News Senate misses its own goals

Senate misses its own goals

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What do the six state-owned housing associations in Berlin do for the existence and expansion of rental housing for low-income households? On Monday, Senator for Urban Development Katrin Lompscher (left) presents her report entitled "affordable rents, new housing construction and social housing provision". The bottom line is sobering: given the policy requirements for persistently low rents, the Senate's ambitions for new housing construction are hard to manage and pose high economic risks for urban businesses.

If the Senate does not provide the six state-owned housing companies with building land, the political goals for massive expansion of the stock of communal housing are unattainable. Its growth is already much slower than hoped in the coalition agreement of red-red-green: End of last year, the six companies together had a good 306,000 apartments – in two years it should be 360,000, which is considered unattainable. On the other hand, the Senate is clearly on course for its reorientation towards social goals. This is from the report "affordable rents, new housing construction and social housing supply", which Senator Katrin Lompscher will present this Monday.

The Senator herself takes "a positive balance" in the report: More than 60 percent of the country's homes have been re-rented to low-income households. It had been bought twice as many apartments as in the previous year (3419) and 3279 newly built. The construction of 5 727 apartments was started, 15 percent more than in the previous year. Overall, the six companies plan to build 49,000 apartments spread over 390 projects.

The political steering of the six companies is taking a social course: The rents of the 306,000 apartments rose on average by only 1.3 percent, which is even less than the upper limit agreed in the "Cooperation Agreement" with the Senate (two percent). And the average rent in the state-owned companies is 6.09 euros per square meter under the Berlin rent index (6.49 euros). The companies are becoming more vigorous when an apartment is rented out and re-rented: they average 4.8%, and yet the companies also offer these apartments significantly (minus 30%) below the market rent: for 7.43 euros per square meter.

The reserve of under-housed apartments remains

However, the economic dilemma of the six companies in the report is clear: the political requirements are not or only in pain to achieve the new building and are therefore probably missed: The set by Lompscher "upper limit" of 10 euros per square meter rent for new buildings without social commitment are "easily or significantly exceeded (by up to just under € 1.90 per square meter)". It goes without saying that new buildings can not be built at a cost of less than 12 euros per square meter, as the industry says. Therefore, it is unclear how the companies should meet the political requirements, without systematically accumulating uneconomic construction projects.

In vain was the endeavor to lift the vast reserve of vacant flats. Purely mathematically, the construction of tens of thousands of flats could be dispensed with, for example, when single seniors would exchange their large "family flats" with young families who expect a child and grow up. Only 146 removals took place, although the Senate had set up an online exchange specifically for it.

(In our people's newsletters from the twelve Berlin districts, we regularly deal with topics such as housing and renting.) You can order the newsletter here for free: mensch.tagesspiegel.de)

The companies have missed the goals in the new building: every second newly built apartment should be socially bound, which was not successful in the 2018 started construction projects. Of the total of 3,279 completed apartments, just over one fifth (26.9 per cent) were social housing, less than in the previous year (2017: 28.2 per cent). The first step was to buy rental houses: the six companies acquired 3,419 apartments, twice as much as in the previous year, with district pre-emption rights minimizing the controversy over the topic (168 apartments).

Hardship case, if the rent exceeds 30 percent of the income

The state-owned companies owned a good 306,000 apartments at the end of the year. According to the agreed "Roadmap" of May 2016, this stock should rise to 360,000 apartments by the year 2021. This goal is unlikely to be met, since not all of the currently only "in planning" construction projects are sufficient and only the construction time of residential buildings takes almost two years.

In addition, the companies lack real estate. In the annex to the "Cooperation Agreement" states: "In order to achieve the growth target of 2021, it is necessary that building plots are available in sufficient numbers." Although the country has meanwhile transferred construction land to the companies, but whether these are sufficient, is very uncertain.

The six companies sent just under 4,000 rent increases due to the modernization last year, a third more than in the previous year. For every sixth household, the companies concluded "individual modernization agreements" to limit their financial burden. In any case, a rule of hardship applies to tenants of state-owned companies if the rent exceeds 30 percent of disposable income, which was used 292 times and led to reduced rent.

Ineffectively all offers remained in 3347 cases, where the rent debts accumulated so that the companies had to pronounce without notice terminations. In four out of five cases, companies continued to offer advice to the defaulting tenants, which led to the withdrawal of redundancies in half the cases. Only in every tenth case was every help in vain and led to 311 forced evictions.

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