Decommodification of Housing in Berlin and how we can learn from it in the Twin Cities
(Originally Published in Streets.MN)
BERLIN, GERMANY — Berlin residents have shown a path out of our global housing crisis via the Deutsche Wohnen & Co. Enteignen (DWE) movement — a mass civil society campaign to socialize tens of thousands of units of private housing stock owned by the most speculative and egregious landlords. However, the German government, much like our Minnesotan and national institutions, has failed to implement the voters’ mandate. The Twin Cities and Berlin are both innovation hubs that nurture new ideas and socio-technical systems that could help us get out of the 21st century crises of economic imbalance and ecological crisis.
The lessons from DWE in Berlin could show Minnesota urbanists how to adapt and develop the solutions that will allow our descendants to thrive.
I picked Berlin for my urbanism masters because I knew it was an innovation hub for housing solutions, beyond the traditional private market. Innovation theory shows us that new innovations, especially for complex socio-technical systems like housing and transportation, happen in niches where they’re supported. This is usually cities. Berlin and Minneapolis/St. Paul are both hubs for social innovation, with potential to develop solutions to our global crises. In this article, I’ll elaborate on key socio-technical housing innovations in Berlin and how we could leverage these innovations in Minnesota for a thriving future.
When I arrived in Berlin for the Urban Management Masters at TU Berlin, one of my first stops was the Right 2 the City (R2C) intro session. Right 2 the City is an international, English-speaking working group of the massive DWE. That Berlin housing justice movement is named for exactly what they intend to do: enteignen (expropriate and de-commodify) over a half million units of housing.
- In this context, to expropriate means to force private hedge funds and rental companies that own over 3,000 units of housing to sell to the public at below-market rate.
- Decommodification means to permanently remove the housing stock from the private, volatile market and for the housing to be maintained in perpetuity as a public good.
Deutsche Wohnen & Co., the initial target, was the largest and among the most exploitative speculative landlords on the Berlin housing market, though the company has since changed its name twice. Resale and name changes are a convenient way to hide who’s really to blame, and who is benefiting the most, from the housing crisis.
Any follower of the global housing crisis knows that homelessness is a policy choice. As my urban economics professor, Ares Kalandides, said in our second class, “We don’t have a shortage of housing. We have a shortage of available housing because it’s not profitable to provide dignified housing to the non-elite.”
Berlin, like international cities around the world, has thousands of buildings and square feet of living space that are locked up in financial speculation. American billionaires and the Italian Mafia alike find housing and land to be among the most profitable and useful enterprises for money laundering and storing wealth.
The Folly of ‘Affordable Housing’
I highly recommend the 2021 film PUSH by Fredrik Gerten for an in-depth look at the global housing crisis and its economic trappings. In short, we don’t actually have a shortage of housing itself. We have a broken system for distributing goods and resources that makes it profitable to create shortfalls and to cater to only one small segment of the housing market.
This is quite different from the attitudes and ideas expounded on by media and YIMBY politicians, but it’s clear to most tenants I’ve worked with in my organizing back home that subsidizing privately owned, temporarily “affordable” housing doesn’t work. We’ve been spending millions on subsidized privately owned rentals tied to area median income. This housing is affordable only according to HUD definitions, and still ends up extracting wealth from its residents while making property speculators very rich. After 15 to 20 years, it loses its income restriction and can be resold.
“Affordable housing” that is not democratic or permanent hasn’t been working. An alternative could be truly caring for our community in the form of permanent community assets. When we spend millions on housing, it should be deeply affordable, stable and democratic housing for our cities, not for the profit of a few.
To decommodify housing is to make housing something other than a commodity, traded at market rates. Decommodification means making housing a social good and human right. Housing can be something provided by and for us all collectively, rather than something we always are afraid to lose. Inadequate housing is a major cause of bad health and shorter lifespans. Evictions and rent increases are linked to premature death. Furthermore, more people died in Los Angeles of homelessness in 2021 and 2022 than in 9/11. Also see this Human Rights Watch Report on LA homelessness.
