Text by Hans Wetzels
As in many cities around the world, rents in Berlin have risen spectacularly over the last years. After the privatization of large parts of the social housing stock, many apartments in the German capital are now owned by huge conglomerates. That, combined with the increasing popularity of living in Berlin, has put tremendous upward pressure on housing prices. As a result, original inhabitants are increasingly pushed toward the edge of town in favour of high-income newcomers, while traditional pubs and bakeries are forced to close shop quickly.
In response, a well-organized tenant's movement has been on the rise in Berlin. Having formulated one clear demand –expropriation of the biggest landlords in the city– the movement managed to force a referendum in 2021. The campaign has been so successful in communicating its message that tenants’ movements from around the globe have started to take notice.
‘The key to our success has been organizing people around a theme that concerns everybody, while formulating a goal that is achievable,’ activist Ian Clotworthy says. ‘That really convinced many people around town that political power can be built up if you listen and talk to each other.’and talk to each other.’
Popular Destination among Investors
Like in many urban centres undergoing a sudden shift, Berlin had to fully reinvent itself after the Wall came tumbling down in 1989. Formerly a city divided at the front line of a global conflict, suddenly cheap and often derelict houses became widely available in a wild anarchy that attracted artists, squatters and adventurers. For years, the future of Berlin was uncertain, and rents remained much lower than in any other mayor European city.
German reunification also brought back government services, big business, thousands of officials, politicians, lobbyists and parliamentarians. With a flourishing startup scene, tech giants like Amazon and Google trying to gain a foothold, and a surge in popularity among young people from over the world, Berlin has also become a popular destination for real estate investors.
In the late 1990s a bankrupt city government decided to sell of more than 300.000 units of its cheap social housing stock to avoid bankruptcy. Smart investors recognized that buying up municipal real estate at bottom prices, in a city quickly gaining in popularity, could yield hefty profits. As a result, many apartments in Berlin are now in the hands of big real estate conglomerates – of which Deutsche Wohnen is the biggest. According to its own annual report the company owns 114.200 houses in Berlin in 2020.
To take on a household name most Berliners know is exactly why the expropriation campaign Clotworthy works for was dubbed Deutsche Wohnen Enteignen (Expropriate Deutsche Wohnen – DWE). ‘Deutsche Wohnen already was the biggest single largest landlord in Berlin at the time our campaign started,’ Clotworthy says. ‘They themselves always stress they are not by any means the most expensive landlord. But they are big enough to have direct influence on policy, run legal departments and have lobbyists at their disposal. They will fight any attempt to constrain their profitability and power. Companies like Deutsche Wohnen are the main force driving up rents because they are obliged to continuously increase value for their shareholders.’
Business model
Clotworthy (37) is originally from Ireland. He has been living in Berlin for 12 years and knows what’s he talking about. As a student and activist, he’s involved in multiple movements in the political underground. He’s been with DWE since its inception in April 2018 and wrote an essay about it for the book ‘Degrowth & Strategy’, published late 2022.
In many parts of Berlin rents have doubled or even tripled over the last decade, making the city a prime example of urban dynamics seen all over the globe. Clotworthy orders coffee and cake in a hip bar in the central Prenzlauer Berg district: a noteworthy example of early gentrification. Deutsche Wohnen has become notorious for buying up property, only to structurally neglect maintenance, refusing to carry out repairs, and then renovating the whole building in order to be able to raise rents, he explains: ‘The business model of Deutsche Wohnen is letting apartment buildings decay and doing the absolute bare minimum in repairs, until it becomes economical do just plan a large scale renovation. The costs of which are then passed down to the tenants who often can’t afford the increased rent.’
German Constitution
The DWE campaign was launched in 2018 with the specific goal to force a referendum through a legal loophole the activists found in the German constitution: article 15 stating that expropriating land and natural resources is allowed in matters of public interest. ‘That article had never been used before,’ says Tilman Von Berlepsch in his office in the German parliament. ‘To force a referendum about that we had to collect 300.000 signatures in total. At the peak of our campaign, we had 2.000 people on the streets all throughout Berlin. We were very visible; we wore these bright purple vests and gave people the perspective that we could actually win this thing. The key always was to choose a radical slogan, and at the same time remain a friendly movement of normal people. We were in no way associated with radical political blocs.’
Von Berlepsch works as an advisor for economic policy for Die Linke. His office is on the third floor in an enormous complex housing one of the biggest parliaments in the world. The classic domed Reichstag building is connected to several other office buildings through a network of glass bridges and underground tunnels. Through its 2021 referendum the DWE campaign was able to officially call on the Berlin senate to expropriate all landlords with a portfolio bigger than 3.000 houses. That way a total of more than 200.000 apartments would have to be bought and brought under ownership and supervision of a new public institution controlled by tenants and the Berlin government directly.
