Wednesday, October 27

Berlin votes in favor of the expropriation of 240,000 homes



Once 96% of the ballots had been counted, the referendum held in Berlin to the expropriation of 240,000 homes from large owners shows a balance in favor of 56%. More than a million Berliners have spoken in favor of the project, which exceeds the necessary quorum and will become a priority of the next government, which will be headed by the Social Democrat Frankiska Giffey. “We are going to find a way to apply the result of the referendum,” said in her first statements the former Family Minister in the previous legislature and was displaced into local politics after a plagiarism scandal in her doctoral thesis.

Under the title “Expropriate Deutsche Wohnen & Co”, Berliners were able to vote yesterday in a referendum if large housing groups with more than 3,000 apartments in their portfolio and whose activity is for profit should be expropriated. The Berlin Senate is now called upon, according to the resolution, to “initiate all measures” that are necessary for the transfer of real estate to public property and to draft and process a law to that effect. Some 240,000 flats would be affected by the “socialization” process, that is, expropriated against compensation and transferred to a public law institution. We are talking about about 15% of the Berlin rental housing stock. But whether the Berlin Senate will finally draft such a law will depend on the political makeup of the new local government. The directives of the SPD, CDU, AfD and FDP parties are against expropriations. The left is in favor and the Greens consider this step possible “as a last resort.”

The vote, moreover, is not legally binding on politics, because a specific bill was not voted on, and although the new Senate and the newly elected House of Representatives go through the process, the bill may end up meeting resistance in the courts. The platform behind the referendum believes that with this measure it will be able to stop the increase in rents and ensure affordable long-term rents. According to the forecasts of the Senate, the costs of compensation would amount to between 29,000 and 36,000 million euros. The expropriation initiative, on the other hand, expects to pay between 7,300 and 13,700 million. In fact, he does not want to compensate realtors with money, but with bonds that will be repaid in 40 years with rental income. Most likely, the project will end in the Constitutional Court, which has already overthrown the previous initiative of this group, a limit on the rental price in Berlin.

“I am concerned about efforts to socialize living space in Berlin due to the possible effects on Germany’s attractiveness as an investment location,” said Andreas Arndt, CEO of property finance Deutsche Pfandbriefbank AG. Roman Heidrich, real estate appraisal expert at Jones Lang LaSalle, has considered that “most likely, as a direct reaction, most investment and modernization plans can be stopped immediately, with an impact on the management to long term of the affected properties ”. Felix von Saucken, residential real estate consultant at the Colliers International corridor, believes for his part that the expropriation of the living space will not create a single additional apartment: “On the contrary: the pressure will increase significantly. Many investors and real estate companies will avoid the German market. ‘

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