New trends in social housing allocation – case study (City of Poznań, Poland)

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Abstract

In recent years, the allocation of social housing has undergone a radical change. Local governments as well as housing organisations providing social housing are revising the procedures applied in the field by modifying methods for ranking applications. European experience shows that the general tendency is to replace the traditional allocation mechanism based solely on the criteria of income and needs with the one incorporating (though to a limited extent) the preferences of potential tenants. An example of innovative practice is announcing unoccupied social flats in the press and on the Internet which gives prospective tenants the opportunity to rethink the match between the housing conditions offered and the household’s needs. The aim of the paper is to explore various models of housing allocation used by local governments in EU countries and identify new trends within the field. A special focus is on the local regulations applied in the City of Poznań. Some information applied in the process of preparation of the paper has been obtained while conducting the research project “Social housing and its role in satisfying the housing needs of indigent households in Poland” financed by the National Science Centre (2014/13/N/HS4/02100).

Abstract

In recent years, the allocation of social housing has undergone a radical change. Local governments as well as housing organisations providing social housing are revising the procedures applied in the field by modifying methods for ranking applications. European experience shows that the general tendency is to replace the traditional allocation mechanism based solely on the criteria of income and needs with the one incorporating (though to a limited extent) the preferences of potential tenants. An example of innovative practice is announcing unoccupied social flats in the press and on the Internet which gives prospective tenants the opportunity to rethink the match between the housing conditions offered and the household’s needs. The aim of the paper is to explore various models of housing allocation used by local governments in EU countries and identify new trends within the field. A special focus is on the local regulations applied in the City of Poznań. Some information applied in the process of preparation of the paper has been obtained while conducting the research project “Social housing and its role in satisfying the housing needs of indigent households in Poland” financed by the National Science Centre (2014/13/N/HS4/02100).

Introduction

Social housing constitutes a specific stock of (mostly) rental dwellings that can function as a parallel form to the commercial market (in the case of a unitary system) or as a separate and sometimes competing structure (a dualist system). It is part of the housing sector that is characterised by lower tenancy costs for households thanks to different types of subsidy. To be qualified to receive social assistance, a given dwelling needs to meet the following criteria: production and/or financing costs should provide limited profit or should be partially financed from public or private subsidies; the cost/rent of the dwelling should oscillate below market value but not necessarily below cost levels; the subsidies should be granted to households with a low or very low income (Dominiak 2005: 20) that are unable to satisfy their housing needs in the open market. Support from public resources is available at the stage of construction and exploitation of the flats (Muczyński 2011). The main responsibility for the delivery of social housing lies with municipalities and Social Housing Companies (TBS).

According to the European Commission [EC], there are two features that qualify housing resources for the social sector i.e. affordability and type of allocation (EC 2010). In line with the definition, the purpose of social housing is to deliver affordable housing resources to the market for sale, rent, allocation, maintenance and management. Managing such housing resources is no longer limited to technical and economic issues but also gains a social perspective.

The analysis of social housing concepts allows one to observe great heterogeneity in spatial terms. As international comparative studies prove, in many EU member states it covers both limited-profit housing and public housing stock. In others, it refers only to subsidised housing, still in some – it also covers the subsector of social rental dwellings with rent control. In most cases, social housing is delivered by municipalities, however, it is worth mentioning that there also appear new “non-specialised” providers – namely commercial developers (Harloe 1995; Hoekstra 2010; Suszyńska 2016; Habitat for Humanity 2015). These providers, in exchange for the benefits guaranteed by the public sector, temporarily devote their real-estate to social purposes in line with the principles regulating the public housing sector (rent control, tenants from waiting lists etc.). Businesses are encouraged to get involved in social housing through different types of grants, favourable fiscal treatment, as well as administrative and legal incentives. The effects of cooperation between the public and private sectors in the European Union are e.g. sharing land allocated for construction purposes, developing a common infrastructure network, making in-kind contributions of public land to commercial investments that combine both profit and non-profit goals (Suszyńska 2014).