Clotworthy: ‘This city has an unusually high proportion of people working in low-wage service jobs and the crisis is quite acute for a lot of us. Even though most countries don’t have constitutional articles like the one we based our campaign around, I still feel it’s important to find a specific legal strategy when setting up a campaign like this, and not put all your energy into demonstrations. Demonstrations are important to mobilize people, but not enough to force political change.’
Consolidation of Power
The referendum took place on September 26, 2021: 59 percent of voters voted in favour of the DWE-proposal. ‘That means most inhabitants of Berlin are in favour of the transfer of ownership of apartments from private companies to a new institution that would be governed democratically,’ Von Berlepsch says. ‘It has been two years, but the city government only formed an expert group consisting of lawyers to check whether the proposal was legally doable. Which, they had to conclude, was the case. And then nothing happened.’
Whilst, on the one hand the referendum did materialise, the consolidation of power on the Berlin housing market on the other hand, did progress. In 2021 Deutsche Wohnen merged with its direct competitor Vonovia (owning 43.000 houses in Berlin) – thereby creating the largest residential real estate group in Europe. The housing lobby itself stresses that expropriation will not change the lack of apartments available in Berlin and cites the explosive rise in land prices as the key problem causing Berlin’s housing crisis. A solution would be to more effectively designate land to residential building projects – not spending billions on expropriation.
Von Berlepsch admits Deutsche Wohnen and other big landlords would have to receive financial compensation and that might put great stress on the Berlin state budget – but that total sum might be less high than the housing industry now claims. In a response-move, Vonovia and Deutsche Wohnen together offered the city of Berlin the sale of 20.000 apartments for 2 billion euros as a contribution to rebuilding the municipal housing stock.
More importantly, research by the municipal investment bank IBB shows that supply and demand in Berlin are only well-balanced in the top segment of the housing market and that the amount of apartments available for lower incomes has only marginally increased. An imbalance that will not be solved by the proposals the housing lobby has put on the table, says Von Berlepsch: ‘We found out that the current conservative government in Berlin received over 820.000 euros just from one housing lobbyist. My guess is they are trying to pressure the government into ignoring the referendum altogether because it’s not legally binding anyway.’
Human Rights Law
The housing crisis is not an exclusively Berlin, German, or even European, problem.
* UN Habitat estimates that by 2030 there will be 3 billion people lacking access to adequate housing around the world, nearly double the figure in 2015
* 1.1 billion people live in informal settlements or in similar conditions
* Global housing costs have continued to rise since the onset of the COVID-19 pandemic, recent data suggests that 80% of cities worldwide do not have affordable housing options for half of their residents
* The countries with the highest housing cost burden –rent as a proportion of disposible income- are: Finland (31%), the Netherlands (30%), Norway (29%), Sweden (29%), Denmark (28%) and Iceland (28%).”
The European Federation of National Organisations Working with the Homeless (FEANTSA) calculated in its 2023 report that the cost of accommodation for poor households in the EU is alarmingly high in in Denmark (56.5% of household income), the Netherlands (48%), Sweden (44.4%) and Germany (43.8%).
In March 2019 the United Nations (UN) sounded the alarm over the growing influence of the financial sector on housing markets across the globe. A situation ‘inconsistent with international human rights law and the right to adequate housing’.
In the light of the international housing crisis, the expropriation campaign in Berlin has attracted attention around the globe as well. The group received requests for workshops from tenants’ rights groups from Mexico to South Korea. DWE itself is reorganizing and has raised 50.000 euros in donations to hire a law firm and start a new campaign for a binding referendum. Von Berlepsch: ‘During the last year rents have risen almost 30 percent. It’s safe to say the problem isn’t diminishing. At every new campaign meeting we see hundreds of new people present.’
Canary in the Coalmine
Berlin, in a sense, is the canary in the coalmine warning the rest of Europe, Melissa Koutouzis of the Woonprotest campaign in the Netherlands says. She lived in Berlin herself and has been active in the DWE movement. ‘Woonprotest in the Netherlands got off the ground in 2021. We organized big marches, wrote a manifesto, and formulated a list of demands. Some of them have been met by now, for example the abolishment of the tax levy on cheap housing. But land speculation is ongoing and the ban on squatting is also still firmly in place.’
Besides organizing Woonprotest in the Netherlands, Koutouzis also works for the Transformative Cities network: a platform set up by several civil society organisations to explicitly links housing movements in Europe and the United States with those in the global south. Its members list tenants’ campaigns from France and Spain, a cooperative development initiative in New York, a female worker association building homes in India, and a dispossessed community in Dar es Salaam financing its own resettlement campaign.
Groups that differ from each other but share a common goal and have much to learn from each other, Koutouzis says: ‘I don’t think there is a definite theory of change to cling to for everybody. In the Netherlands we have formulated demands that might sound radical within a centrist debate but are necessary to create affordable housing. We try not to forget to cherish our small victories, while at the same time planning our next to reach that goal.’
