Germans up in arms over ‘rent insanity’
BERLIN: Michaela Franz initially thought she was spared sharp rent hikes when her new property owner scrapped plans to renovate the building she has lived in for a decade here.
In fact, something worse was brewing. A few days later, she received a letter notifying her that her rental contract had been terminated and that she would have to move out by the end of May.
For the 58-year-old, the landlord’s intention was clear: kick out long-time tenants and build new luxury apartments that fetch higher rents.
Not only here, but across Germany, Franz’s experience has been playing out.
And the wave of gentrification and rising rents is provoking rising anger and leading some to even ponder radical solutions like expropriating housing from institutional landlords.
Tens of thousands of people joined marches against “rental insanity” (Mietwahnsinn) yesterday in cities like Munich, Cologne and Frankfurt.
The problem is most acute in the capital, where rents have doubled over the past decade.
Average rent prices here have pushed past €10 (RM46) per square metre per month, according to a recent study by real-estate group CBRE Berlin and mortgage bank Berlin Hyp AG.
As property prices here traditionally lag behind those like Paris and London, investors have also swooped in, betting that the real estate boom was only just starting. But a popular backlash appears to be growing, and organisers of an initiative to requisition housing from real-estate groups will begin collecting signatures in their push for a referendum on the issue.
Campaign spokesman Rouzbeh Taheri said the movement had radicalised as government measures to cool the property market had failed to work.
“Many say this is a type of class struggle. Yes that’s what it is.
“But we did not start it. We’re taking defensive measures against the class struggler from the top, who has for years been fighting against tenants.”
The “Expropriate Deutsche Wohnen & Co” initiative, named after the biggest private player here, targets companies with more than 3,000 apartments.
Of an estimated two million rental apartments in Berlin, Deutsche Wohnen owns 111,500, followed by Vonovia with 44,000.
Taheri argues that cutting them down to size would strip them of the influence they wield in deciding market prices.
“It’s about sending a signal on which direction the city wants to go. And a signal to speculators telling them that your capital is not safe in Berlin,” said Taheri.
But critics question whether the private groups really wield that much influence.
Calling the initiative “completely absurd”, Harald Simons, an economist at Leipzig University, noted that 70 per cent of rental apartments across the country are owned by small landlords, who each hold between two and 20 apartments.
Singling out the big groups would “mean that about five per cent of Berlin tenants will suddenly not have to pay much while the rest would have to keep paying just as much”, he said.
The extreme move could also scare off investors who want to move their businesses here and create new jobs, critics say.
Further, taxpayers face a huge bill — city authorities have estimated the cost at €36 billion.
“When people learn about how many billions this will cost, many would see this differently,” Berlin Mayor Michael Mueller said.