Verkhovna Rada Passed a New Housing Policy Law: What Does It Mean?

On January 13, the Verkhovna Rada of Ukraine adopted the draft law No. 12377, On the Basic Principles of Housing Policy. This is an important step, as it replaces outdated laws (such as the 1984 Housing Code of the Ukrainian Soviet Socialist Republic and the 1992 Law of Ukraine On Privatization of State Housing Fund) and changes the state’s approach to housing policy.

The newly adopted document aims to create a system that puts people, their needs, and practical tools for ensuring access to housing at its core.

In the context of full-scale war and widespread population displacement, this law is of crucial importance. It introduces a new comprehensive approach to housing policy: from the creation and accounting of housing stock to its distribution and use. It also clearly defines the role of the state in this area and provides modern mechanisms of housing accessibility.

These new mechanisms include:

• The creation of a rental program for affordable social housing, which includes the possibility of state compensation for up to 100% of the rent, depending on social status, income levels, and the individual or family’s property situation.
  
• The establishment of housing funds for affordable rental housing, which cannot be privatized or sold.
  
• The introduction of two new housing models, namely affordable and social. Affordable housing will be available for those on the waiting list for improved living conditions, allowing them to purchase it on preferential terms using the tools provided by the new law. Social housing will be available for temporary use under what is known as “social rent” conditions.
  
• Rent-to-own. After ten years of renting, individuals can purchase the property, but this option will be available only once. The payments made by tenants during this period will be directed to a special revolving fund, which will be used to build new social housing. Payments for the aforementioned social rent, which will be calculated separately for each family, will also go into this special fund.
  
• The introduction of affordable housing operators. These will be companies that build and manage affordable housing. There will be two types of operators: a social housing operator (municipal non-profit organization supporting vulnerable groups) and an affordable housing operator (businesses offering rent-to-own or outright sale). To make housing truly affordable, the law provides tools for reducing its cost: hromadas may allocate the land for construction free of charge, offer low-interest loans, or provide guarantees to attract such loans.
  
• The encouragement of investment and cooperation between the state and businesses in the housing sector.
  
• The digitalization of housing policy processes. This will ensure that everyone can quickly and transparently use state instruments for renting, building or owning a home. Digitalization will make any corrupt practices impossible. A unified information and analytical system will be created, which will, firstly, digitize all housing waiting lists and, secondly, function as a single digital hub that will consolidate all data in one place and automatically interact with other state registers. Citizens will be able to see their status, receive offers, and use open information about affordable housing programs and funds.

The law places a special emphasis on displaced persons (IDPs) and other vulnerable groups. In particular, it grants the right of free housing to people whose homes have become uninhabitable as a result of emergencies. At the same time, receiving temporary housing does not deprive them of their right to use other mechanisms of state support.

Recently, East SOS prepared a brief overview of the housing voucher program for internally displaced persons.