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Berlin approves 5-year rent freeze

reuters.com

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Re: Berlin approves 5-year rent freeze

#351

Post by SomeOldThrow »

dymk wrote: post #215
supergauntlet wrote: post #174

Earlier quoted context omitted.

Housing is not a market that should be governed by capitalism. I honestly don't care if the ultra-rich trade 30 million dollar homes and speculate on their value, but the fact that homelessness is even a problem in the first world is a travesty. Our children will look back upon a time when there were 6 (SIX!) empty homes for every homeless person in the United States and weep. Obviously those homes aren't all where t…

Homelessness is a problem of addiction and mental illness. Cheap highly regulated housing in the middle of expensive cities don't fix that. Social workers and detox programs help, but there is no easy fix (other than "finance their life") for people who can't kick a drug habit, or are mentally incapable of holding down a job.

> Homelessness is a problem of addiction and mental illness.

Have you never spent time with homeless people? You are delusional.

Re: Berlin approves 5-year rent freeze

#352

Post by EliRivers »

jimmaswell wrote: post #309
zanny wrote: post #269

Earlier quoted context omitted.

Pretty much every western nation has systemically failed to recognize or support the insanely high demand for high density living in the 21st century. That is where the future of economics is, where the future of humanity in general pretty much is, and every democracy is consistently demonstrating the total inability for legislatures to sacrifice the advantage of those lucky enough to inhabit cities as they exist now…

I don't buy any of this. Growing up everyone around me saw the city as somewhere you begrudgingly went out of necessity and only lived there if you had no choice, and I'm inclined to agree. In virtually every aspect I find more countryside-ish living much more pleasant. Consider virtual reality and remote work. I imagine much of the workforce will move to virtual offices in the near to medium-far future when corporat…

Depends on what you want, I suppose. High density humanity simply makes practical and economically viable gatherings, grouping and other activities that just don't work in low-density populations. Classes, meetups, specialist stores, hobbies, clubs, shows, lectures, institutions and just plain bubbling, embryonic interactions; all of it an order of magnitude more intense in a big city. Travel even fifty miles away from a big city and suddenly so much opportunity vanishes, or necessitates a two hour round trip into the city to take advantage of. For the people who want these things, the city is the only option. I don't work in a city because that's where my job is; I work in (the outskirts of) a city because that's where everything else I want is.

I work with people who live in the inner city and commute outwards daily for their job, because their job is just a way to pay for what they actually want, and what they actually want is to be in that city.

Re: Berlin approves 5-year rent freeze

#353

Post by [deleted] »

cheerlessbog wrote: post #197
supergauntlet wrote: post #174

Earlier quoted context omitted.

Housing is not a market that should be governed by capitalism. I honestly don't care if the ultra-rich trade 30 million dollar homes and speculate on their value, but the fact that homelessness is even a problem in the first world is a travesty. Our children will look back upon a time when there were 6 (SIX!) empty homes for every homeless person in the United States and weep. Obviously those homes aren't all where t…

As I understand it, homelessness has more complex causes than simply not having access to affordable housing.

[deleted]

Re: Berlin approves 5-year rent freeze

#354

Post by luckylion »

pgeorgi wrote: post #291
WalterBright wrote: post #255

Earlier quoted context omitted.

Rent control never works, but that never dissuades governments from trying it again and again. https://en.wikipedia.org/wiki/Rent_regulation

It works reasonably well in the rest of Germany. As for it not working in Berlin, I have a hard time to come up with _anything_ that works there, so my hunch would be that the housing market in Berlin is broken not because of rent control, but because it's Berlin.

> It works reasonably well in the rest of Germany.

How? Pretty much all large cities are much more expensive than Berlin, rent-wise (and in most other things).

Re: Berlin approves 5-year rent freeze

#355

Post by dgabriel »

jimmaswell wrote: post #309
zanny wrote: post #269

Earlier quoted context omitted.

Pretty much every western nation has systemically failed to recognize or support the insanely high demand for high density living in the 21st century. That is where the future of economics is, where the future of humanity in general pretty much is, and every democracy is consistently demonstrating the total inability for legislatures to sacrifice the advantage of those lucky enough to inhabit cities as they exist now…

I don't buy any of this. Growing up everyone around me saw the city as somewhere you begrudgingly went out of necessity and only lived there if you had no choice, and I'm inclined to agree. In virtually every aspect I find more countryside-ish living much more pleasant. Consider virtual reality and remote work. I imagine much of the workforce will move to virtual offices in the near to medium-far future when corporat…

That's sort of the opposite of my experience, where everyone couldn't wait to get out of the stultifying small town, where there was no work and no future.

