Shift towards small rental apartments in housing construction in Helsinki, Tampere, and the capital region

Over the past 20 years, the size of apartments in Helsinki has decreased. Housing construction in Finland continues to concentrate primarily in Helsinki, Espoo, Vantaa, and Tampere. Approximately 43 percent of the total residential floor area constructed in the country between 2015 and 2021 was located in these cities. The annual volume of housing construction during this period was nearly twice that of the years 2000-2009. There have also been significant changes in construction practices and resident demographics, with some differences observed between Helsinki and other parts of the metropolitan region.

The findings of the study demonstrate a shift in housing production towards studio and one-bedroom apartments. The combined share of studios and one-bedroom apartments was approximately 57 percent in Espoo and Helsinki, nearly 70 percent in Vantaa, and as high as 76 percent in Tampere.

The average size of completed apartments between 2019 and 2021 has significantly decreased. In Vantaa, the average size was 47 square meters (compared to 86 square meters between 2000 and 2009), in Espoo 58 square meters (91 square meters), and in Helsinki 57 square meters (76 square meters). Additionally, the average size of studios and one-bedroom apartments has notably diminished.

New housing production has heavily focused on small units, with the majority being rented out. Ownership housing in these small units is marginal. Tampere serves as an extreme example, where out of 8,650 new studios, only 330 (4 percent) were owner-occupied units, while 6,875 were investment rental properties. Despite extensive production, the number of small owner-occupied apartments has even decreased, indicating the growing difficulty for young people to access homeownership.

However, the results highlight clear differences among the examined cities. Housing construction in Helsinki remains more diverse compared to the other cities included in the study.

"There has been a significant turnaround in the development of the Helsinki Metropolitan Area, as Helsinki is currently constructing larger apartment buildings than Espoo and Vantaa," says Mari Vaattovaara, a professor of urban geography at the University of Helsinki.

Furthermore, the proportion of state-supported affordable rental and right-of-occupancy housing is higher in Helsinki than in the comparison cities. Moreover, new residential areas in Helsinki have a more balanced population structure compared to those in other parts of the metropolitan region.

The study's findings raise important observations regarding the gap between realized and targeted housing production and the impact of these changes on the demographic composition of new residential areas.

"In the study, we present several new areas in the metropolitan region, many of which have become heavily dominated by rental apartments, particularly in Vantaa and Espoo, with very few family-sized units being constructed. The resident structure already shows signs of potential segregation," says population expert Pekka Vuori.

Mari Vaattovaara and Pekka Vuori previously published a similar study in 2002 when Helsinki was constructing a more one-sided housing stock compared to other cities but later adjusted its housing policy. The current results reflect those changes.

The research publication is part of the Helsinki City Executive Office's publication series on urban information services, which also includes the previous corresponding study.

HT