Law & Politics
Berlin housing policy 2015
Berlin rent referendum: Senate estimates costs at 3.3 billion euros
Berlin's Senate administration put the cost of the rent referendum proposals at 3.3 billion euros through 2021. The first year alone would have required 791 million euros.
Peter Guthmann
The debate over affordable apartments in Berlin gained a concrete figure in 2015: the Senate Department for Urban Development and the Environment published an official cost estimate for the rent referendum. The result: 3.3 billion euros through 2021, including 791.3 million euros in the first year of implementation alone.
What the initiative demanded
The referendum's draft law envisaged several measures: the state of Berlin would actively build affordable housing, a revolving fund would finance social housing construction and rents in subsidised apartments would be tied to tenant incomes. Grants for accessibility and energy efficiency were also planned, without placing a heavy burden on tenants. The city's six municipal housing companies would be converted into public-law institutions with expanded tenant co-determination.
3.3 billion euros: the Senate's calculation
The cost estimate covered the period 2017 to 2021. It included subsidies for new construction, rent reductions in the existing subsidised stock and the creation of new institutional structures. Critics of the referendum used the figure as evidence that the plans would have overwhelmed the state budget. Supporters countered that affordable housing in a growing city requires investment.
Implications for Berlin's property market
Although the measures focused on municipal and subsidised housing, implementation would have changed the regulatory environment for the entire market. Converting municipal companies into public-law institutions could have set a precedent. The financial burden on the state budget might have led to cuts elsewhere. For investors in tight markets like Mitte or Friedrichshain-Kreuzberg, the growing regulatory uncertainty would have influenced market trends.
What happened next
The initiative first had to collect 20,000 signatures by the end of May 2015 to launch the referendum process. The Senate's cost estimate became the central counter-argument in the public debate. The referendum ultimately did not take place, but the discussion about state intervention in Berlin's housing market continued in the years that followed.