The end of the CDU’s dominance in recent elections was the headline result in Germany’s weekend elections, but in Berlin, residents were also scheduled to vote on whether to nationalize over 200,000 privately held homes. As expected, the measure passed, with 56.4% of voters calling for the city to expropriate units from landlords that own more than 3,000 of them. To ensure the landlords don’t make a profit in the process, they would be compensated at a rate “well below market value.” With its portfolio of more than 110,000 residential units, Deutsche Wohnen is seen as the obvious target of the organizers. But the vote has sent shock waves across Europe, helping feed rhetoric in the Czech elections over the growing red threat.
While it’s made for a great spectacle, the vote does not have the force of law and appears unlikely to lead to the privatization of a single flat. Berlin’s senate controlled by the Greens, the Left party and the SPD, will have to deal with the issue. But only one of the coalition members is a staunch advocate of passing legislation to privatize flats (the Left party) while the SPD (and all the opposition parties) are against it. Even they passed such a law, there’s a strong chance it would be shot down in the courts. That was the fate of a law passed to cap rents in the city which the Federal Constitutional Court shot down in May. Legal experts also believe that the city could end up having to sue the landlords for each individual property, an absurdly expensive undertaking.
Even if no flats are ever expropriated, however, this vote is not a ‘non-event’. Any issue favored by 56% an electorate is going to be used for political gain sooner rather than later. Ignoring the residential crisis is not a long-term option, even if there is no obvious solution for it anywhere in Europe.
Also in ThePrime