Almost always when we talk about displacement in Berlin, someone at some point says: “and then the new owner showed up.” Social scientist Andrej Holm summarizes the status quo of Berlin’s housing market – a story that has so far too often focused on privatization, gentrification, and neoliberalism while talking little about the residents themselves. This raises the question whether the demands of tenant associations can after all contribute to a happy ending.
For years, rent in Berlin has only known one way: up. Revaluation and displacement do no longer apply just to hip and trending neighborhoods, but have become common in large parts of the city. Gentrification has become typical and rent increase can no longer be traced back to cultural revaluation or a changed lifestyle in particular areas. If you cannot afford the rent you hardly stand a chance to find housing in Berlin. It therefore comes as no surprise that tenant associations and more than 100 housing communities try today to defend their right to housing and advocate a socialization of housing provision. At the same time, however, the housing market lobby and part of the political landscape know only one solution: “Build, build, build!” And yet the increasing rent in existing structures, the displacement through modernization announcements, and the conversion into condominiums cannot solely be explained by the lack of housing. Affordable rent for households with a lower income will not emerge through the invisible hand of the market, but will have to be maintained through rent control and must be actively created through the expansion of communal housing stock.
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The last ten years have shown why investors are excited about the changes happening in Berlin: increasing rental income, higher sales profits, and a booming real estate market have transformed Berlin’s housing market into a gold mine for investment seeking capital. Between 2008 and 2018 alone the average rent – including rent prices in apartments with old rental contracts – increased by 37 percent (from 4,79 €/m² to 6,56 €/m²). These rental developments are, especially for households with a lower income, tied to a considerable increase in the tenants’ rental cost load. Already today, this load amounts to an average of 32 percent in Berlin – while it is generally assumed that apartments are affordable whenever rent including heating and utilities do not make up more than 30 percent of the tenant’s income. This shows that for more than half of all Berliner households the comparatively affordable rent of older apartments is already too expensive.