The Social Housing Secret: How Vienna Became the World’s Most Livable City

GUARDIAN, Philip Oltermann, January 12, 2024 

In the Austrian capital, renters pay a third of what their counterparts do in London, Paris or Dublin. How is it possible?

The first place that Max Schranz moved into after leaving his family home is the kind that many young professionals dream of inhabiting at the peak of their career. At only 26, he lives in a bright fifth-floor apartment with high ceilings overlooking a European capital city, 10 minutes from the central station and within walking distance of cinemas, theatres and bars.

No lottery win or parental trust fund was needed to make that dream a reality: Schranz, who is a master’s student, pays €596 (£512) a month for his 54 sq metre two-bedroom apartment – a fraction of typical rents for similarly sized and similarly located apartments in other major European cities. What’s more, he didn’t have to put down a deposit and his rental contract is unlimited – in theory, he’s allowed to pass it on to his children or a sibling when he eventually decides to move on. “I’m aware it’s a pretty stress-free existence,” Schranz says. “My friends in other European cities are a bit jealous.”

Welcome to Vienna, the city that may have cracked the code of how to keep inner-city housing affordable. As other cities battle spiralling rental prices, partly fuelled by inner-city apartments being used as short-term holiday rentals or being kept strategically vacant by property speculators, the Austrian capital bucks the trend. In the place that last year retained its crown as the world’s most livable city in the Economist’s annual index, Vienna’s renters on average pay roughly a third of their counterparts in London, Paris or Dublin, according to a recent study by the accounting firm Deloitte.

Part of the reason Schranz’s apartment is so affordable is simple: it’s owned by the city. In Vienna, that is (almost) the norm. The landlord of approximately 220,000 socially rented apartments, it is the largest home-owning city in Europe (in London, which has more than 800,000 socially rented apartments, they are owned by the local councils). A quarter of the people who live in Vienna are social tenants – if you also include the approximately 200,000 co-operative dwellings built with municipal subsidies, it’s more than half the population.

Many of these apartments came into being a century ago, as part of an enormously ambitious building programme after the end of the first world war, when Vienna was awash with people uprooted by the collapse of the Habsburg empire. Funded primarily through a hypothecated tax on luxuries such as champagne or horse-riding, the inaugural phase of socialist-governed “Red Vienna” saw 65,000 socially rented apartments shoot up within the city by the time of the Nazi coup attempt in 1934.

These “superblocks” from the 20s and 30s don’t look like ordinary social housing. With the modernist ideals of the contemporaneous Bauhaus school yet to capture the imagination of Austrian architects, for one, they haven’t got flat roofs. The most famous examples of Red Vienna social housing, such as the Karl Marx-Hof in the 19th district or the estates dotted along the “Ring Road of the Proletariat” on Margaretengürtel, look more like castles or monasteries, with art deco flourishes on their facades. As the historian Eve Blau has put it: “If you’re planning something radical, it’s not a bad idea to come across as conservative as possible.”