Can Public Housing Truly Be Innovative? Lessons from Vienna to Reimagine the Future of Local Governance

Abstract

This article examines Vienna’s public housing model as an exemplary case of institutional innovation in the public sector, defined by its regulatory stability, universalist orientation, and resistance to the commodification of urban land. Through a thematic analysis of scientific sources indexed in Scopus and official documents from the City of Vienna and the Austrian legislative framework, the study identifies both the achievements and the structural tensions within the system. The findings reveal a form of slow innovation grounded in the capacity to integrate new agendas—such as social and environmental sustainability or collaborative modes of living—into an already consolidated regulatory framework. However, grey areas persist, particularly with regard to the exclusion of vulnerable groups, community fragmentation, and the limited replicability of alternative models. The study contributes to expanding the concept of innovation in public administration beyond technocratic approaches, highlighting the value of adaptive institutionalism.

1. Introduction

In the contemporary context of growing social, economic, and environmental challenges, innovation in the public sector has become a strategic priority for both governments and researchers. There is a pressing need for a broad and situated understanding of public-sector innovation strategies that go beyond traditional technocratic or efficiency-focused approaches. One area in which this need is particularly urgent—though often underestimated—is housing policy. Housing is not only a basic consumer good and a social right; it is also a field of contention over how the state structures welfare provision, regulates markets, and shapes urban life. Thus, innovation in housing entails transforming technical mechanisms of provision and rethinking forms of governance, social inclusion, and spatial justice that underpin housing models.

The recent literature has begun to document a variety of public-sector innovations in the housing field, with emphasis on how local governments have designed integrated strategies to promote the inclusion of vulnerable populations. Frątczak-Müller (2022), for example, highlights that housing policies combined with social support and community participation can significantly improve levels of social inclusion in urban contexts over a relatively short period. Similarly, Nzau and Trillo (2020) underscore the potential of tools such as land value capture and inclusionary housing to generate affordable housing units in neighbourhoods undergoing regeneration, thereby preventing gentrification and displacement. Decentralisation of decision-making power and the strengthening of municipal capacities also emerge as enabling conditions for innovation, as they allow the development of participatory housing plans tailored to local contexts (Ferreira Costa, 2020; F. Vergara-Perucich, 2021; J. F. Vergara-Perucich & Boano, 2019). In this regard, co-creation and participatory service design—as argued by Eseonu (2022)—constitute emerging forms of social innovation that involve marginalised groups as active agents in the formulation and delivery of public policies (Arias-Loyola & Vergara-Perucich, 2021).

Salim and Drenth (2020) in turn emphasise how cities that adopt approaches grounded in cross-sector partnerships, community empowerment, and smart city concepts can develop more inclusive and resilient housing models (Alvarez de Andres et al., 2019; Boano & Vergara-Perucich, 2016; Carrasco & O’Brien, 2021; Jones, 2017). The positive impacts of such initiatives are not limited to the housing domain: recent studies show correlated improvements in health, education, and overall wellbeing, particularly among vulnerable groups such as female-headed households, older people and migrants (Adetola et al., 2024; Bonhomme, 2021; Contreras et al., 2019; Contreras Gatica & Seguel Calderón, 2023). As such, housing policy innovation must not be understood merely as a technical enhancement in construction or distribution, but rather as a complex field in which public strategies aim to redefine the urban social contract.

Within this framework, the present article offers an empirical and analytical contribution to the study of public-sector innovation in housing by critically examining the case of Vienna, Austria. Far from being merely a successful anomaly in the European context, the Viennese model represents a deeply stable institutional infrastructure, which has managed to preserve and renew a large-scale, affordable, and structurally inclusive system of public housing. Vienna has consistently ranked among the top cities in international quality of life indices, such as the Economist Intelligence Unit’s Global Liveability Index (Economist Intelligence Unit, 2024; Khomenko et al., 2020). However, this image of urban excellence must be critically qualified and examined. Several studies have pointed out that, despite its high scores, the city faces significant challenges: for example, 8% of premature mortality in Vienna is attributable to exposure to environmental factors exceeding recommended levels, revealing the gap between global evaluation metrics and the actual living conditions—or even the subjective experience—of residents in what is often considered the best city in the world to live in.

The critical literature has also questioned the methodological assumptions of these rankings, arguing that they are often designed for a global elite and tend to obscure the dimension of housing affordability (Cramer-Greenbaum, 2021). This methodological exclusion is particularly problematic in the context of growing financialisation of urban land, where many cities with high liveability rankings simultaneously display severe housing cost burdens for a significant share of their population (Aalbers, 2012; Rolnik, 2013). In Vienna’s case, this bias is troubling, particularly given that intra-urban inequalities have intensified and that lower-income groups face higher levels of environmental risk and difficulties in accessing protected segments of the housing stock.

For all these reasons, the Viennese model provides fertile ground not only for validating best practices but also for identifying limitations, contradictions, and opportunities for innovation from within a paradigmatic case. Vienna is selected not only for its exemplary status, having maintained a large-scale, affordable public housing system for decades, but also because its underlying principles offer transferable insights. Core elements such as long-term strategic planning, stable legal frameworks, and institutional resilience against full market commodification provide valuable, adaptable lessons for other cities striving for housing equity, even when considering Vienna’s specific socio-historical context.

Unlike other approaches that equate innovation with technological disruption or digital governance, this study focuses on what could be termed “slow institutional innovation”. This concept is characterised by historical accumulation, a deliberate resistance to market logics, and the gradual, purposeful incorporation of social and environmental reforms. This distinguishes it from the more deterministic trajectory implied by path dependency, or the potentially aimless adjustments of simple incrementalism, by emphasising an intentional evolution rooted in established values. Specifically, the article examines how Vienna’s housing model has adopted ecological transition strategies, anti-financialisation mechanisms, and emerging forms of urban co-production—such as housing commons—without abandoning its public ethos. This form of innovation is not grounded in novelty per se, but in the institutional capacity to strategically integrate new agendas without undermining core normative foundations. It is this strong normative anchoring and the selective integration of change to preserve its foundational ethos, rather than a primary focus on rapid flexibility or responsiveness for its own sake (as often emphasised in adaptive governance), that defines its unique character.

