Can socialization fix Berlin’s housing crisis? | DW News

Summary

Berlin’s housing crisis—marked by high rents and difficulty finding a flat—has put a proposal to transfer some large landlords’ apartments into public ownership at the center of coalition talks. The idea follows a 2021 referendum in which a majority of Berlin voters supported socializing about 240,000 apartments, though the vote was non-binding and no transfer took place.

The current proposal is narrower: it would target around 160,000 apartments owned by large private companies with more than 10,000 units. That is roughly 8% of Berlin’s housing stock. Supporters say public control could slow rent increases and give tenants greater security. They argue that large companies have not been the main source of new housing, while Berlin has sold off more than 300,000 publicly owned apartments over recent decades.

The plan raises legal and financial questions. Germany’s constitution allows socialization under Article 15, but the provision has never been used, and the meaning of fair compensation remains unsettled. A 2023 expert commission found the measure legally possible, but court challenges are likely. The proposed compensation cap is €16 billion—potentially below market value, yet still a major cost for the city. Supporters say the cost could be repaid through rents over time; critics question whether Berlin can make the plan affordable without taking on substantial debt.

Critics also warn that rent relief for tenants in public housing could leave the rest of the market under greater pressure, creating a two-tier system. They argue that uncertainty about expropriation may discourage investors whose capital Berlin needs to build homes. Supporters counter that claims of investors being deterred are not yet conclusive and say private investment will follow opportunities to make a profit.

Both sides agree that socialization alone would not solve the shortage. The wider plan includes issuing 100,000 building permits over five years, an ambitious construction program that would depend partly on securing investment. Germany’s federal government has signaled opposition, and legal disputes would likely delay any results for years. Whether the proposal proceeds—and whether it helps ease Berlin’s housing pressures—remains uncertain.

Presenters and Contributors

• DW presenter/narrator: Not identified in the subtitles
• Matthias Dolls: Economist
• André Holm: Housing sociologist and activist, and former Berlin state housing secretary