Berliners have voted to forcibly buy housing owned by large property companies in the German capital in a bid to combat rising rents. 

While delegates at the Labour conference have been debating rent controls in Brighton, Berlin tried and failed to establish a rent cap in January 2020 – but this step is an even more dramatic approach.

If approved, Berliners’ vote to take public ownership of private property could have ‘worldwide ramifications’ and set a precedent for similar initiatives worldwide.

The non-binding referendum, which got 56% support, would mean the local government would buy 11% of the city’s properties to make housing more affordable by transferring about 226,000 apartments into public hands.

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The proposal applies to property companies that have more than 3,000 rental units, however Deutsche Wohnen, which owns more than 100,000 units in the city, says it doesn’t expect the transfer will happen, and that such a move would be ‘unconstitutional’.

Tied up

The firm says: “Funds and resources would be tied up for decades in compensation payments and thus be lost to the construction of urgently needed housing and further investments in the infrastructure of the growing city.”

More than 84% of the population of Berlin are tenants and are paid an average salary lower than other major cities, yet rental prices have increased markedly in recent years.

The neighbourhood of Mitte is the second most unaffordable neighbourhood in Germany, according to estate agent Homeday.de, where someone earning the average salary would need to spend 61% of their net income on rent.

It says a rental burden of more than 40% of the household income is defined as financial overload, meaning that the average earner is priced out of 17 out of 19 Berlin neighbourhoods. 

10 COMMENTS

    • You say don’t worry, but Labour’s John McDonnell and his leftie cabal are all for a tenant’s right to buy privately rented homes. His plan is to offer the house at a discount to the tenant with the discount funded by the tenant sharing in the capital gain between the landlord’s purchase price and the current market price. Any discount would be based upon how long the tenant had lived at the address. When suggested in an interview this rode rough-shod over landlords’ property rights, he insisted it would be viable under compulsory purchase regs. If we end up with a hard left Labour leadership, for example Rayner or perhaps Andy Burnham taking over , I’d argue such a proposal could be on the cards.

  1. Let’s be clear, the government or anyone, in fact, could buy these properties simply by offering the owners enough money. Of course, I’d sell mine if offered a good price!

    So what we’re talking about here is compulsory purchases at LESS than market rates. Also called theft.

    • But this “theft” is the only way to combat the monopoly these companies are holding.

      People shouldn’t have to be spending over half their wages just for shelter. That not living, that’s surviving. The rent costs are only so high because of an artificially low supply owing to companies like those in the article hoarding them. How can anyone ethically own 100,000 properties?

  2. Writing is on the wall.
    The Tories will enact the looney left policies.

    By the Tory introduction of bonkers anti-LL policies being a LL is being rendered unviable.

    Make no mistake the Tories are still seeking eradication of small mortgaged LL.

    I’m surprised the BTR operators AREN’T of a nervous disposition with what is occurring in Berlin.

    They could see their properties Nationalised.

    Not sure investors would wish to invest in such a dodgy situation.

    To reduce business risk LL would do well to pay down as much mortgage debt as possible.

  3. looney idea, you buy house from landlord then offer discount of 50% to first-time buyer. Most of these people cant afford a mortgage, so after subsiding the tenants then the they claim housing benefit so then the government pay their mortgage. after landlords have left the market how will they finance these perks. Cant see big cooperate investors to give these houses away for loss. The government have got enough finances to run essential services where are they going to find extra funds the finance these looney ideas. Race to bottom .Encouraging people to stay on benefit and not work. Most of people on work benefit only work part-time so they can keep on receiving the benefit.

  4. I think its a daft idea, then they won’t have us running around after them supplying and fixing everything for free we are un paid Labour.
    What are the Councils going to do without the millions from the HMO racket, the claw backs, penalties and spurious fined, especially now the call rent the proceeds of crime.
    Currently Private LL’s finance and supply housing for millions of People at no cost whatsoever to Government, pay billions in taxes, gets fines, penalties and a criminal record as a reward.
    Bring it on 5’500’000. on universal credit, over 3’000’000. on housing benefits, keep them all who are you going to get the money from when we are gone . Lol

  5. They couldn’t even control Petrol/diesel sales all they had to do was prohibited sale to anyone with half a tank or more, so easy to do and Police all garages have ANR, garage would have to comply as well so they wouldn’t has discretion, any driver misbehaving get penalty from Police through the post. Portable petrol cans restricted to 5 litres max. I could go from London to Birmingham and back on half a tank and not be short. How far are they going doodling around Town or parked up with a full tank, now calling in the Army some nonsense going on.
    They had no problem taking swift action making an Order stopping LL’s from evicting anyone go six months did they.

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