This study seeks to answer the following primary research question: How does the Vienna public housing model, conceptualised as a form of institutional innovation, manage to integrate new agendas—such as social and environmental sustainability or collaborative living—into its historically consolidated regulatory framework, and what are the key achievements and inherent structural tensions that characterise this adaptive process? To answer this question, the study pursues three main aims: (1) To critically examine Vienna’s public housing model through the lens of ‘slow institutional innovation,’ focusing on its historical capacity for adapting and integrating new agendas while resisting full marketization. (2) To identify and analyse the specific mechanisms and policy instruments that underpin this model’s stability, its universalist orientation, and its approach to incorporating contemporary challenges like social and environmental sustainability. (3) To evaluate the resulting achievements in terms of housing affordability and quality, alongside an assessment of the structural tensions, including issues of social exclusion, community fragmentation, and the model’s replicability. Consequently, this article seeks to contribute by (a) empirically grounding and expanding the concept of ‘slow institutional innovation’ within public administration and urban studies; (b) providing a nuanced, evidence-based analysis of a paradigmatic public housing system, highlighting lessons from both its successes and limitations; and (c) offering insights for policymakers on developing resilient and inclusive urban housing strategies that value long-term institutional capacity over purely disruptive approaches.

Furthermore, the article engages with the broad body of literature on housing innovation in local government, particularly in European contexts, where persistent barriers—such as outdated regulatory frameworks, budgetary constraints, and limited technical capacities—have been widely documented, alongside promising implementation approaches (Batra, 2021; Gurran, 2003; Hacke et al., 2019; Morphet & Clifford, 2021). The Viennese experience shows how some of these barriers can be mitigated through long-term strategic planning, stable legal frameworks, and an institutional architecture capable of sustaining housing as a central public policy. However, it also reveals that accumulated success does not guarantee immunity from phenomena such as symbolic exclusion, neighbourhood fragmentation, or the ecological limitations of urban expansion.

The Viennese case allows for a reorientation of the public-sector innovation debate toward the need to strengthen institutional models capable of sustaining inclusive policies over time, without relying solely on disruptive impulses. This article argues that genuine innovation does not lie only in inventing new solutions, but in knowing how to adapt and expand those that have already proven effective, just, and resilient in the complex contexts the world will continue to face in the coming years. In doing so, it contributes to a more nuanced, situated, and critical perspective on public-sector innovation in the housing domain, in line with the aims of this Special Issue.

2. Theoretical Framework

2.1. Historical Context

The history of Vienna’s public housing model is commonly traced back to the inter-war period, when the municipal government—led by the Social Democratic Party—initiated the major transformations associated with the so-called Red Vienna era (Essletzbichler & Forcher, 2022). The aim was to ensure decent living conditions for the working class, which, following the First World War and the collapse of the Austro-Hungarian Empire, faced severe housing shortages. To address this, numerous Gemeindebauten (municipal housing blocks) were constructed between 1919 and 1934, financed primarily through dedicated taxation and directed by the local administration. This foundational moment laid the groundwork for a model that, with various modifications, has endured to the present day, constituting a distinctive case in the European public housing debate (Eder et al., 2018).

After the Second World War, the municipality renewed its commitment to housing policy, undertaking the reconstruction of large areas of the city while maintaining its strategy of direct intervention. As a result, Red Vienna evolved beyond its initial phase, giving rise to one of the largest portfolios of public housing in the Western world. During the 1950s and 1960s, Vienna continued to expand its stock of social rental housing, applying strict rent controls and subsidy mechanisms (Essletzbichler & Forcher, 2022). In this way, municipal housing became accessible to a broad spectrum of the population, not just the poorest households (Franz & Gruber, 2018). This integration helped prevent the stigmatisation of public housing and fostered significant social mixing across many neighbourhoods.

However, from the 1980s onwards, local policies began to shift. Direct housing construction by the municipality declined, and increasing responsibility was delegated to limited-profit housing associations (Franz & Gruber, 2018). This entailed a relative change in governance: the municipality assumed the role of regulator and funder rather than direct builder. Even so, the subsidy and control frameworks remained robust, meaning rents remained moderate by European standards (Eder et al., 2018). Indeed, the model was upheld by a suite of instruments: profit caps for non-profit associations, a strong emphasis on construction quality, and closely monitored housing allocation procedures. In this way, state intervention extended throughout the entire housing production and usage cycle.

In the post-war period, the reputation of the Viennese model was further solidified as an example of urban policy that combined high housing standards with relative affordability (Essletzbichler & Forcher, 2022; Franz & Gruber, 2018). Yet from the 1990s onwards and into the twenty-first century, new pressures emerged: rising land costs in central areas, the growing financialisation of the economy (Aigner, 2022), and the need to accommodate population groups with different profiles than before—such as migrants, single-parent families, and refugees. On one hand, Vienna’s integration into global dynamics encouraged investors to purchase flats as assets, a phenomenon described by Aigner (2022) through the rise in Vorsorgewohnungen (investment apartments), which strains the state’s capacity to curb price escalation. On the other, increasing demographic diversity poses challenges for housing allocation and maintenance (Aigner, 2019).

Successive reforms aimed at partial liberalisation of the housing sector have impacted the municipal stock, which remains substantial but is under pressure to modernise and compete with the private sector (Essletzbichler & Forcher, 2022). As several authors note, the city largely ceased large-scale direct municipal construction in the 1990s, relying instead on non-profit co-operatives and regulatory mechanisms—such as rent controls and project competitions—to uphold the model (Franz & Gruber, 2018). While this approach has preserved relative stability, it has also produced a dual structure: lower-cost municipal units on one side, and the co-operative or limited-profit subsector on the other (Eder et al., 2018). In effect, the municipality broadened the range of actors involved—a kind of semi-privatisation—without entirely relinquishing state intervention.

