Eradicating Homelessness in Finland

Parker Lester, Social Science Analyst

As part of Finland's commitment to the Housing First approach, the government converted homeless shelters into housing units to create new housing stock with supportive services.

In the latter years of the 2010s, the nation of Finland positioned itself as a global leader in combating homelessness. Through an innovative public policy strategy that has virtually eliminated homelessness within its borders, Finland has redefined how nations can address homelessness. By focusing on prevention, early intervention, and a comprehensive support system through wraparound services, Finland has shown the world that homelessness is a solvable problem.

A 2020 article in Cityscape: A Journal of Policy Development and Research, written by Marybeth Shinn and Jill Khadduri, states that until the 1990s, Finland used the “staircase” or “treatment first” approach to addressing homelessness, which entails providing housing to individuals only after they have been treated for mental illnesses, drug abuse, or other ailments. The article cites research suggesting that the staircase model “can work well with those who have opted for substance abuse rehabilitation and can cope with shared housing. However, the insistence on service users being intoxicant-free and able to take control of their lives has proven to be an insuperable barrier for many homeless people with multiple problems.”

Housing First Approach

Between 2004 and 2008, the number of single homeless individuals in Finland hovered between 7,400 and 7,960 after having been nearly halved during the previous decade. By 2008, Finnish policymakers realized that the staircase approach had reached its maximum effectiveness, and a new strategy was needed to further reduce Finland’s rates of homelessness. Shinn and Khadduri cite Finnish experts at the Y-Foundation, Finland’s largest nonprofit landlord, who concluded that the staircase approach “requires adopting the Housing First principle where a person does not have to first change their life around in order to earn the basic right to housing. Instead, housing is the prerequisite that allows other problems to be solved.”

Finland began to prioritize the Housing First approach, providing housing immediately and without preconditions to residents in need. The underlying principle of Housing First is that having a stable and secure home is a fundamental human right and a critical foundation for tackling other issues contributing to homelessness, such as mental health issues or substance abuse. By prioritizing housing as the first step in addressing homelessness, Finland’s government successfully created a supportive environment for individuals to address other challenges. According to the Finnish experts Shinn and Khadduri cite, “In the Housing First model, a dwelling is not a reward that a homeless person receives once their life is back on track. Instead, a dwelling is the foundation on which the rest of life is put back together.” They further state, “A person who is homeless goes directly into a rental apartment, either an independent apartment or a unit in a supported housing development and has the opportunity to choose services and supports. Staff in supported housing developments treat clients as equals and strive to build community.”

As part of Finland’s commitment to the Housing First approach, the government converted homeless shelters into housing units to create new housing stock with supportive services. Shinn and Khadduri cite Y-Foundation research finding that the number of shelter and hostel beds in Helsinki fell from 2,121 in 1985 to 52 in 2016. During the same period, the number of supportive housing units in the city grew from 127 to 1,309, and independent rental apartments for people formerly experiencing homelessness increased from 65 to 2,433.

Part of the country’s focus is on scattered sites, meaning that Finland’s government distributed public housing in sites throughout the city to encourage members of lower economic classes to mix with more affluent residents. This policy was a key to successfully keeping Finnish people who were experiencing homelessness off the street, because residents could be placed in safer neighborhoods that were closer to employment centers.

Applicability in the United States

When examining what lessons the United States could derive from Finland’s experience, scholars must consider the considerably different sizes of the two nations. According to the World Bank, Finland had an estimated total population of approximately 5,541,000 — considerably smaller than that of New York City, at 8,622,000. The United States had an estimated population of approximately 331,900,000 in 2021. Despite the population disparity, Shinn and Khadduri present evidence indicating that it is not the size of the United States that prevents it from eradicating homelessness. Rather, they argue, Finland’s social programs are simply “more effective at reducing poverty.” The authors cite research stating that, in terms of market income, Finland has a slightly higher poverty rate than the United States, at 32.4 percent and 31.2 percent, respectively. After accounting for social programs, however, the authors point out that “16.2 percent of Americans are below [the] relative poverty line, compared to 7.2 percent of Finns.”

Researchers should also note that, according to World Habitat, the city government of Helsinki owns 70 percent of the land in the city, simplifying the process of creating a large public housing system. Local governments in the United States that are grappling with homelessness, on the other hand, must work in tandem with private partners who own the land where affordable housing can be built or the structures that can be converted to affordable units. However, Finland's homelessness strategy also relies on close collaboration among various stakeholders, including government agencies, municipalities, nongovernmental organizations, and housing providers. By sharing expertise, resources, and best practices, Finland has created a unified and streamlined approach to tackling homelessness. This collective effort has been vital to the strategy's success and its ability to adapt to changing social and economic conditions in urban areas.

Shinn and Khadduri point to the success of the HUD-Veterans Affairs Supportive Housing program as an example of an effective implementation of the Housing First approach in the United States. The program, which is designed to house veterans experiencing homelessness, has contributed to an 11 percent decline in homelessness rates among U.S. veterans since early 2020 (based on a 2022 Point-in-Time Count). Specifically, data show that on a single night in January 2022, a total of 33,136 veterans were experiencing homelessness in the United States, down from 37,252 in 2020. This decline represents a 55.3 percent reduction in the number of veterans experiencing homelessness since 2010.

Conclusion

By prioritizing the Housing First approach, instituting a comprehensive system of collaboration, and harnessing private and political will to eradicate homelessness, Finland has achieved notable success at effectively addressing homelessness. As countries worldwide grapple with their own homelessness challenges, the Finnish strategy offers valuable lessons and a roadmap for other nations striving to reduce rates of homelessness.

You can find the Cityscape report here: Cityscape: A Journal of Policy Development and Research - Two Essays on Unequal Growth in Housing - How Finland Ended Homelessness (huduser.gov)