What can be done about soaring rents?

Tens of thousands of people took to the streets in several German cities on Saturday to protest rising rents. At the same time an initiative for a referendum was launched in Berlin calling for large real estate companies to be expropriated. Commentators inside and outside Germany discuss how to tackle the challenge of providing affordable living space for all.

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Handelsblatt (DE) /

Expropriations won't solve the problem

The demand for the expropriation of real estate companies is unserious and driven by populism, Handelsblatt argues:

“Expropriations would send a fatal signal to investors and have the potential to destroy trust in the rule of law. Moreover, according to experts they wouldn't solve the problem of rising rents. Expropriations take many years and are enormously expensive. The money would be better invested in building new homes and affordable living space.”

Irish Independent (IE) /

Adjusting rents to incomes

The state needs a far bigger role and more flexibility when it comes to setting rent prices, asserts the Irish Independent:

“An affordable rental model won't just mean building more housing. It potentially means a whole raft of mechanisms to plan for and supply homes, and to decide who gets to live in those homes, and then to set rents for what may quickly be a majority of people, certainly in urban areas where young families are already mainly concentrated. That will include assessing affordability at household level - which could potentially include ratcheting rents up and down as family incomes change.”

Sega (BG) /

Back to the periphery

There's only one way to stop the explosion in living costs for good in Europe's cities, writes economist Emil Harsev in Sega:

“The only true solution for Europe is for people to move back to the periphery, accompanied by the decentralisation of job offers, investment in the transport systems and infrastructure and the promotion of work-from-home arrangements. Another real resource would be to encourage pensioners to leave the big cities. Sensible politicians are already talking about programmes for supporting the migration of pensioners. A huge industry could develop out of this, far bigger than the hotel industry. And Bulgaria also has good chances of securing a leading position in this new and extremely lucrative business sector.”

Politiken (DK) /

The renovation trap

In particular fake renovations must be stopped, Politiken explains using the example of US investment company Blackstone:

“In just two years the American giant purchased 136 apartment houses [in Denmark]. The complaints about rent hikes, fake renovations and harassment lodged with the Danish Tenants' Union speak volumes: rents for two-room flats doubled or tripled as soon as the kitchen and bathroom were refurbished, for example. ... Renovating older flats can be necessary from time to time, but for that we don't need American capital funds with only one goal in mind, namely financial growth.”