Another key historical factor is land policy. Thanks to the city’s early and strategic land acquisitions during previous decades and the legacy of Red Vienna, the municipality has retained a degree of control over where and how new residential complexes are built. Nonetheless, since the late twentieth century, rising land prices and investor interest have increasingly hindered the realisation of large-scale social housing projects. In response, Vienna’s administration has implemented mechanisms such as design competitions that prioritise architectural quality, environmental sustainability, and social sustainability. These initiatives aim to reconcile the tradition of public control with the demands of a globalised economy.

At the same time, Vienna’s internal sociopolitical dynamics have also shaped housing policy. After decades of Social Democratic dominance, the rise in a populist right has challenged aspects of social spending and mobilised segments of the working class. This political debate has revived the image of Red Vienna as a symbol of inclusive policy, while also exposing tensions within the electoral base, particularly regarding who should receive housing priority, nationality criteria, and length of residency requirements (Essletzbichler & Forcher, 2022).

Entering the twenty-first century, various studies have pointed to the rise in gentrification and the displacement of the most vulnerable populations to peripheral districts. Although less intense than in other European metropolises, these processes reveal that socio-spatial segmentation is still present in what is often called the most liveable city in the world (Aigner, 2022; Banabak et al., 2024). The Viennese model, therefore, faces the challenge of preserving its universalist ethos while adapting to a globalised market driven by speculative capital flows. Nevertheless, most authors agree that, despite these pressures, Vienna continues to maintain levels of housing affordability and social cohesion that surpass the European average—regardless of how distracting global rankings can be when they conflate place branding with everyday life (Eder et al., 2018; Franz & Gruber, 2018).

The historical trajectory of Vienna’s public housing model began with a radical push for municipal construction during the Red Vienna period. Following the post-war recovery, the model was consolidated into one of the most prominent examples of state intervention in the housing market. By the late twentieth century, a reorganisation took place in which the state ceded space to non-profit cooperatives while reinforcing regulation and subsidised financing. Today, amid rising land prices and global financialisation, the city must balance its social legacy with private sector competition and emerging demographic needs. Despite internal contradictions, Vienna remains a global reference point for how sustained public intervention—rooted in the legacy of Red Vienna—can maintain a large stock of affordable housing and moderate urban segregation. A synthesis of Vienna’s public housing policy is presented in

Table 1. Synthesis of Vienna’s public housing policy history. Source: Authors’ own work.

Period	Sociopolitical Context	Main Measures	Outcomes/Impact	References
1919–1934 (Red Vienna)	City under Social Democratic rule after WWI.	Massive construction of Gemeindebauten (municipal housing blocks).	Around 60,000 municipal housing units built in a decade.	Essletzbichler and Forcher (2022); Eder et al. (2018)
	Growing housing crisis.	Funded through specific taxation.	Foundations laid for a large public stock with moderate rents and integrated services (schools, common areas).
	Strong belief in state intervention.	Policies targeted at the working class.	First step toward establishing “Red Vienna” as a social city brand.
1934–1945 (Interwar & WWII period)	Authoritarian regimes (Austro-fascism followed by Nazism).	Reduction in municipal housing programmes.	Municipal housing stock maintained but not significantly expanded.	Essletzbichler and Forcher (2022)
	Many social initiatives suspended.		Deterioration in some blocks due to lack of maintenance.
Postwar (1945–1960s)	Reconstruction after WWII.	Reactivation of municipal housing using state funds and Marshall Plan aid.	Expansion of social housing provision.	Franz and Gruber (2018); Essletzbichler and Forcher (2022)
	Continued Social Democratic dominance in city governance.	Implementation of strict rent controls and construction subsidies.	Consolidation of a large-scale public housing model; municipal housing remained accessible to a large proportion of the population.
1970s–1980s	Welfare state peak in Europe, despite early signs of fiscal crisis.	Strengthened state subsidies and adjustments to direct construction.	Upgrades in Gemeindebauten quality (rehabilitations, modernisations).	Eder et al. (2018); Franz and Gruber (2018)
	Rising public housing maintenance costs.	Increased technical sophistication in municipal management.	Public investment increased, but early signs emerged of the limitations of a purely state-driven formula.
1990s–early 2000s	Global changes: neoliberalisation, market pressure.	Decline in direct municipal construction.	Introduction of competitive project and land allocation procedures.	Marquardt and Glaser (2023); Aigner (2019)
	Rising immigration and demand diversification.	Delegation to Limited-Profit Housing Associations.	A large stock of social rental housing maintained (~40% of total), but allocation tensions arose (waiting lists, stricter eligibility).
		Rent controls maintained, though slightly loosened.	Increased competition in the cooperative sector.
2000s–present	Global financialisation of housing.	Adoption of new standards (sustainability, innovation).	High share of affordable housing preserved; gentrification is mitigated but not eliminated.	Aigner (2022); Banabak et al. (2024); Eder et al. (2018)
	Rising land values in central areas.	Renewed interest in collaborative models (co-housing, commons).	Tension between the social legacy and increased private investment.
	Debates on gentrification emerge.	Price containment and inclusive zoning policies.	Criticism arises over exclusion of specific groups (refugees, low-income migrants).

.

