The ongoing debate about the socialisation of housing in Berlin is already having concrete effects on the capital's real estate market. A survey conducted by the BFW Landesverband Berlin/Brandenburg e.V. among its member companies proves that the persistent political uncertainties are leading to planned investments in residential construction being postponed. This currently affects 3,480 planned residential units which are not being realised due to this complex situation.
The survey results highlight the widespread uncertainty in the industry. 90 per cent of the surveyed companies state that they are already experiencing negative effects or expect them in the near future. Furthermore, 77 per cent report tightened conditions and risk premiums from banks and financing partners. This development significantly impairs the motivation of housing and real estate industry players to engage in Berlin. Planned acquisitions of existing properties also fell through, specifically 1,630 projects.
The expropriation debate has led to 37 per cent of the surveyed businesses completely suspending planned investments. This manifests in a reluctance on the part of financial markets, as credit institutions are increasingly demanding higher risk buffers or outright refusing financing. This stance by banks results in a noticeable restriction of liquidity for construction projects and modernisations. In addition to new construction projects, 143 planned modernisations were also cancelled.
- —3,480 planned homes not realised
- —1,630 planned acquisitions of existing properties cancelled
- —143 planned modernisations cancelled
- —37% of companies put investments on hold
Michael Kranz, Chairman of the Board of the BFW Landesverband Berlin/Brandenburg e.V., commented on the results by pointing out that the expropriation debate is already destroying real housing stock even before any legal decision. He emphasised that under the given conditions, characterised by risk premiums, financiers pulling out, and project stoppages, the willingness to build homes in Berlin is significantly dwindling. The creation of affordable housing can only be achieved by enabling new construction and strengthening small and medium-sized enterprises, not by pressuring them.
The profound loss of trust in financial markets and the negative assessment of Berlin as a location are underscored by further survey results. For over half (55 per cent) of those affected who have stopped investments, this specifically concerns planned construction projects. The expropriation question plays a central role in discussions with financing partners for 77 per cent of companies. In the long term, 87 per cent of respondents assess Berlin as a poor or rather poor investment location in the event of socialisation.
The BFW demands a clear position from state politics before the upcoming election day. It is considered essential to finally remove the topic of expropriation from the political agenda to restore lost trust among financiers and developers and to halt the further decline of new residential construction in Berlin.
