Berlin Story

 If you live within the city of Berlin....on the 26th of September, you will be voting on a referendum as well as the federal election and city election.  RBB (public TV for Berlin explains the details) is worth a read.  

The referendum?  

There is a housing/apartment crisis going on in Berlin, with the cost of housing way out of control.  So the idea is....for the city government to grab apartment buildings (process called expropriate).

Expropriate means you have a legal means (in the Constitution) to take/grab public property owned by a company/person, giving it to the government, and in some way....reward or compensate the 'loser'.

This referendum...."Expropriate Deutsche Wohnen & Co" is about a process, where any company that owns MORE than 3,000 apartments....is going to be invited to play in this 'game.

One interesting part of the vote?  Well.....a majority of voters have to agree to the idea, and there must be a quorum (more than 617k votes). 

I should note....even if it passes....it only asks the city council to act.  It does not mandate them to act.

Cost factor?  Rarely if ever does the compensation get openly discussed.  If you had a package of forty apartment buildings worth a combined value of 500-million Euro....by law, you'd have to funnel 500-milion Euro over for the 'loss' of the buildings.  Who has this bundle of 500-million Euro?  Well...no one really.  The government could borrow the money, but if the game is about less cost on rent....where is the profit incentive to give the city enough money to pay for the package?  

The other side of this....if the government was holding 500-million Euro presently....why not just build a new public housing complex and avoid this court battle?  

Oh, I agree there is a five-star housing mess standing there, and you could have realized this already twenty years ago.  But seizing the apartment buildings will cease all future construction plans, and trigger even bigger problems down the road.

My solution?  I might get the federal guys to bundle up some cash for high-speed local railway lines....leading to no-name villages/towns 20 km outside of Berlin, and reset the interior real estate market of Berlin.   If you can make it into the heart of Berlin in 35 minutes on a train....you'd accept the quiet country situation and the cost factor would lessen.  

In the end....billions of Euro are going to be spent....one way or another.