Re: Berlin approves 5-year rent freeze

#356

Post by 2tab »

WalterBright wrote: post #255
2T1Qka0rEiPr wrote: post #22

As much as I can sympathise with the predicament, this decision, and the Berlin housing market in general, absolutely baffles me. When I moved here I was warned of 100 people turning up to a flat viewing, and laughed it off as some hyperbole. Only later did I find out that it actually happens , albeit the maximum viewing I went to was around a meagre 50. Having come from the UK, I found the situation in Berlin to be…

Rent control never works, but that never dissuades governments from trying it again and again. https://en.wikipedia.org/wiki/Rent_regulation

So where does "not rent control" work for long term affordable housing in in-demand areas? I don't think I know of any city comparable to Berlin, in at least size and prospects, that hasn't had significant rent increases in the last five years.

Re: Berlin approves 5-year rent freeze

#357

Post by zjaffee »

cyrksoft wrote: post #206
zjaffee wrote: post #177

Earlier quoted context omitted.

One of the biggest costs of new rental construction is financing costs (on a 30 year loan it's often half of the cost). Given that it's cheaper for the government to borrow money than the private sector you can have the government simply build market rate housing, but wouldn't need to charge as much in rent. In this context, the government can essentially be a magic entity.

So you'll force tax payers to pay for it? Government doesn't have free money. Why should people be forced to pay for the construction of such housing?

Tax payers wouldn't have to pay for anything, the only impact would be potentially on credit ratings of the government and possibly also certain interest rates in a minimal way. You can create market rate housing with government subsidized loans that don't come from tax coffers. Hell, the US federal reserve is technically the backer of hundreds of billions worth of mortgages.

Re: Berlin approves 5-year rent freeze

#358

Post by dvorak365 »

objektif wrote: post #60

I think the only solution to high rents and home prices is to build more and more supply. But strangely there is opposition to this from both sides of the political spectrum. Left opposes it in the name of “preserving neighborhoods”, conservative wealthy home owners dont want new inventory to reduce their real estate valuations, and developers oppose it because it will eat into their profits.

The left has no issue with building more supply. The issue they tend to have is when housing is commodified - the new units being built are for maximizing private profit, not number of people housed. (The former tends to lead to the breakup of established communities as they get priced out of their longtime homes). Lefties I know are incredibly excited about the prospect of massive construction projects to build more public and social housing.

Re: Berlin approves 5-year rent freeze

#359

Post by luckylion »

wongarsu wrote: post #271
jordanbeiber wrote: post #221

Earlier quoted context omitted.

It’s an interesting catch 22. The housing you make margins off are expensive housing in expensive locations. The reason to keep rents affordable is that it’s generally a good thing in terms of keeping gentrificarion and segregation in check. Cap on rent can’t be the only policy though. I see the exact same situation in Stockholm, and there’s a concensus that profit margins are not good enough. How to solve it? Either…

If the city wants something the market can't provide the solution is to do it yourself. Berlin is partially doing that. The "Wohnungsbaugesellschaft Berlin-Mitte" is a housing association owned by the City of Berlin that builds and rents out apartments. They more or less act like other investors, just with more focus on social factors than on high profits.

> just with more focus on social factors than on high profits

Which is basically a political issue, because they will say "some people are more equal than others". Personally, I prefer naked capitalism over this "you need to know somebody in the party to get a good flat"-stuff.

Re: Berlin approves 5-year rent freeze

#360

Post by tomatocracy »

pgeorgi wrote: post #291
WalterBright wrote: post #255

Earlier quoted context omitted.

Rent control never works, but that never dissuades governments from trying it again and again. https://en.wikipedia.org/wiki/Rent_regulation

It works reasonably well in the rest of Germany. As for it not working in Berlin, I have a hard time to come up with _anything_ that works there, so my hunch would be that the housing market in Berlin is broken not because of rent control, but because it's Berlin.

It "works" (in that it doesn't cause problems like rationing by other means like queueing, under the table payments, subletting, or any one of the myriad other problems rent control produces) because it actually does nothing - it results in rents which are equal to what the open market price would have been.

Ultimately, if you want to reduce rents AND have a functioning market, you have two options (or a combination of them): (1) reduce demand, (2) increase supply.

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