The Student Village Foundation of Turku will not raise the rent for its apartments on January 1, 2018. Rents for certain housing types will even be corrected so that they are slightly lower and more competitive. The tenants of these apartments will be informed separately.
Due to the very low interest rate levels, significant savings are estimated to be achieved in the Foundation’s interest expenses. This will allow for abandonment of rent increases and also an additional loan repayment of approximately one million euros in accordance with the strategy.
The Foundation’s economy is directly dependent on the occupancy rate of rental housing. The target is set at a 97% economic rate, which is about two percent higher than a few years ago. This also affects the need for a revision of rents.
The total income budget for the Foundation in 2018 is € 26.6 million. Housing prices account for 97% of income. The remainder includes other rental income (eg parking space and commercial space), usage fees (eg furniture and laundry fees) and other income (eg office fees).
The largest single item of maintenance expenditures (€ 18.1 million) are repairs (€ 5.4 million). Less than half of the total budget is used for apartment repairs.
Housing rents in TYS are 15-20% cheaper than similar residential properties with the same terms on the private market. The Foundation’s rental now includes electricity, water and internet access.
Over the past few years, the Student Village Foundation of Turku has been investigating a possible transition to consumer-based electricity and water billing. A questionnaire on tenant satisfaction is sent out each spring, this year we also asked our residents opinion on consumer-based billing. 78% of respondents would like electricity and water to be included in the rent also in the future. The Foundation’s Board of Directors has ruled that a transition to consumer-based electricity and water billing will be addressed again in connection with the preparation of the 2019 budget.
There are a total of € 7 million of loan repayments and € 1.2 million of interest expenses are budgeted.
In addition to financing and good expenditure on property management, rents can be used to raise funds for upgrading, maintenance and care fees for the future. Preparing for these expenditures can affect the steady development of rents. In 2018, the amount of the provision will be 0.7 M €.
Housing rents are determined on a per-cost basis in accordance with ARA guidelines and regulations. In accordance with the act on joint management in rented housing, also the resident commissions have had the opportunity to issue an opinion on the budget.