Regierungsbildung: Vergesellschaftung soll kommen – was könnte sie bringen?

In a recent development in Berlin, the left-wing parties of the city have announced a plan to potentially acquire and manage around 160,000 apartments from five major real estate companies through a process called "vergesellschaftung." This proposal, put forth in a joint policy paper, could become a reality under a coalition government comprising the left, Green, and Social Democratic (SPD) parties.

The three parties have agreed to a plan to transfer about 160,000 apartments from five real estate corporations into state ownership, with the compensation for the corporations capped at 16 billion euros, financed through loans and refinanced via rents. Private firms with a stock of 10,000 apartments in Berlin are targeted, while retaining a core stock of 10,000 apartments.

Cooperatives and benefit-oriented companies are excluded from the measure. The plan is projected to be implemented by mid-2028, with a proposed law to be presented by late 2028 to come into effect a year later. The primary aim of the proposed measure is to expand the communal housing stock and gain more influence over rents in the city.

The left argues that low rents in municipally-owned housing would dampen the overall market, thereby affecting the "mietspiegel," which sets the standard rent in Berlin and forms the basis for allowable rent increases. Economists, however, criticize the plan, arguing that it would not create new housing, deter investors from investing in new housing, and be financially unsustainable.

Konstantin Kholodilin from the German Institute for Economic Research (DIW) estimates that annual payments for interest, repayments, and maintenance could amount to 740 million euros, with additional administrative costs of 3.73 euros per square meter per month, making it necessary to charge 9.78 euros per square meter per month to cover these costs without subsidies.

Current average rents in the affected apartments stand at 8.26 euros per square meter net of costs. The plan is also accompanied by other measures aimed at curbing speculative rentals and enforcing existing regulations, including a new rent control regime, a dedicated department within the Berlin State Prosecutor's Office, and accelerated approvals for new housing projects.

The left had initially planned to target corporations with a stock of 3,000 apartments, which would have affected approximately 240,000 apartments. However, the current plan only targets firms with a stock of 10,000 apartments in Berlin.