Private versus state-owned housing in Berlin: Changing provision of low-income households

Abstract

Housing privatization in Germany was heavily pursued after the unification until the mid-2000s. Berlin, which once was the stronghold of state-owned housing in the early 1990s, became the center of housing privatization due to decisions of national and local policymakers. Compared to other European countries, the German (and Berlin) approach was characterized by en-bloc sales of huge portfolios and entire companies to yield-oriented Anglo-American investors. Until the mid-2000s, the critical discussion of the housing privatization highlighted a massive displacement of tenants with a low social status (hereafter referred to as low-income households) from the privatized stocks causing social segregation processes, associated with ownership. However, letting strategies of the new investors were aimed at the allocation of low-income households instead of displacing them. This development as well as a transformation of the remaining state-owned housing companies led to a change of the allocation of especially low-income tenants. In the light of these developments, the presented study examines the correlation of social and ownership structure in Berlin's neighborhoods and, thus, contributes to the ongoing debate of private and state-owned housing owners' influence on the tenant allocation in Berlin's neighborhoods. Unlike previous research, focusing on qualitative case studies, this study applies a statistical approach to reveal the increased relevance of low-income households in financial investors' housing stocks.