2.2. The Vienna Model

Vienna’s enduring housing system is multifaceted, built upon a scaffolding of clearly defined components and influencing factors. To enhance clarity, its key operational features can be delineated as follows:

• A Comprehensive Legal and Regulatory Framework: At its core is the General Tenancy Law (Mietrechtsgesetz, MRG), which establishes critical protections such as rent ceilings, defines tenant and landlord rights and obligations, and safeguards against arbitrary eviction.
• Centralised Public Administration and Management: The municipal agency, Wiener Wohnen, plays a pivotal role in administering the extensive municipal housing stock (Gemeindebauten) and enforcing cohabitation regulations detailed in the Hausordnung (house rules) (Magistrat der Stadt Wien—Wiener Wohnen, 2024b).
• Dual Financial Subsidy System: A distinctive feature is the dual subsidy model, where public funds support both the supply side (financing new construction and renovations) and the demand side (providing direct assistance to low-income tenants) (Magistrat der Stadt Wien—Wiener Wohnen, 2024d, 2024e). This is complemented by regulated operating costs (Betriebskosten) for tenants.
• Integral Role of Non-Profit Housing Associations: Limited-profit housing associations (Bauträger&lt), organised under bodies like the Österreichischer Verband gemeinnütziger Bauvereinigungen (2016), function as crucial partners in developing and managing a significant portion of Vienna’s regulated rental housing, historically complementing direct municipal provision and adhering to strict quality and affordability criteria.
• Socially Oriented Allocation and Tenancy Support: The model incorporates specific criteria for housing allocation alongside robust support mechanisms, such as advisory services and assistance for tenants in rent arrears (Magistrat der Stadt Wien—Wiener Wohnen, 2024a), aimed at ensuring residential stability and preventing eviction.
• These core mechanisms function within a dynamic environment shaped by significant influencing factors, including persistent financialization pressures, the challenge of rising land values, and the evolving demographic needs of a diverse population, including migrants and refugees. The following detailed analysis will further elaborate on these elements and integrate critical perspectives from the academic literature.

According to the city’s official documents (Magistrat der Stadt Wien—Wiener Wohnen, 2024d, 2024e), over one million residents live in housing promoted or managed by municipal authorities and non-profit associations, with a substantial proportion residing in the so-called Gemeindebauten. The primary legal instrument governing tenancies is the General Tenancy Law (Mietrechtsgesetz, MRG), which defines rent ceilings, tenants’ and landlords’ rights and obligations, as well as contractual duration and protections against eviction.

Through its agency, Wiener Wohnen, the City of Vienna administers the municipal buildings and sets out regulations for cohabitation as outlined in the Hausordnung (Magistrat der Stadt Wien—Wiener Wohnen, 2024b). These rules specify, for instance, the need to maintain communal areas, observe quiet hours during the night, and ensure the unobstructed use of corridors and staircases. Tenants are not allowed to leave furniture or waste in the hallways, and noise is prohibited between 10:00 p.m. and 6:00 a.m. The administration is also committed to intervening in cases of structural damage, provided the issue is reported in a timely manner. Monthly housing costs include charges for cleaning of common areas, hallway lighting, fire insurance, and other costs referred to as Betriebskosten. These vary according to the size of the dwelling and may include additional charges for lifts or other building amenities. There is also a strong emphasis on neighbourly cooperation, such as the expectation that bulky waste is not left in corridors but disposed of at designated collection points.

In cases of rent arrears, there are support mechanisms and advisory services as detailed in the document on rent payment assistance (Magistrat der Stadt Wien—Wiener Wohnen, 2024a), which includes options such as instalment agreements or access to national schemes like the Wohnschirm, offered by the Ministry of Social Affairs, subject to eligibility. The overarching aim, according to the authorities, is to prevent eviction and maintain residential stability. More broadly, the federal Mietrechtsgesetz includes specific protections for social housing tenants.

This formal structure is complemented by the work of non-profit housing developers or Bauträger, organised under the Österreichischer Verband gemeinnütziger Bauvereinigungen (2016), an umbrella organisation with a history spanning seventy years. Its commemorative Festschrift highlights the historical significance of housing cooperatives and limited-profit associations in providing affordable housing, particularly during the post-war period and the subsequent expansion of the protected housing stock. These associations have played a critical role in ensuring that Vienna maintains a high proportion of regulated rental housing, thus helping to buffer speculative pressures. As official publications state (Magistrat der Stadt Wien—Wiener Wohnen, 2024d, 2024e), the city employs a dual subsidy model: funding is allocated both to the supply side (new construction and renovation) and the demand side (support for low-income tenants). This approach contrasts with that of other European contexts, where only tenants receive direct support.

Nonetheless, the academic literature introduces important nuances regarding the model’s tensions. Aigner (2019, 2022) notes the increasing influence of financialisation through Vorsorgewohnungen (investment flats), where small and medium investors seek profit through apartment purchases. This phenomenon risks driving up prices and undermining the affordability principle at the core of the Viennese model. Aigner (2019) also documents how the entry of refugees and migrants is not always compatible with registration procedures and the selection criteria of Wiener Wohnen, creating barriers to accessing municipal housing. In parallel, Banabak et al. identify a pattern of displacement or “suburbanisation of poverty”, whereby low-income populations seek cheaper rents in peripheral areas, moving further away from centrally located, better-equipped neighbourhoods. Franz and Gruber point out that, while the reputation of Wohnen für alle (“housing for all”) endures, rising land prices and housing demand could create bottlenecks; they also emphasise the need to modernise allocation processes and simplify regulations to prevent cost inflation in housing construction.

Despite these challenges, the municipal policies and the cooperative system are still seen as instrumental in preventing extreme socio-spatial stratification in high-value urban zones, enabling a degree of social mixing. Similarly, the notion of Commons, as described by Hölzl and Hölzl, reinforces local inventiveness through collaborative housing projects initiated by citizen collectives and aligned with municipal policy. Although these projects remain a minority within the overall system, they illustrate the model’s flexibility in experimenting with new forms of tenure and management.

Vienna’s housing system thus operates through a combination of a large-scale municipal stock managed by Wiener Wohnen under clearly defined operational rules—from the Hausordnung governing daily life to protocols for arrears support—and non-profit cooperatives sustained through public subsidies. The federal Mietrechtsgesetz provides legal support for tenant protection and the definition of rights and obligations. Nonetheless, critical studies point to mounting pressure from investors and rising land prices, which may challenge the model’s universalist ethos. As long as the city continues to invest in the construction of Gemeindebauten and to oversee housing costs, the Viennese model remains a benchmark for public housing policy, firmly rooted in public intervention, yet not immune to the contradictions of contemporary urban realities.

3. Materials and Methods

The methodology employed in this study is a systematic search and qualitative evidence synthesis of secondary sources, with the aim of producing a critical evaluation of the Vienna public housing model by examining its historical transformations, institutional architecture, and contemporary tensions.

