The crisis of public housing in Sweden—Economic reality or organizational myth?

Abstract

The late seventies and early eighties are regarded as a period of economic crisis in Swedish public housing. This notion is discussed in terms of objective and subjective crisis. The economic development of the aggregate of municipal housing companies (MHCs) is analyzed over the period 1971–87 by means of a number of economic ratios. No evidence of objective economic crisis is found. The subjective crisis was seemingly triggered by market and political change, and later subjective recovery was the effect of internal organizational change. It is claimed that the economically stable conditions of public housing make economic crisis—unless politically initiated—unlikely. On the other hand the rent negotiation system and the accounting practices of MHCs will give evidence of economic crisis at any time. Moreover, a cycle of subjective crisis and recovery may be the effect of intrinsic myths and mechanisms of non‐profit housing in general.