LPE Europe – Student Housing Series – Vienna

With Yvonne Franz and Elisabeth Gruber

Conducted and edited by J.K. Langeveld

Rome, Rotterdam, Amsterdam, Glasgow, London, Berlin. The list goes on. Students struggle with finding affordable and decent accommodation, often being forced to extremely long commutes. International students often face even more precarious conditions, despite bringing so much to the local intellectual and economic life. In this blog post we discuss the situation in Vienna with Elisabeth Gruber and Yvonne Franz, the authors of the article ‘The Changing Role of Student Housing as Social Infrastructure’. Elisabeth Gruber is a Post-Doctoral Researcher & Lecturer at the Department of Geography of University of Innsbruck and Yvonne Franz is a Post-Doctoral Researcher & Lecturer and scientific director of the master program “Cooperative Urban and Regional Development” at the Postgraduate Center of University of Vienna.

Vienna was often referred to as the “city of social Housing” due to its extensive and successful history of providing affordable and high-quality housing for its residents. Can you still call Vienna the “city of social housing”?

Vienna is a renter’s city like many other cities in Europe. What makes the difference? Vienna can be considered a city with a remarkable amount of social housing. Social housing includes both council housing, where the municipality owns and rents apartments, as well as subsidized housing, mostly built by limited profit housing cooperations. Around 43% of all units fall into the category of social housing in Vienna. The large stock of social housing always had a hampering price-effect on the Viennese housing market, overall. Until today, Vienna’s rental housing market is relatively ‘affordable’ compared to other European capitals.

But we should not forget the “legacy” of development processes in the past. In the 1980s and 1990s, Vienna experienced a significant decline in population. The housing market was not tensed, although a high share of housing was considered low-quality housing (with toilette or washing opportunities outside the flat, no proper heating, etc.). Still, for students back then, it was relatively easy to find housing at low cost on the private market, and it was not necessarily only from a cost-perspective to find a place in institutional student housing, the so-called purpose-built student accommodation (PBSA). Non-profit PBSA in Vienna was on the one hand of interest, from an economic point of view for students since it supported living at a very low costs, but it was also probably interesting from a social point of view. As an arrival space to newcomers, it was easier to make friends and get to know the city and student life. Throughout the 1990s and the early 2000s, waiting lists existed for student housing because the demand was high. But still, providing housing to students was not really seen as a priority area, probably since, in general, housing costs were rather low. In the year 2010, public funding for the erection of non-profit student housing (back then only non-profit providers existed) was withdrawn by the state. This change in public funding regimes created a window of opportunity for private, mostly for-profit PBSA providers to step into the market. This happened for the first time in the year 2013, and after that, the number of private investors entering the student housing market increased rapidly.

Why should student housing be considered as part of social infrastructure, as you argue in your article? And how do the current changes impact the role of student housing as social infrastructure? 

Looking at student housing through the lens of “social infrastructure” provides an important opportunity to look at the social amenities and the broader impact of student housing on social cohesion in cities. While we might agree on the perception of housing as a basic need everybody should have access to, this does not fully capture the actual living environment that is key to everybody’s senses to feel comfortable or even at home in a (new) city. Social infrastructure touches on spaces of encounter, such as libraries or community spaces, which provide the opportunity for social interaction – even beyond the own peer-group. This is related to availability, but also accessibility. Here comes our geographical approach into play that tries to connect specific processes with its spatial impact: While the older non-profit PBSA in Vienna is located quite centrally, student housing could be considered as an active part of a historically grown and changing neighbourhood. This includes the provision of everyday services catering to students, but also conflicts due to social events that impact the living environment within the entire neighbourhood. Contrary to this, new-built PBSAs in Vienna are often pioneer housing in new urban development areas, where communities still have to emerge and establish. It takes a long time to build up relations between neighbours – and is stays in contrast to the relatively short period of time students spend in PBSA. As a result, there might be rather coexistence than cohesion between PBSAs and the new residents within a new urban development area. Further, in our interviews, we also heard of private PBSA that, out of economic efficiency and in order to keep rents low, did not include common rooms for students in their concepts. For us, this points away from the concept of PBSA as social infrastructure. Of course, the question of affordability is also the one to ask when it comes to new developments in student housing. As we pointed out, during the 1990s, institutional student housing was an approach to supporting not-so-well-off students by giving them the possibility to come and study in a city. Luxury student housing is rather offering a home for the cosmopolitan student at a certain budget.

Do you consider the entrance of private investors and developers into the student housing market as a positive or negative development? 

When we started our research at the end of 2019, we took a very critical approach to the emerging private student housing market. In the context of Vienna as a social housing city, it was obvious that private for-profit providers may charge higher prices for their student accommodation, and not always we found this reasonable, at least concerning the locations of the buildings. But we learned during our research that we also need to consider a more diverse understanding of the demands of students. Not all students who arrive in Vienna for their studies are actually financially vulnerable. Especially international and non-EU students demand luxury apartments and certain amenities, such as a private cooking opportunity, private bathrooms or a double bed. Therefore, a private offer might be reasonable, in case it represents a complementary offer. Further, during our expert interviews with non-profit as well as PBSA providers, we learned that due to the entrance of private investors into the student housing market, non-profit PBSA had to increase their quality standards. They began to renovate their buildings, to offer more single-rooms as well as high-speed internet, but they also started to adapt their marketing and communication concepts. This has also been a matter of competition. To conclude, as long as the diversity of different accommodations at different price segments is high, this is a development that can be considered positive, but of course, when the low-cost segment, which is well needed, disappears, it will be a matter of concern.