The aim of the paper is to explore various models of housing allocation used by local governments in EU countries and identify new trends within the field. The specific goal is to scrutinise and evaluate the allocation system applied by the municipal housing company in the City of Poznań, Poland. In order to do so, the authors obtained data gathered on the basis of applications for social housing units, and information on housing contracts actually entered into. All the data was made available by ZKZL (the municipal housing company of the City of Poznań) and BSL (the housing department of Poznań City Hall).

Housing policy in the European Union

The changing position of social housing in EU countries has been discussed extensively in recent years. There are major differences between countries, but a number of trends occur in all of them. H. Priemus and F. Dieleman (1999) describe four common trends:

  1. lower levels of new construction of social housing;
  2. stagnation in the development of the market share of social housing;
  3. rising housing costs;
  4. concentration of lower income groups in some parts of the social housing stock.

In most European countries however, housing policy has undergone fundamental changes in recent decades. The policy focus has shifted from supply to demand and from government-dominated social housing to a more market-oriented approach.

Since the beginning of the 1980s housing policy has gone through decentralisation, privatisation and deregulation. Social housing policy has become more market-oriented in order to meet the expectations of the increasingly individualised preferences of consumers. The distribution model changed from a system based on needs to one based on consumers’ freedom of choice. This resulted in a new allocation system, appearing at the beginning of the 1990s, called Choice-based Letting (CBL) in Great Britain and the ‘Delft model’ in the Dutch social housing sector (Kullberg 1997). In this model, available properties are advertised in local or regional newspapers or on the Internet and customers can choose the dwelling they prefer but may apply only if they meet certain criteria. Many housing associations believed that the liveability of an area would improve if more house seekers were able to choose for themselves in which neighbourhood they wanted to live.

Social housing allocation models

In all member states there are housing regulations defining the framework of social housing, its beneficiaries and rules of construction funding. Among other things, detailed criteria are stipulated for accessing social dwellings. D. Czischke and A. Pittini (2007) distinguish between two allocation models: universalistic and targeted.

In the universalistic model of allocation, the housing sector is treated as the social responsibility of municipal housing organisations (e.g. in Sweden) or non-profit organisations (e.g. in the Netherlands). Social housing, should regulate the market via different tools (such as rent control) in order to provide the entire population access to affordable housing of an acceptable standard. The targeted system, on the other hand, is based on the assumption that the aims of housing policy will be met mainly by the market e.g. through adjusting supply to demand. Only those households that are unable to satisfy their housing needs in the open market can be the beneficiaries of the social housing stock. Due to the multitude of types and sizes of social housing sectors and related allocation criteria, D. Czischke and A. Pittini distinguish two sub-types of the targeted model: the targeted system with income-based allocation criteria and the targeted system in which the properties are allocated to the least-privileged social groups (Czischke & Pittini 2007).

Allocation criteria

In recent years we have been witnessing significant changes in the system of social housing allocation. The methods of ranking applications for social dwellings have been greatly modified. European experience demonstrates a general tendency in which the traditional allocation mechanism, based solely on the criterion of need, is replaced by a system that lets tenants exercise choice (though only to a limited extent). An example of the new approach is announcing unoccupied social flats in the press, which gives prospective tenants the chance to apply for a particular dwelling that addresses their needs. The issue of current changes in the social dwelling allocation procedure has been closely examined by I. Cole, B. Iqbal, L. Slocombe and T. Trott (2001). An innovative solution to the problem of social housing allocation, a sort of breakthrough solution, is the so-called Delft system, applied in most Dutch municipalities. The name of the system stems from the Dutch city of Delft, where the system was put into practice for the first time at the beginning of the 90s. At the end of the 90s it was also implemented in Great Britain in the form of allocation that takes into account tenants’ preferences. In Great Britain such a model is known as CBL (choice-based letting) (Haffner & Hoekstra 2006: 443). In line with the principles of the system, housing associations publish information about available social dwellings in the local press and on the dedicated web forums. In this way, an announcement can reach all prospective tenants registered on the waiting lists. All those interested in the announcement can visit the property and apply for it. If there is more than one applicant for a given property, the final tenant is selected on the basis of the ultimate criterion chosen for the property in question. Initially the candidates need to meet a range of basic criteria that enable them to register on the waiting list for a social dwelling. In the Netherlands, the final criterion of allocation is age (the oldest candidate has the advantage). Once the tenant has been selected, the information is published in the press and on the Internet. Every quarter a report listing the dwellings that have been allocated is published alongside information concerning the rented property: address, building type, area, number of rooms, etc. The report also contains the number of applicants and the qualifications of the ‘winner’ (his/her age, time spent on the waiting list, etc.). Such information gives candidates the possibility to self-assess their position and chances for a given type of social dwelling (Kullberg 2002: 551).

