Thousands of empty plots of land wait for prices to rise

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The Helsinki region has enough unbuilt residential land to provide homes for about 150,0000 residents.
      In early February, the land registry of the Helsinki Metropolitan Area Council (YTV) showed that there was space for the construction of about two million square metres of living space in areas zoned for multi-storey residential buildings, and four million square metres of space for single-family units.
      If each resident is calculated to need about 40 square metres of living space, this means that the unbuilt land could house 150,000 new residents without needing to go through a new zoning process.
      Most of the empty residential land is in Espoo and Vantaa.
      There are two kinds of properties - ones that are completely without any buildings, and others, where additional construction is possible.
     
YTV planner Arja Salmi says that owners of the empty land include the state, municipalities, construction companies, and private individuals.
      "For instance, construction companies often own land on behalf of housing associations that are to be set up. It is fairly impossible for us to figure out who is in control of each individual plot of land", Salmi says.
     
One reason for leaving the land unbuilt is that the owners are waiting for property values to rise.
      As long as the price of land goes up ten per cent a year, and as long as the property tax on empty land is less than two per cent, the benefit brought by rising prices is greater than the cost of the tax.
      As long as there is no immediate need for cash, it is calculated that it is better not build or sell.
      Builders also examine the market situation when they decide on how much to build. If all available land were to be suddenly built full of houses and apartments, real estate prices would come down.


Previously in HS International Edition:
  Proposal calls for Sipoo to hand over less land than planned to Helsinki (1.12.2006)

Helsingin Sanomat