The German capital is bursting. More than 80 percent of the 3.7 million inhabitants of Berlin rent their houses. But the attractiveness of the city for investors, the structural lack of housing and the arrival of some 350,000 people in the last decade have skyrocketed rental prices.
At a rally in central Berlin, two weeks before the federal elections, protesters were demanding, among other things, a nationwide rent freeze and the construction of new affordable and social housing. A young protester in her 20s told euronews that she believes “it is important that people can afford to live in Berlin and that people are not expelled.”
Other protesters reiterate this thought and another recurring argument heard at the rally includes the high cost of living and stagnant wages.
Rent Limit Discarded
The Berlin local government last year tried to freeze rents for five years, with its “Mietendeckel” or rent cap. However, Germany’s constitutional court ruled in April that the cap violated the constitution, saying that the regulation of rents is in the hands of the federal government and not the regional state.
As rents continue to rise, the Berlin renters association says the growing gap between rich and poor is also worsening in the housing market.
“Housing has now become a risk of poverty,” says Rainer Wild, executive director of the Berlin Renters Association. “The basic problem is that not everyone has the same salary, but very different incomes. And meanwhile, households with below-average incomes bear the burden of housing costs of 50% or more.”
Rents in Berlin currently cost between € 5.30 per square meter for prefabricated “Plattenbau” apartments and at least € 13 per square meter for renovated pre-war buildings and new luxury constructions.
Competition for apartments is also high. In January this year, an average of 214 Berliners were competing for an apartment. Long lines of prospective tenants are still a common sight outside apartment blocks where visits are taking place.
But it is the sale of thousands of state-owned apartments to corporate owners in the late 1990s and early 2000s that is seen as one of the biggest contributing factors to Berlin’s real estate crisis.
“This is a problem that, for several years, we have tried not only to stop, but also to counteract with the remunicipalisation of part of the property. We have clearly demonstrated during this legislative period that this is possible,” he added. says the Berlin Secretary of State for Housing, Wenke Christoph.
A deal in 2019 saw Berlin’s state housing company Gewobag buy back 6,000 apartments in Berlin built as social housing between the 1960s and 1990s. The € 920 million buyback from Luxembourg real estate firm Ado Properties was the biggest effort by renationalisation of properties never seen in the German capital.
But the initiative “Expropriate Deutsche Wohnen & Co.” (The expropriated Deutsche Wohnen & Co.) wants to see more.
Earlier this year, the initiative collected 183,711 petition signatures, more than the 172,000 needed, to hold a referendum on possible expropriation. The petition calls for the expropriation of more than 240,000 homes that currently belong to major real estate companies, specifically those with more than 3,000 apartments in their portfolios.
“The appropriate legal term for what we are trying to do is socialization,” says Joanna Kusiak, a researcher in urban studies at the University of Cambridge and an activist for “Expropriate Deutsche Wohnen & Co.”
“This effectively means that this property must be taken away from the large corporations, but also that a new type of public institution must be created to administer this house in a democratic way.”
On September 26, Berliners will have the opportunity to vote on the contentious referendum. While it is not legally binding, the hope is to put political pressure on Berlin.
Meanwhile, new homes are being built, despite setbacks due to slow processing of building permits, as well as rising costs of building materials. The city-state housing and city development department estimated that about 200,000 new apartments needed to be built between 2017 and 2030 to meet the need for living space.
However, in the northwestern district of Berlin-Tegel, Heinz-Jürgen Korte and his neighbors are concerned about the plans of investors who bought the land they live on to build expensive condos.
“We want to keep our bike shop here. We want to preserve the site and of course we want to continue living here,” says Korte. “That does not mean that construction is not allowed here, Berlin needs flats. But we are committed to social and community-oriented development for property and development with good judgment.”
For now, construction plans on the land have been halted. But residents worry who will try next.
Homelessness and rising rents are hitting German cities beyond the capital, with around 670,000 apartments missing across the country. In addition to Berlin, major cities such as Stuttgart, Munich, Frankfurt and Cologne have been hit particularly hard by housing shortages.
As German voters head to the polls on September 26, it will not be just Berliners who will have the guarantee of affordable housing on their minds.
George is Digismak’s reported cum editor with 13 years of experience in Journalism