Faroe Islands introduces rental subsidies for low-income households

The Faroese welfare committee has approved a new rental subsidy scheme for low-income households, with payments of up to 1,500 krona per month available from September 1, public broadcaster KVF reports.

Both the majority and minority factions of the welfare committee supported the proposal, which was presented in parliament on Saturday. The measure aligns with the coalition agreement’s pledge to provide rental assistance to households with low incomes.

Under the scheme, eligible tenants can receive up to 20 percent of their monthly rent as a subsidy, capped at 1,500 krona. Single-person households earning no more than 350,000 krona annually qualify for the full subsidy, while two-person households must have a combined income below 500,000 krona. The subsidy phases out as income rises, disappearing entirely for single-person households earning over 638,000 krona and for two-person households earning over 788,000 krona.

Applicants must not own any property that could serve as housing. The subsidy is tax-exempt.

The committee has also called on Margit Stórá, minister for social affairs and housing, to establish a legal framework for housing policy and the rental market, and to review existing regulations.

The proposal will undergo a second reading in parliament on Tuesday.