Rental housing CEO warns of “slave contracts” in land lease agreements

A leading Finnish housing executive has called for legal reforms to protect homebuyers from exploitative land lease terms, warning that some agreements amount to “slave contracts” that can multiply housing costs unexpectedly.

Timo Metsola, CEO of rental housing agency Vuokraturva, told public broadcaster Yle that leasehold land contracts—particularly those managed by investment funds—often contain automatic rent increase clauses that buyers remain unaware of until costs surge. “The worst cases could be called slave contracts,” Metsola stated in a Wednesday press release, describing some terms as “downright swine-like.”

Metsola proposed mandatory disclosure rules for property sales, requiring sellers to clarify potential rent hikes tied to the land lease before finalizing transactions. He also urged lawmakers to define legal limits on “reasonable” lease terms, drawing parallels to existing tenant protection laws. “The Residential Leases Act already regulates what terms rental agreements can include. Similarly, we could legislate to restrict land lease conditions and set boundaries for fairness,” he said.

The issue stems from a shift over the past decade, as institutional investors—such as pension funds and private equity—acquired land beneath housing cooperatives, separating land ownership from the buildings above. Metsola estimated around 20 such funds now operate in Finland. Many buyers, he noted, purchase apartments without ever seeing the land lease agreement, which may include automatic inflation-linked increases or other hidden costs.

“The goal was once to lower housing prices by keeping land off the market, but land funds turned it into a tool to extract higher profits,” Metsola explained. He cited cases where annual land rents jumped by over 20% in just a few years, echoing reports from Helsingin Sanomat and warnings from the Bank of Finland about obscured housing costs.

Metsola’s call follows recent high-profile cases, including a Vantaa housing cooperative whose land rent rose sharply and a Tampere policy adjustment after a tenfold lease hike. The Bank of Finland previously flagged that fund-owned leases can distort perceived affordability, while a 2026 Helsinki ruling forced a rent reduction in one disputed case.