University students living alone in Finland increase significantly since housing allowance reform

The number of university students living alone has significantly increased since they transitioned to general housing allowance in 2017, according to research from the Government Institute for Economic Research (VATT). The housing benefit reform in 2017 removed the housing supplement from most university students, switching them to general housing allowance. This change also made the allowance dependent on household income, meaning students could lose their housing support due to the earnings of others living in the same household.

Before the reform, around 40% of full-time university students lived independently. By 2022, this figure rose to over 60%. The change was 10 percentage points greater than the increase observed among other young people of the same age. More students also moved from shared accommodations or from living with partners to living alone, a trend not seen among their peers.

Students already living alone were less likely to cohabit with others, indicating that living independently became more permanent. Researcher Max Toikka from VATT noted that the housing benefit reform encouraged students to invest in their living situations, although the scale of the increase was surprising.

Despite a reduction in monthly student aid—from about €330 to around €250—housing support for students averaged greater increases. In fact, the costs of student housing benefits surged, rising from approximately €362 million in 2016 to nearly €700 million in 2023. However, the research did not find evidence of students upgrading to larger homes or moving to more expensive areas.

The government plans to revert students back to the housing supplement framework, effective August 2025, following a decision made in April 2024. The draft law estimates that approximately 156,000 students could see a reduction in support, with expected savings of €57 million by 2028.