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Berlin to vote on radical bid to combat housing crisis

Berliners are to vote on a referendum to force major property companies to sell thousands of their flats to the city, officials said Thursday as the election-year issue of high rents grows more charged.

Berlin to vote on radical bid to combat housing crisis
Supporters of Expropriate Deutsche Wohnen & Co earlier this week. Photo: picture alliance/dpa | Christophe Gateau

A grassroots petition campaign fuelled by anger over surging housing costs submitted 183,711 valid signatures, “more than the total required” of around 172,000 to put the question to a general ballot, the Berlin election supervisor said.

Local officials must now set a date for the vote, which is widely expected to be held on September 26th, the same day as the elections for a new federal parliament and Berlin government.

The “Expropriate Deutsche Wohnen & Co.” initiative, named after Berlin’s biggest property group, targets companies with more than 3,000 apartments in their portfolios.

The movement would like to see more than 240,000 homes placed under a public agency to be administered “democratically, transparently and in the public interest”.

READ ALSO: ‘Stressed and depressed’: How Berlin’s rent cap fiasco has affected foreign tenants

In a city of 3.7 million residents where more than 80 percent rent their homes, the capital’s attractiveness to investors and structural lack of housing sent prices soaring by nearly 85 percent between 2007 and 2019.

Berlin’s city-state government already moved to freeze rents for five years from 2020 in a bid to halt runaway gentrification, but the federal constitutional court ruled that policy to be illegal in April.

“Expropriate Deutsche Wohnen & Co.” bases its claims on Article 15 of the German constitution, which stipulates that “land, natural resources and means of production may…be transferred to public ownership” in the public interest in return for compensation.

Adopted in 1949 with the founding of the West German state, the article was long forgotten during the Cold War with its tensions between capitalist West and communist East.

Deutsche Wohnen owns around 111,000 of an estimated two million rental apartments in Berlin and in May announced plans to merge with fellow real estate giant Vonovia.

It has sharply criticised the initiative’s aims as counterproductive “because it doesn’t create a single square metre of additional living space”.

“We need more housing built to ease the market pressure, that is why we will be stepping up building in the coming years in Berlin,” a company spokesman told AFP.

And the city’s Social Democratic mayor Michael Müller has also rejected the referendum, arguing that he would prefer “partnerships with the private sector” to build more housing.

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PROPERTY

Where in Germany can you still snag a home for under €100k?

Real estate experts are warning ever more urgently of a property market bubble in Germany, as prices continue to balloon despite rising interest rates. But some parts of the country are still remarkably cheap.

Where in Germany can you still snag a home for under €100k?

If you are thinking about buying your own house in Germany on a tight budget you can forget about the big cities. Even their metropolitan areas are probably out of your reach.

We decided to look at where in Germany you could afford a property on a budget of €100,000. 

To make sure you’re not just getting a shoe box for that money, we also specified in a search on the property website Immobilienscout24 that the property should have at least five rooms and a floor space of at least 130 square metres.

The website, which displays offers from estate agents as well as private individuals, came up with 134 properties currently on the market across Germany.

‘Hidden gems’

What was revealed was a small cluster of properties in and around the small state of Saarland on the French border, while almost all the other properties were in east Germany.

In large swathes of wealthier western Germany there was absolutely nothing to be found in this price range.

Urban properties such as this Altbau in central Munich can’t be found for a bargain. But nor can homes in commuting distance from the major cities. Photo: dpa-tmn | Karl-Josef Hildenbrand

Both Bavaria and Baden-Württemberg, two of Germany’s richest states, had next to nothing on offer. That also goes for the a region of the west of Germany stretching from Cologne all the way up to the Danish border.

Even Brandenburg, once a paradise of cheap properties, is now a barren wasteland when it comes to bargain basement offers, due to the recent surge in interest among Berliners in homes in the surrounding countryside.

A small cluster of “hidden gem” homes could be found in the west in the small state of Saarland. As a former mining region, Saarland is one of the poorer parts of western Germany, but it is also famed for its beautiful Saar river and is close to the wine regions of the Mosel.

Anyone who fancies buying themselves a property just a stone’s throw from the French border should be warned, though.

SEE ALSO: How real estate in Germany has rocketed in the pandemic

Of the nine properties currently on the market in our filter, almost all come with words like “renovierungsbedürftig” (in need of renovations) or “für den Handwerker” (for DIY lovers) – both clear indications that you’ll have to invest quite a bit more money and time into the property before it’s in a condition that you could contemplate living in. For those of you who like nothing better that spending a Saturday afternoon in your local Baumarkt, these could be just the properties for you though.

The rest of the properties were spread across a belt of the country that starts in Lower Saxony and stretches southeast to where Saxony buts up against the Czech border.

The village of Seiffen in the Ore Mountains. Photo: dpa-Zentralbild | Hendrik Schmidt

Twelve of the properties turn up in a single district alone – Vogtlandkreis in southern Saxony.

In terms of salary levels, Vogtlandkreis is one of the worst off places in Germany, so it would make sense that its property market is also on the affordable side. But it is also nestled inside the Ore Mountains. Its national park could offer ideal refuge to those looking to move to a place that offers snow in the winter and long summer hikes.

Generally, the properties on offer are in small villages, but this isn’t always the case. One unusual property to crop up was a “city villa” with 13 rooms in the town of Zeitz in Saxony-Anhalt. 

Energy catch

Another thing that you should be aware of when thinking about buying a home on the seriously cheap side is the exorbitant energy costs that are likely to come your way once you’ve moved in.

Almost all of the houses that turned up in our filter, over half of them (70) had an energy efficiency class of H, which is the worst possible classification for energy efficiency in Germany.

Consumer watchdogs warned back in 2019 that you are likely to pay energy costs upwards of 13 euros per square metre for a home in the H energy class. That equates to utility bills of at least €1,690 each year. By comparison, a home in the energy category D has estimated energy costs of €6 per square metre.

And that number is likely to be much higher now due to the energy crisis caused by the conflict in Ukraine.

Only four of the properties in our search had an energy class of C or above.

SEE ALSO: Where you’ll find Germany’s most expensive apartments

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