The Municipal Housing Company (Félagsbústaðir) to build 3000 apartments

Socialists want the Municipal Housing Company to build three thousand new apartments as soon as possible.

Firstly, the Municipal Housing Company can afford this

The equity of the Municipal Housing Company was 67.3 billion Icelandic króna at the end of last year. That is more than 53% of the company's assets, 29.4 billion more than can be considered necessary. Real estate companies on the market, Reitir, Reginn, and Eik, have an equity ratio of about 30%. The equity of the Municipal Housing Company above these limits could therefore support the construction of apartments for up to 100 billion Icelandic króna. With that power, it would be possible to build 3000 apartments without any difficulty.

Secondly, the Municipal Housing Company can finance the construction of the apartments

The bond offerings of the Municipal Housing Company have been successful, as the company enjoys the guarantee of the city treasury and also has excellent collateral. There is no better collateral than the apartments of low-income people. And various other financing options are open to the Municipal Housing Company. Reykjavík City should advocate for loans for general housing to be for a longer period than 50 years, but current laws have such a limitation. With longer-term loans, rent at the Municipal Housing Company can be significantly reduced.

Thirdly, the city itself can build the apartments

Reykjavík City owns plots of land and owns the Municipal Housing Company which has the financial capacity for housing construction. The city therefore does not need to wait for anything, not to wait for contractors to build apartments so it can buy them with a generous markup. Reykjavík City can build these apartments itself, establish the Reykjavík Construction Company (Byggingarfélag Reykjavíkur), as Socialists have proposed.

Fourthly, there is a need for 3000 apartments

A large number of families and individuals are stuck in an unregulated rental market and pay excessively high rent there, which pushes these people into poverty. Waiting lists for apartments from the Municipal Housing Company tell only half the story, and barely that. Conditions to get an apartment from the Municipal Housing Company are very strict. It is not enough for people to be poor, but they must have experienced trauma, be ill, or otherwise be in a bad situation beyond having low incomes and having to pay outrageously high rent.

Fifthly, this will ensure social mixing within the Municipal Housing Company

City authorities have feared that rapid development of social housing could lead to insufficient social mixing in neighborhoods, that too many poor people live in too small an area. This attitude is characterized by anti-poor sentiment. City authorities have no concerns about insufficient social mixing in the luxury apartment blocks on Skúlagata. But by increasing the number of general apartments within the Municipal Housing Company from just over two thousand to just over five thousand, the conditions for getting an apartment will be lowered and the residents will automatically become more mixed, coming from more diverse groups.

Sixthly, the development will ensure social mixing in the city

A major effort is needed to ensure social mixing in the city's neighborhoods. For example, there is far too little social housing in Melar and Hagar, in Fossvogur, in Laugarás, and elsewhere. By building 3000 new apartments throughout the city, but especially where few such apartments currently exist, better social mixing in the city can be ensured, making its neighborhoods more diverse and democratic.

Seventhly, this will make the city better

The housing crisis is the unique phenomenon that has had the worst impact on living standards in the city. It is therefore a priority to address its roots. And the roots lie in the housing problems of low-income people. That is where the greatest pain is. The best way to solve the housing crisis is to build for the people with the greatest housing problems.

This is the proposal of the Socialists for the municipal elections on May 14th, that the Municipal Housing Company build 3000 new apartments. Socialists trust that city residents will choose the best solution, the most sensible and just one. That is why they put forward such proposals.