Record number of housing cooperatives file for bankruptcy in Finland

Last year 62 housing cooperatives in Finland filed for bankruptcy, the highest number since the 2000s, according to Yle.

Experts cite unmanageable renovation debt and unpaid maintenance fees as the primary causes. In some cases, cooperatives lack the funds even to complete the bankruptcy process, leaving buildings abandoned.

Lawyer Touko Raitis, who has handled numerous cooperative bankruptcies, said properties in areas with weak demand can become nearly worthless. “If the cooperative cannot afford the bankruptcy process and no buyer emerges, the building is left to deteriorate,” Raitis said. “It may become an environmental hazard if oil tanks leak or other problems arise.”

The Finnish Association of Building Managers (Isännöintiliitto) called on boards to address the growing issue of “ghost cooperatives.” A legal amendment taking effect in October introduces a one‑month moratorium after bankruptcy filing, during which owners retain control of their apartments.

Interim CEO Marianne Falck‑Hvilstafeldt of Isännöintiliitto said the bigger challenge is vacant properties left behind when bankruptcies collapse. “These abandoned buildings remain, even though the cooperative no longer exists,” she said. “Society needs to find solutions for managing these properties.”

Unpaid maintenance fees from investors have also pushed cooperatives into bankruptcy. In Virrat, Pirkanmaa, two apartment buildings filed for bankruptcy this month after investor defaults left the cooperatives unable to cover costs.