The corpus analysed comprised scientific literature and official documents. The scientific literature was primarily identified through the Scopus database. The search strategy employed combinations of keywords including, but not limited to, “Vienna” AND (“public housing” OR “social housing” OR “Gemeindebauten”) AND (“housing policy” OR “institutional innovation” OR “urban inclusion” OR “housing governance” OR “affordability”). The search was not restricted by publication date to ensure historical depth, but focused on materials accessible up to early 2024 to capture the most current discussions.

Inclusion criteria for academic articles were (i) peer-reviewed scholarly works (articles, and to a lesser extent, key academic book chapters if directly relevant); (ii) published in English or German; (iii) direct thematic relevance to Vienna’s public housing model, engaging in-depth with issues such as affordability, sustainability, exclusion, governance, or alternative housing models; (iv) emphasis on articles published in high-impact journals in the fields of urban studies, public policy, and territorial planning to ensure a baseline of academic rigour and quality; (v) official documents were sourced from the City of Vienna (Magistrat der Stadt Wien—Wiener Wohnen) and the Austrian legislative framework.

The initial database search yielded approximately 150 records. Titles and abstracts were screened for relevance against the inclusion criteria, reducing the pool to 50 articles for full-text review. Following a detailed assessment of the full texts, 29 academic articles were selected for their direct contribution to the research objectives. These were supplemented by 8 key official documents crucial for understanding the regulatory and operational aspects of the Viennese model. This dual-source strategy enabled triangulation between empirical data, regulatory frameworks, and theoretical debates (Bowen, 2009; Yin, 2003). The selected academic articles include key contributions from scholars such as (Kadi, 2015; Kadi & Lilius, 2024), Aigner (2019, 2022), Franz and Gruber (2018), Essletzbichler and Forcher (2022), and Eder et al. (2018). The official documents include sources such as the Mietrechtsgesetz [General Tenancy Law of Austria, the Municipal Housing in Vienna brochure (Magistrat der Stadt Wien—Wiener Wohnen, 2024d), the Hausordnung (Magistrat der Stadt Wien—Wiener Wohnen, 2024b), the Betriebskosten document on operating costs (Magistrat der Stadt Wien—Wiener Wohnen, 2024c), protocols on non-payment assistance (Magistrat der Stadt Wien—Wiener Wohnen, 2024a), and the Festschrift of the Österreichischer Verband gemeinnütziger Bauvereinigungen (2016).

The analysis followed a qualitative-interpretative methodological strategy, organised into three interconnected phases.

Coding: In the first phase, an open and axial coding process (Bowen, 2009; Richards & Hemphill, 2018) was applied to all selected sources. The objective was to systematically identify recurring concepts (e.g., ‘slow innovation’, ‘universalism’), analytical oppositions (e.g., ‘inclusion vs. exclusion’, ‘stability vs. rigidity’), and thematic patterns related to the Viennese housing model.

Thematic Clustering: Based on this coding, a thematic clustering was developed. This allowed the classification of the information from the sources into seven major analytical axes: institutional stability, accessibility, socio-spatial equity, financialisation, social innovation, sustainability (both social and environmental), and symbolic dimensions.

Thematic Analysis and Interpretation: The second phase consisted of a thematic analysis (Braun & Clarke, 2006) with emphasis on the relationship between normative discourse (e.g., official policy aims) and urban experience (e.g., empirical findings of exclusion or fragmentation), facilitating a contrast between institutional prescriptions and the empirical findings documented in the literature. The third phase involved an integrative interpretation of the results, following an abductive logic (Bhattacherjee, 2012), aimed at connecting the emergent findings with conceptual frameworks in public administration and urban policy.

To further elaborate on the rigour of this three-phase analytical strategy, the initial coding process was primarily inductive, allowing themes to emerge directly from the data through open coding; this was then refined using axial coding to systematically develop categories. While these themes were data-driven, their subsequent clustering into the seven major analytical axes was guided by the study’s core research questions and thematic focus areas, thus forming an empirically derived framework for the analysis. Throughout the thematic analysis phase, which involved comparing and contrasting data across these axes, careful attention was given by the author(s) to distinguishing normative claims within official documents from empirical evidence and critical perspectives in the scholarly literature, ensuring a balanced interpretation. Iterative review and reflexivity were employed by the author(s) throughout this process to ensure consistency and depth (Braun & Clarke, 2006; Richards & Hemphill, 2018).

Among the limitations of this study, it is important to note the absence of empirical fieldwork, relying solely on secondary data, which restricts access to citizen-based or neighbourhood-level discourses that are not institutionally codified. Furthermore, while the Viennese model is paradigmatic, it is also embedded in specific historical and political conditions, and thus any generalisation must be approached with caution (Creswell, 2007; Yin, 2003).

4. Results: Lights and Shadows of Vienna’s Housing Paradigm

Vienna’s public housing model has long been regarded as a global benchmark for inclusive urbanism, price regulation, and institutional stability. Rooted in the legacy of Red Vienna, it has endured thanks to a robust state apparatus and a consistent political commitment to the social function of housing. This historical trajectory has enabled the city to maintain a large, accessible, and high-quality housing stock, even as much of Europe has witnessed a retreat of the state from urban affairs. Kadi and Lilius (2024) emphasise that this stability is no accident, but the product of an institutional architecture explicitly designed to uphold redistributive policies and resist the commodification of housing, thereby avoiding mass privatisation and allowing for a sustained production of social housing within an expanding metropolitan context.

However, this image of success must not obscure the internal tensions and contradictions that the model encapsulates. While socio-economic segregation has been structurally contained, specific dynamics of exclusion persist. Aigner (2019) demonstrates that refugees, despite the availability of a vast social housing stock, encounter numerous barriers to accessing the formal system, often being forced into precarious informal submarkets. Far from being an isolated case, this highlights one of the model’s fundamental paradoxes: its universalist ethos coexists with eligibility criteria and institutional practices that reproduce exclusion. Along similar lines, Wolfgring and Peverini (2024) identify that the most economically vulnerable groups continue to rely on the private rental market, exposing them to heightened housing insecurity.

