Kittilä municipality buys 30 apartments for one euro to secure affordable housing

The municipality of Kittilä in Finnish Lapland has acquired 30 rental apartments for the symbolic price of one euro to bring them under municipal control and fund urgently needed renovations, reports Finnish public broadcaster Yle.

The unusual transaction allows the local government to legally provide loans and guarantees for repairs, as the remote housing companies—located in the villages of Alakylä and Tepasto—have been unable to secure bank financing. Banks have refused loans due to insufficient collateral, despite renovation costs for projects like roof replacements being under €100,000.

The apartments, built in the 1980s and 1990s with state-subsidized ARA funding, require major repairs, including new roofs and interior updates. However, low occupancy rates—ranging from 60 to 90 percent—mean rental income falls short of covering costs. Under Finland’s ARA system, rents are calculated based on actual expenses, assuming full occupancy.

Originally constructed by now-dissolved elderly housing associations, the properties risked being sold to private buyers or short-term rental operators. The municipality’s purchase ensures they remain available as long-term, affordable housing. “We want to prevent these from ending up in short-term rentals,” said Timo Sattanen, CEO of Kittilä’s municipal housing company, which will manage the properties.

Some residents, like Eila Jatkola, who has lived in her Alakylä apartment for 32 years, were unaware of the ownership change. The municipality has previously provided minor financial support to the housing companies but lacked the legal authority to offer larger loans until now.