Berlin landlord expropriation would not fix housing shortage, Kiel study finds
A Kiel Institute study says expropriating Berlin's large landlords would not ease the housing shortage and could make the rental market more rigid.
Expropriating Berlin's large residential landlords would fail to relieve the city's housing shortage and risks making its rental market less flexible, according to a study by the Kiel Institute for the World Economy published on Tuesday.
The proposal has gained political momentum behind Elif Eralp, the far-left leader campaigning to become mayor of Berlin, who has pledged to take over more than 200,000 housing units from corporate landlords. The party recorded its best result in the German capital in this month's election.
The study estimates the market value of the affected housing portfolios at €40.2 billion ($45.6 billion), though compensation could amount to roughly half that figure.
According to the institute, if the funds needed to compensate companies such as Vonovia were instead directed into construction, Berlin could add as many as 71,000 apartments by 2045. Asking rents could then be up to 8.7% lower than levels otherwise expected by that year.
"What matters is not who owns the apartments, but whether new ones are being added," said co-author Jonas Zdrzalek.
The study also warns that state ownership would deepen the gap between tenants holding regulated existing leases and prospective renters, reducing mobility and worsening inefficient use of housing.