Wednesday, April 13, 2016

German Housing Fix, Number 44?

Discussions are underway by the German Federal Justice Minister (Maas) to possibly restrict what a landlord can do in terms of raising the rent, if he has modernized or renovated a building or apartment house.

The deal?  A lid on rent increases.  It'd amount for a maximum of three Euro per square meter higher (with a limit of eight years on what you make the rent), so if you had a 80 square meter apartment (2 x bedrooms), then then the rent could go up 240 Euro.

You can figure the math.....a 750 Euro apartment presently.....it go up to almost 990 Euro.  A hefty amount, no matter how you view it.

The thing, there's lots of anger on both sides.  The renter associations think it was too generous.  The landlord associations think that this is getting to a point of preventing new construction or renovation.

Over the past three years, it's almost weekly that some state-run network will carry some short news piece about affordable housing in the major urban areas.  There just isn't anything in most cities like Mainz, Berlin, Frankfurt, etc.  If you go out forty kilometers.....it's a different story, with empty houses and apartments sitting there but it's way too far for most to fight traffic and make way into the urban area.  Maybe twenty years ago, if someone had seen this event approaching.....there would have been more state money put into mass transit and getting ways for rural areas to fit into a nearby urban zone.

In a way, it's like a guy with an Italian car and trying to get some problem fixed, and four master-mechanics working on the issue....with each seeing a different approach to what they think the problem is and how to fix it.  This housing issue, in my humble opinion.....simply gets worse as each "fix" is applied by the German federal government.

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