Moreover, the model’s stability has not shielded it from processes of re-commodification. Kadi (2015) warns that since the 1990s, responsibility for producing social housing has been increasingly delegated to non-profit associations, reducing the municipality’s direct role. This shift has strained the universalist character of the system, as allocation, construction, and financing mechanisms are now more influenced by logics of efficiency and financial sustainability. Additionally, Aigner (2022) shows how the financialisation of housing has advanced through investment instruments such as the Vorsorgewohnung, which, despite their original intentions, have contributed to price inflation and eroded affordability.

Yet the model also reveals signs of adaptability and renewal. In response to the limitations of conventional public provision, collaborative housing initiatives have emerged, proposing alternative ways of producing and managing residential space. Hölzl et al. (2022) explore the case of the habiTAT movement, which supports self-managed, collectively owned housing projects. Although still marginal within the overall system, these initiatives reflect grassroots political innovation aimed at reconfiguring the relationship between state, market, and community. This alternative momentum has also been explored by Schikowitz and Pohler (2024), who analyse the relational practices of Baugruppen as attempts to transcend both the standardisation of public housing and the commodification of the private market. However, these efforts are constrained by rigid regulatory frameworks and institutional expectations, revealing that even the most innovative housing practices remain entangled in structural tensions.

The symbolic dimension of the model is similarly marked by ambivalence. In his analysis of the Hundertwasser-Haus, Kraftl (2007) argues that this iconic building encapsulates the utopian ideal of Viennese living, but that such utopia becomes incoherent when confronted with the lived experiences of its residents, who do not necessarily engage with the narrative projected by the architecture. Similarly, initiatives such as those in Sonnwendviertel Ost, studied by Babos et al. (2024), promote shared spatial practices and neighbourhood identity, yet their structural impact is limited by political and institutional constraints, hindering their replicability.

Vienna’s social cohesion goals, central to its urban planning philosophy, have also been questioned from an empirical perspective. Unterdorfer (2016), through an ethnographic study in Rudolfsheim-Fünfhaus, shows that the rhetoric of social mixing does not necessarily translate into meaningful everyday interaction between residents. This casts doubt on the model’s effectiveness in fostering sustained social engagement, thereby weakening one of its most frequently cited normative pillars. What is presented as integration sometimes appears fragmented in everyday life, revealing relational disconnections that lie beyond the reach of housing policy.

From a macro-comparative perspective, Tammaru et al. (2015) position Vienna among the European cities with the lowest levels of socio-economic segregation, partly due to its public housing system. However, they also warn of a recent widening of social inequalities, which could undermine this structural advantage unless the model is adapted to new economic and demographic realities. This risk is underscored by Paidakaki and Lang (2021), who argue that social sustainability in housing can only be maintained if it is pursued as a collective political project involving state actors, communities, and the third sector. This would require the system to embrace new household configurations, foster democratic participation, and strengthen public-community cooperation mechanisms.

In this light, Vienna’s public housing experience represents a blend of undeniable achievements in affordability, stability, and institutional control, alongside unresolved challenges around effective inclusion, adaptability to emerging conditions, ecological sustainability, and openness to novel forms of living (

Table 2. Summary of lights and shadows of housing policy in Vienna. Source: Authors’ own work.

Thematic Axis	Lights (Positive Aspects)	Shadows (Negative Aspects)
Institutional Stability	Strong continuity of the public housing system supported by clear rules, long-term planning, and firm political will (Kadi & Lilius, 2024).	Dependence on stable institutional structures, which may exhibit rigidity in the face of crises or abrupt political changes (Marquardt & Glaser, 2023).
Accessibility and Affordability	Broad provision of public housing and rent control reduce pressure on the private market and benefit middle-income groups (Franz & Gruber, 2018).	Structural exclusions persist: refugees and the poorest segments of the population face access barriers and are pushed into precarious submarkets (Aigner, 2019; Wolfgring & Peverini, 2024).
Socio-Spatial Equity	Low socio-economic segregation in the European context; equitable access to urban amenities (Morawetz & Klaiber, 2022; Tammaru et al., 2015).	Recent widening of social gaps; the ideal of “social mix” does not necessarily translate into neighbourhood cohesion or meaningful interaction (Unterdorfer, 2016).
Resistance to Financialisation	Effective public regulation has curtailed large-scale privatisation of the housing stock (Kadi & Lilius, 2024).	Subtle re-commodification processes through instruments such as the Vorsorgewohnung, which increase prices and undermine affordability (Aigner, 2022).
Social Innovation and Alternative Models	Emergence of collaborative housing initiatives (habiTAT, Baugruppen) aiming to re-politicise housing and counter market logic (Hölzl et al., 2022; Schikowitz & Pohler, 2024).	Structural and regulatory limitations imposed by the public apparatus; still marginal institutional support hampers scalability (Schikowitz & Pohler, 2024).
Symbolic and Cultural Dimension	Presence of utopian architecture such as the Hundertwasser-Haus and neighbourhoods with strong local identities (Babos et al., 2024).	Disconnection between the symbolic ideal of dwelling and the lived experiences of residents (Kraftl, 2007).
Social Sustainability	Civil society–state alliances promote more inclusive and participatory governance models (Paidakaki & Lang, 2021).	Institutional exclusion of non-normative family configurations and limits to effective participation persist (Paidakaki & Lang, 2021).
Environmental Sustainability	Ongoing initiatives aim to link social and environmental justice in urban planning (Novy et al., 2001).	Continued emphasis on expansion rather than rehabilitation weakens climate justice goals (Novy et al., 2001).

). The model has not failed, but neither is it the finished product of its own success. Its strength lies partly in its capacity to maintain a public infrastructure in the face of commodification pressures, and partly in its ability to incorporate new demands without betraying its founding principles. Yet this calls for critical reflection on its own assumptions, a willingness to engage in institutional innovation, and a conscious effort to prevent stability from calcifying into inertia. Vienna’s public housing model, rather than a completed paradigm, emerges as a dynamic field of tensions—between tradition and renewal, inclusion and exclusion, institutional design and lived experience.

