Institutional prerequisites for affordable housing development A comparative study of Germany and Sweden

This thesis was written against the background of intense public debate on increasing housing shortages and housing policy reform in Germany and Sweden. Potential reforms to increase housing development volumes, especially in the affordable segment, are analysed using theories of institutional change with focus on urban planning, building law and housing policy. The instruments analysed are divided into measures intended to increase housing supply elasticity and targeted affordable housing measures. Three measures intended to increase housing supply elasticity that could be transferable to Sweden are identified: 1) Development planning could be reformed through facilitated procedures, the introduction of private initiative in planning and new incentives of planning authorities. 2) The planning and building legislation could be reformed to facilitate building approvals in relation to serial housing construction, which in turn could increase the number of affordable homes being built. 3) City housing policy could promote housing development through more intense use of the policy instruments of organisation, urban planning, municipal land and subsidies, with city organisation and political attention to housing markets being identified as crucial. However, effectively targeted affordable housing policies are difficult to implement under the current Swedish housing policy regime. In the short term, Swedish housing policy should therefore concentrate on housing supply elasticity-enhancing measures. However, considering the increasing pressure on the affordable housing supply and future expected demographic changes, public discussion of potential future solutions would be valuable. A first step would be to compile housing statistics such that the affordable housing shortage and the opportunities to design effective measures to counter it could be better understood.