High rents in big cities: what are the implications?

In theory, rising rents could be offset by higher salaries, writes Expresso:

“Of course, rents and property prices have been rising sharply for far too long and are unaffordable for many Portuguese. But it's not the fact that rents or square metre prices are rising that defines the magnitude of the problem, but the comparison between rent (or mortgage rate) and wages (or pensions) that makes the situation dramatic. The fact that incomes are not keeping pace with prices should be what worries us, not the nominal value of things per se. Wages also rise over time. The question is what we can afford to buy with them.”

The Irish government has increased the permitted size for cabins or sheds at the rear of a house to 45 square metres. A step in the right direction, says The Irish Independent:

“It is a good thing that may prove helpful to a people with housing difficulties, but it is not a remedy, much less a 'magic bullet', to resolve the chronic housing supply crisis. ... The measure additionally has the potential to dovetail with another topic that has generated more heat than light - downsizing by older residents to free up larger homes for a new generation.”

In Copenhagen, square metre prices have risen by almost 70 percent over the last decade. Jyllands-Posten fears that this trend will make the city increasingly lifeless in the long run:

“Ordinary Copenhageners - nurses, teachers, bus drivers, academics in precarious sectors - are being pushed further and further out of the city. It is both a social and a cultural failure to allow property prices in big cities to skyrocket like this. ... A city where only the richest and tourists can afford to live becomes nothing more than a soulless backdrop. ... Do we want Copenhagen to become a kind of architect's Disneyland, accessible only to the wealthy? Or do we want it to go on being a city where children are born and all kinds of people live, work and grow old together?”

The average waiting time for a rental apartment in Stockholm is ten years, which is why many people prefer to buy a home instead. But this is also no easy undertaking, Dagens Nyheter explains:

“According to a report by the Association of Swedish Real Estate Agents a young family in Stockholm may need to save for up to 30 years to be able to afford a down payment on a home. For the baby boomer generation who bought their own homes between the 1970s and 1990s it was just three years. ... A home is no longer a place to sleep, eat, love, care for and live in. In today's Sweden it's seen more as an investment. ... Another problem is the possibility to deduct interest payments from one's taxes. This makes it possible for homeowners to take out large mortgages, which in turn drives up property prices.”

The housing crisis is jeopardising equal opportunities and educational success, warns Clarisse Petel, a speech therapist at the Brussels-based social and health centre Cerapss, in a guest commentary in Le Soir:

“It's obvious that without adequate housing and the security of being able to stay there, the willingness of parents and children to learn will be relegated to the background. Our efforts to reduce educational inequalities depend directly on children's housing security and stability. In many ways, the success of social work is determined by how policymakers respond to the affordable housing crisis. The families we serve often have to accept substandard housing and few children have access to a quiet place to do their homework.”