Analysis | Bill of expropriation initiative
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Off to the next Berlin rental experiment
The initiative “expropriate Deutsche Wohnen & Co.” has presented a draft law to show how housing associations should be socialized. The project could be the next rental shambles. From Iris Sayram
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Especially now – this mood has prevailed among many tenants in Berlin since the Federal Constitutional Court took the rent cap with a fairly clear decision. In the latest Berlin trend on behalf of rbb and “Berliner Morgenpost”, the popular initiative “Expropriate Deutsche Wohnen & Co.” is supporting 47 percent of Berliners. This is an increase of 18 points compared to the previous survey on the topic from November 2019.
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Initiative makes projects more concrete
With the draft law presented on Monday, the initiative is now showing in more detail how the whole thing should work. At the center is the all-important question of costs. Because any expropriation would be unconstitutional from the outset if the question of compensation were not adequately regulated. One thing in advance: The compensation should not be paid in one fell swoop, but divided over 40 years, which alone raises concerns.
In paragraph 5 of the draft, the initiators write about the amount of compensation that they want to use the “affordable rent” for the value calculation. In other words, what households at risk of poverty could still afford, according to co-organizer Sebastian Schneider. That is a rent of 4.04 euros per square meter. The average rent at Deutsche Wohnen, however, is significantly higher per square meter: namely 6.53 euros according to the 2020 annual report.
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Estimates of the amount of compensation vary widely
This so-called “fair rent model” may be balanced from the tenant’s point of view. However, there could already be problems here with the constitutional requirements. Because what the initiative envisions is well below the market value of the property.
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It is true that the Basic Law does not necessarily provide for compensation for the market value – i.e. a kind of financial replacement that reflects the market value. Nevertheless, it demands a value “to be determined by just weighing the interests of the general public and those involved”, the Federal Constitutional Court once decided. What is still affordable for tenants at risk of poverty might not be the only yardstick.
The bill assumes around 240,000 apartments. For this, the initiative expects compensation of 7.3 to 13.7 billion euros. According to the initiators, it could refinance itself entirely from the rents, so that the Berlin state budget would not be burdened. However, this presupposes that the compensation just applied by the initiative is not objected to under constitutional law.
The official estimate, however, is higher: “For a socialization of 243,000 apartments, compensation costs of 28.8 to 36 billion euros and ancillary acquisition costs of up to 180 million euros are estimated,” says the state return officer. There are also additional costs for management, for example.
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Already 175,000 signatures together
In addition to the still unmanageable costs, new legal territory is being entered here again. In formal legal terms, the project does not relate to expropriation, which is regulated in Article 14 of the Basic Law; but on a socialization, which is one number further in Article 15 of the Basic Law.
The difference: Article 14 is more aimed at individual assets, the socialization wants to transfer the big picture – i.e. the whole company – into the public economy. “In practice, the authorization to socialize has not been used in any case,” writes the Bundestag’s scientific service in an analysis. There are no comparable cases. It is unclear whether living space is “socially acceptable” at all.
None of this deterred the initiative. “Today we only made one proposal with the bill,” said initiator Schneider to rbb | 24. “If we discover in the course of the debate that this is not sustainable, we will take action.” It is well on the way to get the 175,000 signatures required by June 25th so that the referendum will then become the actual referendum, which the Berliners will then vote on.
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In the end, there is no new living space
The law that has now been presented will not be put to the vote if there is a referendum on September 26th. According to the initiators, the “decision-making referendum” sought from the start remains with which the Senate is only asked to act and to draw up its own law.
“As commendable as the efforts to formulate a law of our own, they could contribute to confusion among the population,” says constitutional law expert Christian Pestalozza. After all, the initiative has so far been concerned with the Senate submitting a bill. That was much less ambitious, he said rbb | 24. Pestalozza therefore asks: “Will those interested still know what they should vote for?”
Should there be a successful referendum on September 26th, the House of Representatives would not be bound by the law presented on Monday. It should be exciting to see how the next Senate will implement the project.
But one thing should be clear: as praiseworthy as the goals of the initiative are, it will not create more apartments.
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Broadcast: Inforadio, May 10th, 2021, 2:20 pm
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