Land Policy Instruments for the Provision of Social and Affordable Housing

This resource titled "Land Policy Instruments for the Provision of Social and Affordable Housing" is published by EqualHouse and authored by Phil O'Brien, Alice Earley, Lucy O'Hara, and Julie Lawson. The project has received funding from the European Union Horizon Europe research and innovation programme under grant agreement 101132325.

Land policy is crucial in addressing housing affordability in Europe, where land constitutes a significant portion of housing costs. The report highlights that land price increases explain up to 80% of the post-war housing boom in various advanced economies. Effective land policies can support affordable housing alongside financial subsidies and regulatory measures.

The report identifies several strategies and mechanisms for utilizing land to provide affordable housing, categorized into market replacement, shaping, and enabling policies. Key instruments include public land banking, public land leasing, community land trusts (CLTs), and inclusionary zoning. These instruments aim to create a sustainable and equitable housing market.

Public land banking involves governments acquiring and managing land to promote strategic development, particularly for affordable housing. This approach can prevent land hoarding, stabilize housing markets, and ensure that land is available for public interest projects. Successful examples include the Wohnfonds Wien in Austria, which coordinates urban planning with public interest goals.

Public land leasing separates ownership and use rights over land, allowing governments to retain long-term benefits while providing developers with access to land for affordable housing. This strategy generates revenue for public investment and ensures that the benefits of public infrastructure investments are shared with the community. Helsinki's approach, where 70% of land is publicly owned, exemplifies effective land leasing policies.

CLTs are non-profit organizations that aim to provide long-term affordable housing by owning land and leasing it to residents. This model ensures that homes remain affordable over time and empowers local communities by involving them in decision-making. CLTs in Brussels and London have successfully provided housing solutions for vulnerable populations.

Inclusionary zoning mandates that a portion of new developments must be allocated for affordable housing. This policy can enhance socioeconomic diversity within neighborhoods and is effective in areas with high land values. For instance, Barcelona’s 2018 policy requires 30% of new developments to include affordable units, addressing a significant housing deficit in the city.

Land readjustment involves restructuring land parcels to facilitate development and improve infrastructure. This method can increase land values and enhance community benefits. The German system of land readjustment is well-established and allows municipalities to implement binding land use plans effectively, promoting affordable housing.

The report emphasizes the importance of land policies in promoting affordable housing across Europe. It highlights that the success of these policies relies on effective public intervention, legal frameworks, and political commitment to fostering equity in housing access. By leveraging land value capture and strategic interventions, policymakers can create inclusive housing solutions that meet the needs of diverse communities.