A priority-based model of dwelling allocation is based on defining specific social groups that are often referred to as socially vulnerable, e.g. handicapped, lonely parents, large families, seniors etc.

Another widely applied, though inefficient, model of social housing allocation is a waiting list. According to a recent study, in attractive areas, more than 50% of registered customers are not actively seeking a dwelling, but have registered anyway to avoid not being able to find a good property when the need arises. When candidates at the top of the list are offered a property, they often refuse the offer and choose to wait a little longer to find an even better opportunity. As a result, in Amsterdam, one of the most attractive and busy housing markets in the Netherlands, dwellings are offered on average six times before being accepted (Veer 2007). Other allocation criteria include:

  • Income – often connected to the first criterion. Usually, in the targeted model, an income threshold is defined;
  • Lottery – which gives groups such as young people and starters a greater chance of obtaining a property;
  • Experiments: ‘KAN experiment”, ‘Smart combinations’, Utrecht experiment and lifestyle as a post-selection criterion.

The first of the experiments is the ‘KAN experiment’, conducted in 2001 in the Netherlands. It abolished selection criteria with regard to income and household size. Residency or registration time criteria were used to rank applicants. As a result 70–80% of all house seekers experienced more freedom to choose their preferred dwelling. However, high-income households took more advantage of the experiment by renting cheaper properties than low-income households did by applying for more expensive ones.

Another Dutch experiment took place in Utrecht in 2004. This experiment aimed to improve the liveability of a neighbourhood by allocating several blocks of flats to house-seekers aged 25–55 years, with incomes above social security level. The positive effect on liveability was supposed to originate from the high degree of neighbourhood involvement and responsibility among these households. However, a two-year evaluation has not indicated any positive effects so far. The evaluation does indicate that since relatively better-off households are deliberately put into a privileged position, the low-income residents have less opportunity to find dwellings in this neighbourhood.

Several Dutch housing associations tried to introduce lifestyle as a post-selection criterion. In the POL model a housing association matched lifestyles and not real-life individual people to particular dwellings. Matches were based on a more or less intuitive idea of what constituted an ideal social mix. Customers chose a ‘model’ dwelling instead of a real dwelling in a real physical condition, with real neighbours in a real residential climate (van Daalen & van der Land 2008)

Social housing in Poland in 2016

The problems of the Polish housing sector have been defined in the strategic document „Main problems, targets and aims of housing development support for 2020”. The most urgent problems were defined as: low availability of properties due to insufficient supply, unsatisfactory standards of the available housing stock and low level of fulfilling the maintenance requirements of the stock (Sejm RP 2010).

Another important document that analyses the housing situation in Poland and verifies the paradigm of housing policy thus far is the National Housing Programme that was adopted by the Council of Ministers on February 16th, 2016 (MIiB 2016). It notes the fact that the statistical shortage of dwellings levelled out in 2012 and in 2015 there was a surplus of dwellings of approx. 120 thousand. It needs to be emphasized that the statistical shortage of dwellings is interpreted as a difference between the total number of dwellings and the number of households, whereas the statistical housing deficit is understood as the difference between the number of inhabited dwellings and the number of households. The latter (estimated at the level of 900 thousand) remains a problem (MIiB 2016).

