The Price-Dampening Effect of Non-profit Housing

The study examines the price-dampening effect of non-profit building associations (GBV) on the for-profit housing segment. The focus is on rental housing. In addition to a conceptual classification of GBV as a non-profit provider of the housing sector, hypotheses for the effect of GBV are derived on the basis of an oligopoly model. In the empirical part of the study, the milestones of the Austrian housing industry of the last 50 years are first outlined and then the housing construction cycles of the last decades are elaborated. The behaviour of the different provider segments in terms of price and quality is also mapped on the basis of a long time series of the microcensus. This is followed by a presentation of the regional disparities of GBV activities. A final statistical analysis quantifies the price-dampening effect of GBV using econometric methods. Depending on the model, an increase in the GBV share of 10 percent leads to a decrease in the differential of 30 to 40 cents per m2. However, the increase in the GBV share shows a stronger effect in regions where GBV already have a substantial presence.