Capital Always Wins: Berlin's Housing Referendum

Sara Nur Yıldız

May 9, 2022


Like most other cities throughout the world, Berlin is experiencing a housing shortage along with an unprecedented rise in the cost of renting and sky-rocketing real estate prices. As the hottest real estate market in Europe at the moment, however, Berlin is hit particularly hard by how fast this is occurring. Around €42 billion has been invested in Berlin real estate between the years 2007 and 2020 – amounting to more than that invested in Paris and London combined for the same period. Since Berlin is largely a city of renters, with the second-largest percentage of renters (82.6%) in Europe (Zurich comes in first), residents of this city are particularly vulnerable to becoming precariously housed. One must add to this that many middle-class Berliners are precariously employed and underpaid since wages in the city have remained stagnant even as rental costs have risen.


Yet, Berlin is unique among global cities. And not because it is ‘poor but sexy’ (arm aber sexy), as per the neoliberal slogan of governing Mayor Klaus Wowereit (2001-2014), in order to advertise the city’s cultural attractions while glossing over its impoverishment. Rather what sets Berlin apart from London and Paris is its history as a marginal space during the Cold War years. With its tradition of squatting and leftist movements, Berlin housing activists lead the world in the struggle against corporate real estate capture of the city.


In the past year, an immense victory was won by Berlin activists with the passing of a city referendum calling for the expropriation and resocialization of corporate-owned real estate in the September 2021 elections. Organized by the Expropriate Deutsche Wohnen & Co. initiative, named ironically after the largest real estate company in Berlin, the referendum aimed to expropriate and resocialize, in one fell swoop, around 240,000 apartments for the public good. Specifically targeted are private companies that own more than 3000 apartment units. This amounts to more than ten percent of the entire apartment stock in Berlin. The referendum is believed by the organizers to be legally tight. It is based on Article 15 of the Basic Law of the German Constitution, which stipulates that “land, natural resources and means of production may…be transferred to public ownership” in the public interest. Adopted in 1949 with the founding of the West German state, Article 15 was long forgotten during the Cold War with its tensions between capitalist West and communist East Germany.


Victory?


International commentators from the left have expressed much enthusiasm over the referendum. Considering it “a potential watershed moment beyond Berlin,” and “catalyst for municipal housing movements across Europe,” Alexander Vasudevan, associate professor in human geography at Oxford, praises Berlin’s referendum for highlighting “the role that ordinary tenants – and grassroots organizing – can play in developing policies for affordable housing while supporting communities increasingly at risk of displacement.”


Despite the high hopes expected from this initiative, the referendum victory in the ballot box will most likely remain symbolic. With the Social Democrat Party’s (SPD) victory in the German elections, and the appointment of the SPD’s Franziska Giffey as Mayor of Berlin, the non-binding referendum is unlikely to be implemented. Giffey herself has expressed her strong opposition to any kind of expropriation, although she has stated, rather disingenuously, that she will respect the result of the people’s vote. Andreas Geisel, the SPD senator in charge of urban development and housing,