It is difficult to estimate the size of the housing shortage in Poland because the quantitative data referring to the statistical housing deficit does not take into account substandard units. The number of substandard dwellings, assessed on the basis of data from the 2011 National Census (Główny Urząd Statystyczny 2013) amounts to more than 1.3 m (10.6% of the total number of dwellings). It is equally difficult to assess the scale of demand for social rental dwellings. The results obtained differ significantly depending on the methodology applied and measurement tools. The research conducted in 2014 by the Institute of Urban Development showed that the general demand for municipal dwellings in the cities was at the level of 300 thousand dwellings, including 175 thousand municipal dwellings and 125 thousand social ones (Instytut Rozwoju Miast 2015). In 2012 the Ministry of Transport, Construction and Marine Economy conducted a survey of 55 municipalities that brought results worth noting. The purpose of the analysis was to estimate the scale of demand for social dwellings and for dwellings with an indefinite rental period. The municipalities surveyed boasted a stock of almost 420 thousand dwellings (ca. 42% of the total municipal housing stock). The results showed that the number of households waiting for a dwelling from municipal resources was 24 thousand whereas the number of households waiting for a social dwelling amounted to 33 thousand (MTBiGM 2012).

Evidence from Poland: Poznań City

Before June 29th, 2016, in line with binding resolution no. XLVII/728/VI/2013 of March 26th, 2013 on the principles of allocating premises belonging to the City of Poznań’s housing stock (Rada Miasta Poznania 2013), the following criteria were taken into account in the analysis of applications for registration on a waiting list: income, size of the premises and certified residence within the city limits. For the time being, the detailed principles of allocating premises from the housing stock in Poznań city are defined in the City Council Resolution no. XXX/443/VII/2016 of June 7th, 2016 (Rada Miasta Poznania 2016). The main provisions of the Resolution define the criteria on the basis of which house-seekers apply for premises from the municipal stock or a social dwelling. To obtain a dwelling from the housing stock of Poznań city the applicants need to meet criteria based on income, certified residence within the city limits and minimum number of points – as defined by the President of Poznań – required for registration on the waiting list.

The income of the household that gives it the right to rent a municipal flat for an indefinite period of time cannot exceed:

  1. in a single-person household: 225% of the minimum monthly pension (according to data from December 2016: ca.1 981 PLN) as of January 1st of the year in which the waiting list is being drawn or as of January 1st of the year in which the rental contract is signed;
  2. in a multi-person household respectively: 175% of the value above (ca. 1540 PLN).

In the case of applicants for a social dwelling, the value of the average monthly income, earned within 12 months prior to the year in which the social waiting list is drawn up or the year in which the rental contact is signed, should not exceed:

  1. 125% of the minimum monthly pension (1 100.56 PLN) per person in a multi-person household;
  2. 175% of such amount (1 540.79 PLN) in a single-person household; the income is calculated on the basis of the average gross income of the household, without social security premiums, in the last three months prior to the date of submitting the application.

Eligibility to apply for a dwelling from the housing stock of the City of Poznań is restricted to citizens of Poznań (certified address within the city limits required) especially for those leaving foster care institutions, people with disabilities, seniors over 70 years of age, large families, and people affected by domestic violence. Rental contracts for social premises can be signed with people whose income level entitles them to a social dwelling and who have been enrolled on the social waiting list or with those whose previous agreement terminated but the income of their household still entitles them to such premises. The resolution also specifies the conditions of renting municipal or social premises for those not on the waiting lists (e.g. people who have the right to premises stemming from a judicial decision or those who lost their dwelling as a result of a natural disaster, catastrophe or fire).

