Grants for rental housing support the creation of affordable rental flats, most often owned by municipalities. A characteristic feature is the combination of two instruments: a non-repayable grant for part of the acquisition cost, and a favourable long-term loan for the rest, possibly supplemented by support for the technical infrastructure to the flats, that is, access roads, water supply and sewerage. Flats acquired with such support are tied to rental housing use for a set period, have a regulated rent level and allocation rules that the municipality cannot bypass. Selling a flat during the tie-in period is not possible without repaying the support. For the municipality it is therefore essential to plan for long-term management of the housing stock, including maintenance and rent collection, not just for construction. Likewise, calculate in advance whether the regulated rent will cover the loan instalments, maintenance and the building-up of a repair fund for the entire tie-in period.
See also: State Housing Development Fund (ŠFRB), Grants for Municipalities and Towns, Financial instruments.
