- CDU politician Greff advocates for increased tiered rental pricing.
Berlin's CDU politician Christian Graeff is advocating for calculating rents for municipal housing corporations based on residents' earnings. "It's nonsensical that someone with a substantial income, just because they've been living in an apartment for years, pays the same as someone with minimal income," stated Graeff, the CDU's spokesperson for construction and urban development, talking to the German Press Agency. "It's hard to comprehend."
He proposed that the municipal corporations should have the freedom to adjust rents for those who can afford it. This would be more equitable, he argued, and could also help enhance the financial situation of the housing corporations, grappling with ambitious housing targets under difficult circumstances. "Investments in existing housing often have to be postponed due to the fact that funds are diverted towards new construction, and they're not allowed to increase rents to cover it."
Municipal housing corporations are constrained by certain regulations. They can boost rents by up to 11 percent over a three-year period, but the total rent for their approximately 360,000 apartments may not increase beyond 2.9 percent annually, and the net chilly rent may not exceed 27 percent of household income.
Subsidized housing for individuals with low income is provided by the municipal corporations at entry-level chilly rents ranging from 6.50 to 9.00 euros per square meter, provided they have a housing entitlement certificate (WBS). In new construction, they are required to reserve half of the available apartments for individuals with WBS. Consequently, the other half of the apartments for free rental cost around 20 euros chilly.
Graeff identifies a "big issue" in this. "At the end of the day, someone has to cover the investment costs," he said. "And if there's a 50 percent WBS quota in public corporations and these apartments are subsidized, the other 50 percent naturally have to co-finance it. And that's a major problem that middle-class society is struggling to find affordable rental apartments."
According to Graeff, Berlin currently needs at least 200,000 additional apartments to alleviate the market somewhat. This figure does not even include anticipated immigration. Therefore, the construction target of 20,000 new apartments per year, inherited from the previous red-green-red Senate but yet to be achieved, is scarcely sufficient.
"We'll reach that within the coming years, perhaps not by 2025, but from 2026 onwards," said Graeff. Then, larger projects in new development areas would be completed. "Then there will be a significant jump upwards."
Regardless, all parties involved must still make more efforts. Graeff pointed to barriers such as high construction costs or interest rates. "But what we can do first of all, nationwide but also in Berlin, is to reduce the colossal bureaucracy." He anticipates the passage of the so-called Faster-Building Act, due for a vote in the House of Representatives by the end of the year. Graeff expects considerable federal government support for new construction.
Graeff suggested that the municipal corporations should be allowed to shift some rents for higher-income tenants, as this could help cover investment costs and improve the financial situation of the housing corporations. Due to current regulations, middle-class individuals are finding it challenging to find affordable rental apartments in Berlin, as they often have to co-finance the subsidized apartments reserved for individuals with low income.
