A block of flats in Helsinki on 18 February 2020. Over a quarter of Finns are unsure whether their housing company has any outstanding debt, reveals a survey commissioned by Nordea. (Hanna Matikainen – Lehtikuva)


MANY Finns are unprepared for an increase in the interest rates of housing company loans and their impact on housing costs, finds a survey commissioned by Nordea.

Nordea on Thursday revealed that more than a quarter (27%) of the survey respondents were unable to tell whether their housing company has any outstanding debt. Almost half (46%) of the respondents who knew their housing company has outstanding debt were unaware whether the company has prepared for a rise in interest rates in any ways.

Almost three-quarters (73%) of respondents with a personal housing loan said they have prepared for a rise in interest rates.

Maiju Hinno, the director in charge of housing companies at Nordea, expressed her concern about the findings particularly given the recent surge in interest rates.

“A housing company loan is comparable to a business loan, and thereby its terms and flexibility are much more rigid from the viewpoint of an individual shareholder than a personal housing loan. Yet personal housing loans are protected against interest rate increases much more often than housing company loans,” she said.

“It feels that people are not taking into consideration the effects of possible interest rate increases on their finances as well in the case of housing company loans.”

Interest in guarding housing company loans against interest rate increases has grown notably from last year, though.

The 12-month Euribor, the most common reference rate for housing loans in Finland, has surged by more than 0.8 percentage points in the past couple of months to 0.313 per cent. The rate climbed above zero for the first time in over six years in mid-April.

Nordea reminded that an increase in the interest rate of a housing company loan will be reflected in the charge for financial expenditures, a part of the charge for common expenses paid by housing company shareholders.

The housing costs of shareholders are rising also as a consequence of surging energy prices, which are reflected in the maintenance charge. Energy prices have spiked during the course of this spring after Russia invaded Ukraine.

A total of 1,033 Finns responded to the online survey carried out by Kantar TNS between 10 and 16 November 2021.

Aleksi Teivainen – HT