5. Discussion

The dialogue between the claims outlined in the article’s introduction and the findings presented in the “Lights and Shadows” section enables a critical bridge to be built between the normative principles underpinning the Viennese housing model and the tensions that arise in its practical implementation. The introduction firmly asserts that Vienna’s housing system does not embody public-sector innovation in the disruptive sense but rather represents a form of “slow institutional innovation”—grounded in the system’s capacity to adapt progressively without compromising its foundational ethos. This framing suggests that the strength of the model lies not in its ability to reinvent itself constantly, but in its ability to absorb new agendas—such as environmental sustainability or urban co-production—within a consolidated governance structure. However, as the following analysis will elaborate, when this vision is set against documented empirical realities, tensions emerge that problematise the celebrated stability, exposing underlying structural limits and persistent inequities that must be incorporated into any forward-looking reflection on the model’s future.

5.1. Empirical Insights: Navigating Achievements and Contradictions

An empirically observable strength of the Viennese model is its remarkable capacity to maintain high levels of housing accessibility amidst intense market pressure. As highlighted in the “Lights” section, robust legal frameworks, comprehensive supply- and demand-side subsidies, and an active public apparatus have historically sustained a significant stock of regulated rental housing. This achievement in institutional control over urban space production and allocation is notable in comparative terms. However, this accessibility is empirically demonstrated to be far from universal. The research of Aigner, and of Wolfgring and Peverini, for instance, provides clear evidence of how specific social groups—particularly refugees, recent migrants, and households in extreme poverty—are effectively excluded from the formal system due to institutional barriers or restrictive eligibility criteria.

Furthermore, while the Viennese model shows an openness to incorporating new dimensions like collaborative housing, empirical studies on initiatives such as the habiTAT collective or Baugruppen (explored by Hölzl et al., 2022; Schikowitz & Pohler, 2024) illustrate that these forms of social innovation often emerge from poorly institutionalised margins. Their potential for scalability within the dominant, more rigid system appears limited, suggesting these alternative models are absorbed rather than structurally promoted by the existing framework.

The symbolic dimension of the model also reveals a gap between normative ideals and empirical realities. While Vienna is often lauded for upholding a vision of spatial justice and social integration, research by Kraftl on iconic projects like the Hundertwasser-Haus indicates a dissonance between architectural narratives of utopian living and residents’ actual lived experiences. Similarly, Unterdorfer’s work suggests that policy-driven social mixing does not automatically translate into meaningful neighbourly interaction or enhanced community solidarity.

Finally, concerning environmental sustainability, while Vienna has initiated “greening” strategies in its urban planning, empirical critiques, such as those by Novy et al. (2001), point to a prevailing logic of urban expansion that often overshadows efforts towards rehabilitating the existing housing stock. This preference can weaken broader climate justice objectives, highlighting a persistent tension between new environmental agendas and traditional growth paradigms.

5.2. Conceptual Reassessment and Normative Implications

The empirical evidence of selective accessibility and the constrained scalability of grassroots social innovations necessitates a reinterpretation of the “slow institutional innovation” conceptualised in this article. While the model adeptly incorporates certain new agendas, its innovative capacity seems shaped by a logic of institutional self-preservation. The system appears to adopt new practices primarily when they align with and maintain its core normative architecture; however, this very stability, a hallmark of its success, may also inhibit more profound or disruptive transformations deemed necessary by some critics.

Thus, “innovation from within” might require significant external momentum or a deliberate normative recalibration that fosters greater institutional flexibility without sacrificing quality or affordability. Figure 1 representes a brief summary of findings related to the Vienna’s model.

The documented disconnect between the ideal of integrated community life and the often-fragmented lived experiences of residents calls for a normative rethinking of the model. This involves looking beyond legal and physical housing structures to consider how relational dynamics and genuine community co-production can be more effectively supported. Similarly, the observed duality in environmental efforts—a gradual embrace of green agendas constrained by traditional urban development patterns—underscores that the Viennese model, far from being a static paradigm, is a dynamic field of contestation requiring continuous improvement and critical self-assessment regarding its ecological commitments.

The Viennese experience demonstrates that innovation in public housing need not be a radical break with the past but can be a progressive reconfiguration of long-standing foundations. This realisation, however, brings forth substantive normative challenges for the future: How can genuine inclusion be broadened without diluting the quality control and regulatory mechanisms that are central to the model’s renown? How can the system become more genuinely open to participatory forms of co-production without inducing fragmentation or operational inefficiencies? And, crucially, how can ecological, economic, and social imperatives be integrated more coherently within a regulatory framework shaped by historically distinct conditions? This discussion, therefore, offers a nuanced assessment of the Viennese case, intended as a call to critically rethink public policy innovation when historical successes begin to reveal their inherent limitations and blind spots.

6. Conclusions

This study reaffirms Vienna’s public housing model as a paradigmatic case of slow institutional innovation within the public sector. Characterised not by disruptive upheaval but by an enduring capacity to uphold social justice, public land control, and housing accessibility through stable legal mechanisms and a long-term administrative architecture, its efficacy in resisting market financialisation and ensuring broad affordability is a central finding. Nevertheless, this celebrated stability coexists with significant structural tensions, including the exclusion of certain vulnerable groups, fragmented community experiences, and challenges in deeply integrating comprehensive sustainability and genuinely participatory governance.