In line with the resolution, the annual waiting lists of those entitled to a municipal/social dwelling can be drawn up by the president of the city who subsequently passes them on to the Lists Assessment Committee (a unit of social control over procedures of tenancy applications handling and examination). The lists are prepared on the basis of a points-based system that takes into account the priority status of particular applicants.

In cases where there is an equal number of points without any defined priority for either applicant, the above mentioned Committee makes a final decision on the basis of a draw. Applicants who are entitled to a municipal/social dwelling on the basis of the annual list from the previous year and whose entitlement has not been satisfied in a given year are placed at the head of the list for the following year. Additionally, the president, once she/he obtains a positive opinion from the List Assessment Committee, has the right to add to the lists those in urgent need of housing support.

The total housing stock in the City of Poznań is approx. 12 400 housing units. In 2012–2016 the formal demand for municipal dwellings in Poznań (measured by the total number of applications) was gradually increasing – and achieved a peak in 2016 (898 applications). In 2017, the number of applications filed increased to 966, yet the number of contracts entered was unknown at the time of the paper’s preparation. At the same time, the number of applications meeting the criteria declined as a result of changes in the allocation principles. In 2012–2016 the number of municipal dwellings decreased due to a lower number of housing units repossessed as a result of natural migration which had been declining since 2013. Another reason for the decrease was a lack of construction of new premises (in 2014 and 2015 no new social housing units were delivered). If we compare the number of applications that meet the criteria and the number of contracts signed, we can conclude that the level to which the demand for municipal dwellings was satisfied – resulting from the principles adopted for allocating housing support in the City of Poznań – was insufficient in all the years under analysis. The very large number of applications for municipal/social dwellings versus the number of contracts signed proves that the local criteria for granting housing support in Poznań are very strict. Applications for a social dwelling that met the local allocation criteria constituted a large majority in the total pool of applications for the allocation of a housing unit from the city stock that fulfilled the criteria. In 2012 as many as 88% of applications concerned the allocation of a social dwelling. In 2014 the allocation of a social dwelling was the subject of only 54% of applications.

If we compare the number of applications that meet the criteria and the number of contracts signed, we can conclude that the level of satisfaction of the demand for municipal dwellings – resulting from the principles for allocating housing support adopted in the City of Poznań in 2012–2016 – was insufficient. However, it must be noted that the ratio of contracts ready to be signed versus the total number of families that meet the criteria does not vary from the average of other cities – the last available estimate on satisfying local housing needs in Poland is 40–50% (Korniłowicz 2005).

Conclusions

The main problems of the Polish housing sector are: low availability of housing due to insufficient supply, unsatisfactory standards in the available stock and low quality of maintenance. In terms of social housing, the sector is particularly vulnerable due to the extensive privatisation that was mainly conducted up to 1990s, and ineffective use of the remaining units. On the basis of the example of the City of Poznań, one can observe that there is a big gap between the number of applications for social rental dwellings and the number of housing contracts actually entered into. This may prove the fact that allocation procedures in Poznań are too rigid. On the other hand, it is not easy to propose an effective solution in the light of an acute shortage of social housing. Furthermore, housing allocation in Poznań (and other Polish municipalities) does not allow consumer choice and thus it can neither be denoted consumer-friendly nor innovative. However, while it is true to say that the City of Poznań fails to meet numerous households’ needs, the proportion of applications accepted for the presidential list of those meeting the allocation criteria is similar to other Polish cities.

The European experience shows that the general tendency is to replace the traditional allocation mechanism based solely on the criteria of income and needs with one incorporating (though to a limited extent) the preferences of potential tenants. However, the process is hardly visible in the case of Poland. Local municipalities, although aware of the general allocation trends in the most developed housing systems, are reluctant to empower tenants. Moreover, the changes are greatly restricted by the meagre size of the social housing stock in relation to the housing needs expressed.

References

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  • Cole I. Iqbal B. Slocombe L. & Trott T. (2001) Social engineering or customer choice? Rethinking housing allocations Chartered Institute of Housing Coventry.

