By: Liza Honaker, Staff Writer
On September 26, 2021, over 56% of Berlin citizens voted to adopt a housing referendum aimed at seizing corporate-owned apartments and turning them over to the government to be converted into affordable housing. [1] If adopted, this would be an enormous win for advocates of socializing privately owned property to combat housing issues affecting much of the globe. The referendum itself is not binding, but it is a signifier of the general discontent felt by the people of Berlin as they continue to face rising costs in housing and population growth. [2] It’s unlikely that the German parliament will move to enforce the expropriation of over 220,000 apartments indicated in the referendum out of a reluctance to appear less attractive to future investors in the city as well as the constitutional challenges that legislation aiming to socialize privately owned property would face. [3]
The referendum was introduced and promoted by Deutsche Wohnen und Co. Enteignen, (interpreted as “Expropriate Deutsche Wohnen and Co.”), and its adaptation would cap private ownership of housing at 3,000 units [4] . Deutsche Wohnen, in contrast, owns around 113,000 housing units. Id. Berlin is Germany’s largest city and has around 3.5 million inhabitants, a population that has seen around .31% growth annually since 2015 [5] . Around half of the population is eligible for subsidized housing, based on their income, but available units are extremely difficult to find, especially in the inner city. Id. There, new construction in the past few years has centered almost entirely around luxury rentals, which is impossible to afford for most Berlin citizens. Id. This is largely due to a lack of incentive for property investors to construct affordable housing and has led to a cycle where the people of Berlin who are most in need of housing in these areas are the least likely to have the resources to stay there. Id. The city depends on working-class Berlin citizens to function, yet these workers find themselves living far away from their jobs, forced to adopt long and strenuous commutes in order to attain affordable housing.
The housing crisis has only been worsening in the city over the past decade. In 2018, rent had increased by 71% compared to rates from 2010 [6] , a trend that is perpetuated by property investors who continuously increase rent in highly sought-after areas, leaving units empty to drive demand. This profit-driven housing system works well in generating wealth for the corporations who own property but fails as public policy in keeping housing equitable and attainable. [7] The United States has had similar systemic issues in places like San Francisco and Manhattan where people who have low incomes are unable to afford accommodation near the metropolitan areas where they work. [8] As a result of this, these workers are forced to either adopt unreasonably long commutes to the city or live out of tents or vehicles near their workplace.
The referendum in Germany aims to accomplish what many of United States anti-trust laws are intended to do; limit the ability for corporations to form monopolies and ensure consumer protection against artificially driven price increases. [9] Socialization of property is one way to counteract the effects of profit-driven housing investments, [10] but it would entail broad commitment and massive legislative movement by the German parliament, which renders actual implementation unlikely. Proponents of the plan contend that this action would not create additional housing and that the money and effort needed for implementation should instead center around constructing new subsidized housing. [11] However, DW und Co. Enteignen asserts that the goal in socializing this property is to drive down rent for all the citizens of Berlin, not to create additional subsidized units. [12] The mayor of Berlin, Franziska Giffey, has not yet proposed another plan to combat the housing crisis but has made statements regarding her reluctance to expropriate housing. [13] Giffey maintains that expropriating properties would dissuade future investors from coming to Berlin and she believes that a bill allowing for the plan set out in the referendum would likely be unconstitutional. Id.
[1] https://www.dw.com/en/berliners-vote-yes-on-property-expropriation-but-what-happens-now/a-59070328
[2] https://www.bloomberg.com/news/features/2021-09-19/global-housing-markets-are-hurting-and-it-s-getting-political
[3] https://www.reuters.com/world/europe/berliners-vote-expropriate-large-landlords-non-binding-referendum-2021-09-27/
[4] https://www.dw.com/en/berliners-vote-yes-on-property-expropriation-but-what-happens-now/a-59070328
[5] http://www.iut.nu/wp-content/uploads/2017/03/Berlin-a-City-of-Tenants.pdf
[6] https://www.euronews.com/2018/05/11/cost-of-living-in-berlin-is-rising
[7] https://journals.sagepub.com/doi/full/10.1177/0042098019839875
[8] https://academiccommons.columbia.edu/doi/10.7916/d8-f0pe-9281
[9] https://heinonline.org/HOL/LandingPage?handle=hein.journals/tndl94&div=19&id=&page=
[10] https://eprints.whiterose.ac.uk/165444/1/Social_Justice_and_Economic_Systems_for_Philosophical_Topics_special_issue_on_Socialism_updated_.pdf
[11] https://play.acast.com/s/b2fb5f0b-0ce7-4e5c-b6e0-9b1febd06aea/615f1c829ad9a400134fd0a3
[12] https://play.acast.com/s/b2fb5f0b-0ce7-4e5c-b6e0-9b1febd06aea/615f1c829ad9a400134fd0a3
[13] https://www.reuters.com/world/europe/berliners-vote-expropriate-large-landlords-non-binding-referendum-2021-09-27/