The primary theoretical contribution of this article lies in the conceptualization and empirical grounding of slow institutional innovation. This concept enriches the broader innovation literature by offering a critical alternative to dominant narratives that often equate public sector innovation primarily with rapid, technologically driven disruption or market-mimicking reforms. We argue that slow institutional innovation, as exemplified by Vienna, highlights how established public institutions can achieve profound and sustainable societal impact through gradual adaptation, the steadfast upholding of normative commitments (like housing as a social right), and strategic resistance to wholesale commodification. This perspective underscores the value of adaptive institutionalism, demonstrating that resilience, equity, and democratic legitimacy can be equally vital dimensions of innovation, particularly in core areas of welfare state governance such as housing. The Viennese experience offers critical and transferable insights for policymakers (Table 3) striving to create more equitable and stable housing systems:

• Prioritise Long-Term Institutional Stability and Public Stewardship: Municipalities should focus on building and maintaining robust public or socially controlled land banks, implementing effective rent regulation mechanisms, and ensuring sustained, ring-fenced public investment in both the construction of new affordable units and the comprehensive maintenance and ecological retrofitting of existing stock. This requires a long-term vision that moves beyond short-term, market-led solutions.
• Develop Integrated and Genuinely Inclusive Allocation Systems: While preserving the benefits of broad eligibility, housing authorities must proactively design and implement targeted strategies to counteract the exclusion of highly vulnerable populations (e.g., newly arrived refugees, individuals in extreme poverty, those with precarious legal status). This could involve enhancing inter-agency collaboration, simplifying access procedures, and providing dedicated support services.
• Embed Genuine Community Participation and Foster Co-Production: To move beyond superficial consultation, policymakers should create structural opportunities for meaningful tenant involvement in the governance and management of their housing. Furthermore, enabling legal and financial frameworks are needed to support the growth and integration of alternative tenure and management models, such as co-housing and community land trusts, allowing them to scale beyond niche experiments.
• Champion Deep Environmental and Social Sustainability Holistically: Urban housing policy must comprehensively integrate ecological and social goals. This means prioritising the deep ecological renovation of existing buildings alongside sustainable new construction, and strategically designing housing environments that actively foster social interaction, mutual support, and a tangible sense of community, rather than merely aiming for a demographic mix.

Table 3. Summary of policy recommendations.

Key Area	Policy Recommendations	Future Research Directions
Institutional Stability & Stewardship	Prioritise long-term public control of land, implement effective rent regulation, and ensure sustained public investment in new construction and maintenance/retrofitting of existing stock.	Conduct comparative institutional analyses between Vienna and other cities to identify the conditions that enable or constrain “slow innovation” in different contexts.
Inclusivity & Allocation	Develop targeted strategies to counteract exclusion by enhancing inter-agency collaboration, simplifying access, and providing dedicated support services.	Conduct ethnographic research to explore the lived realities of residents, how they navigate governance, and how inclusion efforts are perceived on the ground.
Governance & Participation	Create structural opportunities for meaningful tenant involvement in governance. Establish legal and financial frameworks to help alternative tenure models (e.g., co-housing) scale beyond niche experiments.	Investigate the barriers and enablers to scaling up grassroots housing innovations within larger, more bureaucratic systems.
Sustainability	Prioritise deep ecological renovation of existing buildings and design housing environments that actively foster social interaction and a tangible sense of community.	Explore how sustainability and community-building efforts are enacted and experienced at the ground level through fine-grained ethnographic studies.

Table 3. Summary of policy recommendations.

Key Area	Policy Recommendations	Future Research Directions
Institutional Stability & Stewardship	Prioritise long-term public control of land, implement effective rent regulation, and ensure sustained public investment in new construction and maintenance/retrofitting of existing stock.	Conduct comparative institutional analyses between Vienna and other cities to identify the conditions that enable or constrain “slow innovation” in different contexts.
Inclusivity & Allocation	Develop targeted strategies to counteract exclusion by enhancing inter-agency collaboration, simplifying access, and providing dedicated support services.	Conduct ethnographic research to explore the lived realities of residents, how they navigate governance, and how inclusion efforts are perceived on the ground.
Governance & Participation	Create structural opportunities for meaningful tenant involvement in governance. Establish legal and financial frameworks to help alternative tenure models (e.g., co-housing) scale beyond niche experiments.	Investigate the barriers and enablers to scaling up grassroots housing innovations within larger, more bureaucratic systems.
Sustainability	Prioritise deep ecological renovation of existing buildings and design housing environments that actively foster social interaction and a tangible sense of community.	Explore how sustainability and community-building efforts are enacted and experienced at the ground level through fine-grained ethnographic studies.

The conclusions of this study should be considered in light of its limitations, primarily its reliance on secondary data, the absence of systematic cross-national comparison, and a limited examination of the internal administrative processes of the Viennese system. These limitations, however, open avenues for future research:

• Comparative Institutional Analyses of “Slow Innovation”: Future research could conduct in-depth, qualitative comparative studies between Vienna and other cities (e.g., Helsinki, as explored by Kadi & Lilius, or cities with more residual housing systems) to identify the specific institutional configurations, political conditions, and policy levers that enable or constrain the development and resilience of “slow innovation” in diverse socio-economic contexts.
• Ethnographic Exploration of Governance and Lived Realities: There is a need for fine-grained ethnographic research within various Viennese public, cooperative, and co-housing settings. Such studies could investigate how residents experience and negotiate governance structures, how social interactions are shaped by design and management, and how efforts towards inclusion, sustainability, and participation are perceived and enacted at the ground level.
• Investigating Mechanisms for Scaling and Adapting Innovations: Future studies should critically examine the barriers and enablers to scaling up successful grassroots housing innovations (like Baugruppen or habiTAT projects) within larger, more bureaucratized housing systems. This includes exploring how core principles of the Viennese model (e.g., public land control, dual subsidy systems) might be adapted in cities with different political economies and resource constraints.
• Developing Frameworks for Evaluating “Slow Institutional Innovation”: Research is needed to develop robust analytical frameworks and metrics specifically designed to assess the multifaceted impacts of “slow institutional innovation.” These should capture not only quantitative outputs but also qualitative dimensions such as institutional resilience, democratic legitimacy, long-term social equity, and the capacity for adaptive learning within public organisations.

In conclusion, Vienna’s enduring public housing model serves as a crucial reminder that effective, equitable, and sustainable urban development can stem from patient, institutionally embedded innovation. Its ongoing adaptation offers vital lessons for cities worldwide striving to reaffirm housing as a fundamental social right and a cornerstone of inclusive urban life.