Nationalization of housing owned by large companies in Germany: who benefits from it?

Recently we could observe massive support for expropriation of previously privatized apartments in Germany. A referendum was held in Berlin which managed to obtain the required number of signatures rather quickly. After that, the issue was brought up for consideration by the state authorities.

Campaign for nationalization of housing in Germany: its features and current state

The nationalization policy does not apply to the owners of one apartment or house, and will not even affect those who have several real estate objects. This campaign applies to large companies with several thousand apartments on their balance sheets. First of all, we are talking about the joint-stock company Deutsche Wohnen AG. Owners of the company lease over 100,000 residential properties in Berlin alone.

The main reason why residents of different countries took protests to the streets and began to ask for nationalization was the increase in rent from landlords. Part of the country's population saw the solution to the problem exclusively in immediate expropriation. But at the same time, many people found echoes of a socialist society in the protests, and therefore the society was divided.

How big of a change can one observe in rental prices?

Quite a large number of German residents prefer to rent housing rather than buy their own property. This is due to both historical reasons and modern realities - the need to live near an office, school or university. Therefore, any changes in the rental market hit quite hard across the country.

In such situation, we can outline the following conditions:

• in a situation of increased demand for rental housing, the number of new properties in the country is growing rather slowly;
• state authorities do not pay enough attention to the construction of social apartments that could fill an empty niche;
• as a result, in recent years the average prices of rent has grown by more than 70%.

At the same time, many private companies are actively occupying this market, building apartment buildings for rent. Such objects are in high demand among investors, including foreign buyers, as they allow them to recoup their investments sooner rather than later.

How does the government react?

The authorities can also be blamed for provoking such a situation. Previously, it was the government that gave privileges and subsidies to private developers if they were engaged in the construction of social apartments. However, after the expiration of the contract with the government, lease terms have changed a lot and today such housing can no longer be called “social”. In addition to that, during a certain period of time the authorities of different cities in Germany actively adopted campaigns allowing the privatization of objects. Back then it was a required measure, since the country had to repay its international debts.

Today, all this has led to massive protests and a tense situation among the residents of the country. Government reacts in different ways. Some politicians categorically refuse the idea of ​​expropriation. There are also those who perceive such actions as populistic. But there are some politicians who support the campaign. How exactly the current situation will be resolved is yet to be observed.