Denmark’s private non-profit housing system governance and finances examined (5 August 2020)

• Governing and financing affordable housing at the intersection of the market and the state: Denmark’s private non-profit housing system

• By Luise Noring, David Struthers, Adam Grydehoj. Published in Urban Research & Practice on 5 August 2020

• https://doi.org/10.2105/AJPH.2020.305661 (only paid access)

• Abstract:

  • Denmark’s private non-profit housing sector provides affordable housing and social housing and is capable of being self-governing and self-financing. This article examines the private non-profit housing sector’s governance and financing model.

  • Danish private non-profit housing has three primary characteristics: it is private and non-profit, it is governed by tenants, and it is largely financed by tenants. It is characterized by generally lower entry-level rents than comparable housing forms due to its relatively low construction costs, its favorable loans, and its non-profit nature. Danish municipalities use private non-profit housing organizations to supply subsidized social housing (with tenants receiving municipal housing allowances), so private non-profit housing plays a key role in supplying affordable housing in Denmark

  • Rental revenues are accumulated and reinvested in expanding housing, renovations, and social activities.

  • The article explores the Danish social housing system as a whole, and dives into the methods of financialisation of the housing sector.

  • This research involved a series of recorded key informant interviews. The interview subjects were selected due to their roles as major decisionmakers in Denmark’s private non-profit housing system. This method has its limitations: key informants of this kind can offer information about the perspectives of the leadership of the organizations they represent, but they cannot necessarily provide an understanding of the perspectives of, in this case, the typical tenant on a housing estate.

  • Conclusions: "However capable the private non-profit housing sector may be of undertaking independent governance and financing, its ultimate stability and sustainability depend upon a favorable political environment. Other countries and cities considering establishing a private non-profit housing system will need to grapple with the fact that the Danish model’s long-term governance and financial independence does indeed require an initial large-scale investment by state, private, or civic actors."

• Keywords: Affordable housing, Copenhagen, Denmark, financing, governance, housing policy, urban