CEO’s review

2017 was an international year for us. Interest in Finland’s Housing First model and Y-Foundation’s operations had at times even reached confusing proportions in the form of foreign visitors and interview and lecture requests. The unique nature of Finland’s model has become apparent in international interaction.

It is based not only on the application of the Housing First principle, but also a comprehensive integrated strategy implemented as an extensive partnership between the state, municipalities and NGOs. This operating model includes significant social capital that we cannot afford to waste in the quagmire of any administrative reform.

In particular, the uncertainty of the Finnish operating environment resulting from the health and social services reform has only increased the need for cooperation and partnership. Y-Foundation actively seeks partners sharing the same objectives and values, regardless of whether eliminating homelessness or increasing the supply of affordable rental housing is concerned.

An example of a new cooperation endeavour is the cooperation agreement signed with several trade unions, aiming for significant new construction of affordable rental housing with 10-year interest subsidised financing.

The international interaction has also concretely proven the central importance of affordable rental apartments in reducing homelessness. In several European countries, the United Kingdom and Ireland in particular, outright street homelessness has exploded, and the key reason for the development is the inadequate supply of affordable rental apartments, caused by both insufficient new construction and sale of apartments in the open market.

It seems that the market will resolve neither homelessness nor the sufficient supply of affordable rental housing. It is illustrative of the situation that even many US cities are looking for fiscal solutions to significantly increase the number of affordable rental apartments.

Homelessness and the amount of affordable rental housing are connected

The connection between homelessness and the supply of affordable rental apartments shows that Y-Foundation’s strategic aim of significant new construction of affordable rental apartments is also important for carrying out the Foundation’s basic task, eliminating homelessness.

In spite of favourable talks, new construction of affordable rental housing is proceeding sluggishly and the quantitative production objectives were not met during the year.

Key reasons for the problems with starting new construction include the scant supply of plots and delays due to actions of the authorities. Y-Foundation has the resources for investing significantly in rental housing production, including financially and, for our own part, we want to ensure that not a single ARA plot in growth centres remains unbuilt due to the lack of developers.

The year 2017 was also the first year of operation for Y-Foundation after major housing deals and related operational changes. Internally, the year therefore provided an opportunity to take significant steps in developing the processes and introduction of ERP systems.

In addition to the continuous development of its own operations, the Foundation also specifically invested in employment-related experiments. Experiments in employment and conceptual development of new construction as well as research activities supporting them will continue to be the Foundation’s key focal areas in the future as well.

With regard to the Foundation’s basic task, i.e. eliminating homelessness, the development has continued to be favourable and homelessness has decreased, but there still remains work to be done. The favourable development proves that the work done has been significant and effective. Both our motivated employees who are committed to the Foundation’s values and our unique partner network are to thank for that.

Juha Kaakinen, CEO