15th Annual Meeting of the Network on Fiscal Relations Across Levels of Government, OECD, 2-3 December 2019

1. Comment on:
Decentralisation and Governance in
the Housing Sector
Abel Schumann
CFE/ESG

2. The housing spectrum is diverse
Emergency
and shelter
spaces
Supported
housing
Social
housing
(non-market
rental)
Subsidised
housing
Private
market
rental
Home
ownership
Temporary Permanent
Market
Higher incomeLowerincome
Non-market

3. 0
2
4
6
8
10
12
0 1 2 3 4 5 6 7 8
Number
of
countries
Number of ministries involved in housing policy
Housing policies create important multi-level
governance challenges
%
10%
20%
30%
40%
50%
60%
70%
80%
90%
1996 2006 2016
Share of subnational spending

4. %
10%
20%
30%
40%
50%
60%
National/federal National specialised
agency
Regional/state Local/municipal Housing
provider(non-govt)
Tenant cooperative Other
Actors responsible for setting policy priorities
for social housing
% of countries

5. Responsibilities on social housing by level of
government
0 20 40 60 80 100
National/federal
National specialised
agency
Regional/state
Local/municipal
Housing providers (non-
govt)
Tenant cooperative
Other
Deciding levels and rates of property taxes on private residences (e.g.
transfer duties, land rates)
Designing and implementing a scale for contributions by users of
social housing
Setting overall budget for social housing
0 20 40 60
National/federal
National specialised agency
Regional/state
Local/municipal
Housing provider(non-govt)
Tenant cooperative
Other
Hiring and firing of staff involved in the construction
of social housing (e.g. construction workers,
architects)
Determining working conditions of staff involved in
the construction of social housing (e.g. construction
workers, architects)
Determining which social housing services can be
outsourced (services obtained from outside
providers, such as cleaning)
0 10 20 30 40 50 60
National/federal
National specialised agency
Regional/state
Local/municipal
Housing provider(non-govt)
Tenant cooperative
Other
Opening/closing of social housing
Selecting users of social housing
Selecting the placement of users of social housing
Determining the processes to apply for social housing
% of
respondents
Budgeting decisions Input decisions Output decisions
% of
respondents
% of
respondents

6. Land-use planning plays a key role for housing
• Land-use planning and zoning
determining housing supply
• Land-use planning and zoning
generally the responsibility of local
governments
• 10% of U.S. housing is more than twice as
expensive due to land-use restrictions in
housing supply (Glaeser & Gyourko, 2017).
• Land-use regulations in England increase
average house prices by GBP 79,000 (Hilber &
Vermeulen, 2016).
• Land-use regulations preventing the growth of
the most productive cities in the U.S. reduce
GDP by 9.5% (Hsieh & Moretti, 2015).
• Germany built just 32% of the needed housing
units since 2011 in cities, but 40% more
single-family homes than needed in rural
areas, creating sprawl and risking future
abandonment (Deschermeier et al., 2017).

7. Fiscal incentives matter for zoning decisions
by local governments
• Local governments use zoning regulations to steer housing
development within their jurisdictions
New housing development creates more
costs than revenues for local governments
Local governments do not permit
sufficient housing development, leading
to rising housing costs
Local governments obtain a
disproportionate share of revenues from
local business taxes
Local governments have an incentive to
zone excessive amounts of land for
commercial development

8. Thank you!
Contact: abel.schumann@oecd.org