Berlin's Left, Greens, and SPD Propose Socialization of Large Private Housing Stocks

Berlin's coalition parties—the Left Party (Linke), Greens, and Social Democrats (SPD)—are proposing a landmark plan to socialize private housing stocks exceeding 10,000 apartments, aiming to curb housing speculation and expand affordable living options. Under the initiative, private companies owning over 10,000 apartments in Berlin would be compelled to relinquish any excess beyond that number, with the socialization applying only to apartments built before 2021.

The coalition has earmarked a compensation budget of up to 16 billion euros for this process, ensuring financial feasibility. Socialization is legally grounded in Article 15 of the German Constitution, which permits property socialization for public benefit, and notably exempts cooperatives and socially oriented organizations. The policy envisions that average rents in the transferred apartments will not exceed prior rental levels at the time of handover. A law enacting this measure is expected to be passed by mid-2028 and come into force a year later.

This approach marks a departure from the 2021 Berlin referendum that targeted companies with over 3,000 apartments, now shifting the threshold to 10,000. The SPD's prior opposition to expropriations shifted amidst coalition talks, reflecting a collaborative stance. As part of the housing strategy, the coalition plans to institute rent caps for state-owned housing and establish a new authority to oversee rent increases.

Beyond socialization, the coalition aims to launch Berlin's largest affordable housing construction program since reunification, targeting the approval of 100,000 new apartments by 2031, with public housing entities responsible for at least half of these units.

However, the proposal faces resistance at the federal level; Federal Minister Verena Hubertz has voiced opposition, arguing that socialization fails to create new housing and would incur high compensation costs. The housing corporation Vonovia, owning over 138,000 Berlin apartments with a market value of 23.5 billion euros, stands as a major player affected by the plan.

This initiative reflects Berlin's urgent response to a deepening housing crisis, as the parties work toward a transformative housing policy aimed at stabilizing rents, limiting speculation, and expanding affordable housing stock.