  • Czischke D. & Pittini A. (2007) Housing Europe 2007. Review of socialco-operative and public housing in the 27 EU member states CECODHAS Housing Europe Observatory Brussels.

  • Daalen van G. & Land van der M. (2008) Next Steps in Choice-based Letting in the Dutch Social Housing Sector’ European Journal of Housing Policy 8 (3) 317–328. .

    • Crossref
    • Export Citation
  • Dominiak W. (2005) Realizacja społecznych celów mieszkalnictwa w krajach Unii Europejskiej. Implikacje dla Polski [in:]: L. Frąckiewicz ed. Przeszłość i przyszłość polskiej polityki mieszkaniowej IPiSS Warsaw 18–45 [in Polish].

  • European Commission (2010) Europe 2020. A strategy for smartsustainable and inclusive growth. Communication from the Commission Brussels.

  • Główny Urząd Statystyczny (2013) MieszkaniaNarodowy Spis Powszechny Ludności i Mieszkań 2011 Warsaw. Available from: http://stat.gov.pl/spisy-powszechne/nsp-2011/nsp-2011-wyniki/mieszkania-narodowy-spis-powszechny-ludnosci-i-mieszkan-2011,18,1.html [accessed: 5.04.2018] [in Polish].

  • Habitat for Humanity Poland (2015) Raport: Mieszkalnictwo w Polsce. Analiza wybranych obszarów polityki mieszkaniowej Warsaw [in Polish].

  • Haffner M. & Hoekstra J. (2006) Housing allocation and freedom of movement: a European comparison Journal of Economic and Social Geography 97 (4) 443–451.

  • Harloe M. (1995) The People’s Home: social rented housing in Europe and America Blackwell Oxford.

  • Hoekstra J. (2010) Divergence in European welfare and housing systems Delft University of Technology Delft.

  • Instytut Rozwoju Miast (2015) Informacje o mieszkalnictwie. Wyniki monitoringu za 2014 r. Krakow [in Polish].

  • Korniłowicz J. (2005) Wybrane elementy polityki mieszkaniowej Problemy Rozwoju Miast 4 48–53 [in Polish].

  • Kullberg J. (1997) From waiting list to adverts: the allocation of social rented dwellings in the Netherlands Housing Studies 12 393–403.

    • Crossref
    • Export Citation
  • Kullberg J. (2002) Consumer’s responses to choice based letting mechanism Housing Studies 17 549–579.

    • Crossref
    • Export Citation
  • Ministerstwo Infrastruktury i Budownictwa (MIiB) (2016) Narodowy Program Mieszkaniowy Załącznik do Uchwały nr 115/2016 Rady Ministrów z dnia 27 września 2016 r. w sprawie przyjęcia Narodowego Programu Mieszkaniowego Kancelaria Prezesa Rady Ministrów Warsaw [in Polish].

  • Ministerstwo Transportu Budownictwa i Gospodarki Morskiej (MTBiGM) (2012) unpublished survey conducted by the Ministry of Transport Construction and Management of Marine Areas of the Repubolic of Poland among municipal authorities.

  • Muczyński A. (2011) Gospodarowanie gminnymi zasobami lokalowymi z perspektywy polityki mieszkaniowej Studia i Materialy Towarzystwa Naukowego Nieruchomości 19 (2) 7–25 [in Polish].

  • Muzioł-Węcławowicz A. (2012) Zapotrzebowanie na społeczne mieszkania czynszowe w Polsce w 2012 r. Warsaw [in Polish].

  • Muzioł-Węcławowicz A. (2015) Problemy mieszkaniowe Polaków a polska polityka mieszkaniowa [in]: M. Salamon M. & A. Muzioł-Węcławowicz eds. Mieszkalnictwo w Polsce. Analiza wybranych obszarów polityki mieszkaniowej Habitat for Humanity Poland Warsaw 10–90 [in Polish].

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