] dang|5 years ago|reply
[+] [-] unknown|5 years ago|reply
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[+] [-] rhacker|5 years ago|reply
[+] [-] wallacoloo|5 years ago|reply
[+] [-] jschveibinz|5 years ago|reply
[+] [-] tom_mellior|5 years ago|reply
Also, I can't find the numbers right now, but a lot of land in Vienna is owned by the Catholic Church. Religious organizations are conveniently exempt from property tax.
> Why wouldn’t urban land holders sue the city for damages?
As far as I can tell, Austrian courts don't subscribe to a notion that investments in real estate should be guaranteed to be risk-free.
[+] [-] giantg2|5 years ago|reply
Maybe the article works for Vancouver (I've never been there), but I don't see it working in most places.
Why downvote with no reply?
[+] [-] em-bee|5 years ago|reply