THE PUZZLE OF HOUSING PRIVATIZATION IN EASTERN EUROPE

This paper focuses on the part of the housing sector proving most difficult to reform in Eastern Europe-State-owned rentals—which typically constitute about 20 percent on the housing stock overall and half of the units in the largest cities. The paper argues that two objectives must be pursued simultaneously: (1) selling units at or near market prices to tenants or other households willing to purchase them; and (2) integrating the remaining state-owned rentals with the nascent but expanding rental market. The six elements of a strategy for achieving these objectives are described.