Further, student housing built by private for-profit investors is under constant threat of being changed into other housing segments, so it might well not represent a sustainable number of housing units. Further, some private for-profit investors are not aware of their function of providing possibilities for community-building, such as support services for newly arrived students, community work and collaboration activities with direct neighbours. As we mentioned: Social infrastructure is considered to include “more than housing”.

Have you identified any current or upcoming issues with regards to student housing in Vienna? 

Our study just started during the first months of the COVID-19 pandemic. Since then, we have observed constant upcoming issues, but none of them has been stable enough until now to be traced from an empirical point of view. During the pandemic, student homes had difficulties with students who went back home to their parents and also international students who were not able to receive a VISA, to travel, or arrive in their new university city. However, this effect lasted only for a short while. Currently, it would be interesting to see how the market will react to general changes in the real estate market. Due to inflation and rising building costs, more new housing projects are on hold, which would have an effect on general housing demand. Further, the mobility of students, especially from non-EU countries, will again increase due to an attractive university landscape and relatively low tuition fees. Also, Erasmus mobility within Europe is catching up again.

In the article you write that the student housing market in Vienna is rather saturated and that the focus is more on renovating existing locations and improving qualities and standards than expanding to new locations. How do you see this situation in comparison with other European cities, as many cities face large problems with providing sufficient student accommodation. Do you think Vienna can be seen as an example for these cities?

We come back here to the beginning of the interview: Compared to other European cities, Vienna is different. Due to several factors in housing policies dating back in history, the city still has a relatively unstrained housing market in general. What we observe in other Austrian university cities (but also in Germany and other contexts) is that students are outperforming other actors on the housing market, e.g., families. A flat-share of five students, each paying 500 Euros, can easily displace a family of five. In this case, Vienna can serve as a good practice example in a way that it offers a whole package of different affordable structures for different households and social groups.

On the other hand, while social housing projects that receive public funding are in general very much impacted by specific regulations and public guidelines (e.g., on social and ecological sustainability), private housing investors are relatively free in how and for whom they build and what they ask for in terms of costs.

As such, we critically emphasize the role of housing beyond its core function. Housing refers to individual and collective living environments. To make space for a growing but also diversifying urban population requires commitment and investment in social infrastructure by all actors: policymakers, public as well as private (investors), but also the residents themselves, who actually make their living environment and contribute to socially cohesive neighbourhoods.

In what ways do you think the legal structure or public policy regarding student housing is influencing the market?

Student housing is clearly embedded in a multi-level governance system. At European level, the Bologna process and the Erasmus mobility schemes have been fueling the residential mobility of students – without finding comprehensive answers, where they should live (mostly for a short time). At the national level, it is of key economic interest to have successful and internationally visible universities – again, without finding comprehensive answers where students, and also international mobile university staff should live (mostly for a short time). At the local level, university cities have to deal with housing for every resident in cities. As we are in the midst of a European housing crisis fueled by the global financialization of housing, this is not an easy task. In our opinion, student housing as a submarket of housing has remained off the radar of policymaking for a long time. That is also the reason why the private market has discovered this housing segment and why student housing is becoming an asset and investment opportunity. Providing housing for students is anyway something we consider critical, especially if we think of students not only as a temporary population but as future residents who should be part of our societies. If we think about the future, we would welcome a more nuanced understanding of housing beyond its housing function among all actors involved.

What could bring us forward in student housing might be a better cooperation between all governance levels and the various actors involved in student mobility on the one side and housing provision on the other side. One example: we learned from our interviews that there is not much communication between non-profit and for-profit PBSA actors, and even less between for-profit PBSA developers and the city. Policymakers and public actors seem not to be aware of the different logics and capacities among all actors. We further think that the public actors  need to make better use of their important role to communicate and claim the public interest. Unfortunately, multi-level governance in this case seems to complicate this. The student housing market therefore can be observed to be turning into a contested environment fuelled by multiple crises such as austerity policies, inflation, global financialization and climate crises. Still, reaching out to private actors and acknowledging their roles in the housing market would be necessary.

You write ‘Comparative research including the perspectives of other European cities would yield further insight into the converging of processes in the context of the internationalisation of higher education as well as the financialisation of student housing.’ Do you know whether this kind of research is being conducted at the moment? And how do you see your role as an academic with regards to the topic of student housing.

We are not aware of specific research on that topic, but we know that there are several authors doing research on student housing in different cities, and of course it is a topic of policy concern. But still, more exchange on different levels is always appreciated, e.g., we know from Austria that other university cities struggle even more on the topic of student housing, and on the other hand, these cities also have different ideas on how to face them. A comparative perspective would definitely be relevant. So far, we do not know about any comparative research being conducted here. For sure, we will contribute in our role as academics to future research projects. For us, it is not only important to contribute a critical perspective to mainstream processes. But even more so, to deal with societal challenges that are not yet well analysed and understood. Much work is ahead for future research!

 

 

Reference

Yvonne Franz and Elisabeth Gruber, ‘The Changing Role of Student Housing as Social Infrastructure’ (2022) 7 Urban Planning 457.

Gruber, E., & Franz, Y. (2019). What Can the Housing Market Teach Us? University Fieldtrips Identify Current Transitions in Vienna’s Urban Development and Housing Market Policies. Mitteilungen der Österreichischen Geographischen Gesellschaft, 161.

Franz, Y., & Gruber, E. (2018). Wohnen „für alle “in Zeiten der Wohnungsmarktkrise? Der soziale Wohnungsbau in Wien zwischen Anspruch und Wirklichkeit. Standort, 42, 98-104.

 

150 150 Law and Political Economy in Europe