Homeownership in Shrinking Cities: An Analysis in the Baltic Sea Region

Trends of demographic change, outmigration and deindustrialisation create challenges associated with population and/or industrial decline affecting not only rural areas but also cities. Among their counterparts in the world, shrinking cities in the Baltic Sea Region are some of the most dramatically affected and transformed ones regarding the shifts in volume and density in their physical and social entities. At the same time, shrinkage is interlinked with economic, social, and institutional aspects in the Baltic Sea Region and, is associated with a complex process joining trends of population decline, alterations in the volume of economic activities over time and, shifts in the quantity and quality of material stocks. According to the existing literature (Bernt et al., 2017; Couch & Cocks, 2013; Gao et al., 2023), housing, as a component of the material stock, is a particular challenge and contains some spatial anomalies in the context of shrinkage in the Baltic Sea Region cities. Indeed, housing, with its different physical, economic and social forms, is not only a problem in the shrinking process but may also represent an opportunity for different groups. Abandoned and vacant housing stock transforms city landscapes while economic and population decline may reduce housing values.These trends may shape the function and accessibility of housing as a financial tool but also create an unstable environment in tenure structures. This complexity creates ambiguity in the value of housing in the context of shrinkage, where it may be perceived either as an affordable or a worthless investment. This ambiguity may hold consequences for ownership structure in shrinking cities and specifically for the role of owner-occupation, as the dominant tenure pattern in the region (Kohl, 2017). Hence, this research aims to investigate the relationship between urban shrinkage and homeownership structures in the Baltic Sea Region. Different spatial and institutional formations produce different dynamics. Therefore, this research considers shrinkage as a multidimensional process and aims to disentangle the economic and demographic perspectives of shrinkage. By doing so, it aims to quantify the extent of economic and demographic decline through the lens of the Baltic Sea Region cities and to investigate the consequences for owner-occupied housing patterns. Furthermore, the countries in the Baltic Sea Region are institutionally composed of different tenure and shrinking patterns.This research, thus, expects to reveal distinct tenure responses to the shrinkage process among the case areas. Using data from the European Population and Housing Census for the years, a regression-based analysis of the role of socio-economic and demographic factors in the form of the urban shrinkage process is carried out to explain the relationship between shrinkage and the owner-occupied housing sector, as well as distinguish the changes of owner-occupied housing in shrinking urban and rural areas.