Hanna Dhalmann warns of housing challenges in Helsinki due to funding cuts

To prevent regional inequality or segregation, various housing options must be available in all areas, says Hanna Dhalmann, the head of the housing program in Helsinki. Dhalmann warns that efforts to mitigate segregation in Helsinki may face challenges due to the government’s decision to stop funding new ownership-based housing after 2025. This change puts the city in a new situation and complicates diverse construction initiatives.

For example, the Meri-Rastila area may miss out on several hundred new ownership-based apartments due to this policy. Dhalmann emphasizes that mixing rental, ownership, and intermediary housing has proven effective in combating segregation. Currently, approximately 500 to 1,000 new ownership-based apartments are built annually in Helsinki.

She adds that attempts to replace these lost units with new rental and ownership models are still in the planning stages and may take at least three years to implement. Hence, quick solutions seem absent for replacing ownership-based housing production.

Environmental and Climate Minister Kai Mykkänen has clarified that the government will not reverse its funding decision, citing specific risks associated with ownership regulations that could lead to problems as these properties age and renovation costs rise.

The government, along with the nine largest cities, has initiated a study to assess the need for intermediary housing production. However, no clear rationale was found for this model, as issues such as market-driven housing displacement and increased bureaucracy were highlighted. Nonetheless, the study suggests that addressing segregation requires political action in housing.

Dhalmann stresses that simply focusing on the rental versus ownership ratio is not enough; areas must also provide quality services such as schools and recreational facilities to prevent the deepening of inequality.