Housing should bring us together, and make us feel pride and peace. Dense housing can make life better with walkability and transit, but true solutions to urban housing problems are ones that give people long-term stability and allow individuals and their communities to flourish. What if the answer to crime, urban litter, drugs on the light rail and even community involvement in maintenance of green space, was ensuring everyone a dignified, stable and beautiful home?
Socio-Technical Innovation of Non-Market Housing in Berlin
The goal of DWE and R2C’s campaign is a permanent solution to the housing crisis in Berlin by socializing (turning over to collective or public ownership) a few hundred thousand units of housing — those owned by the most exploitative and speculative landlord bodies. This is the only real response to the mass financialization of housing.
Here in Berlin, social ownership looks two ways.
- First, 360,000 units of housing are in their local public ownership model where six democratically operated public corporations, funded by city and state funds, are kept permanently affordable and make desirable long-term living situations for Berliners of all stripes.
- Second, a sizeable proportion (roughly 12%) of Berlin’s housing is self-managed by 80 cooperative housing organizations that allow residents to permanently manage their own housing through collective ownership. Per Dr. Michael Lafond, an American expert in cooperative housing who lives in Berlin, cooperatives here must be permanently affordable, and they don’t allow for speculative resale of shares, as full-equity or partial-equity housing cooperatives do in the United States.
- One particularly interesting model found in Berlin and now spreading across Germany and outside the country is the Mietshäuser Syndikat, a model for permanent decommodification and democratic control, which supports tenant groups to buy their buildings and permanently remove them from the market.
A few people talk about decommodification of housing in the Twin Cities, perhaps because the right of mass private-property accumulation, and protecting mass private property (especially land) from the diverse working class, is foundational to the American legal system. And, of course, to compete with the incredible inertia of our current ownership system and the money and PR of the landlord lobby, it takes sophistication, research, money and time — which the most radical of us are rarely permitted. We’re lucky to have the Center for Urban and Regional Affairs at the University of Minnesota showing us that rent control could work; Berlin’s housing activists have their own support from local academia.
Dr. Andrej Holm, lecturer at Humboldt University, showed in his recent study that social (decommodified) housing cuts the rent. In fact, in his survey of over a million units of decommodified housing projects in Berlin and Vienna, co-operatives and publicly funded permanently affordable housing were shown to create deeply affordable, high-quality housing and maintain it in perpetuity. In Berlin, mass socialization could cut rents 16%, and then allow them to be permanently frozen (Holm, 2021). In an article for HAU, conveniently translated to English by Mieke Woelke, Holm writes clearly on how displacement is really its own business model, and how social movements for a true right to housing are key to fighting it.
With strong research backing a movement to make housing a human right and take it off the market, what is stopping us?
The key answer is our legal systems (both in the U.S. and Germany) protect the supposed right to property ownership far more than any right to dignified or basic living needs. Deeper than this, human inertia is always a barrier to innovation — especially innovation to complex socio-technical systems, such as housing or transportation.
Ignoring the Will of the Voters
Both in St. Paul and in Minneapolis, the people have voted to take steps to put human rights over profit. However, much like in St. Paul, Germany’s political class moved to block the democratic victory. Though Berlin voters and activists successfully passed a referendum in 2021 that directed the city to expropriate (enteignen) some 300,000 units, reimbursing the property owners at below-market rate and removing them permanently from the private market, the city government refused to take action. The referendum won by 59%, even though 25% of Berliners can’t vote due to their migration and immigrant status.
Much like in St. Paul and Minneapolis, the city government commissioned an expert study, which published a 150-page report and found that the plan was legal, feasible, practical and might actually fix a huge portion of the Berlin housing crisis! The report can be found here but is not available in English. By establishing the precedence of enteignen, by reducing rents across the board, and by creating a new stock of social and public housing accessible by low-income and middle-income residents from housing currently controlled by speculators, DWE and their referendums show a path to a truly different cityscape — a real right to the city.
The 2021 referendum was non-binding, which allowed the Berlin city government to ignore it. Now DWE is working on a binding referendum, so the city government cannot wriggle out of its democratic mandate.
Urbanists and policy wonks, as well as community organizers, should take note. If we must work on policy campaigns, this is the kind of policy campaign we should consider: one that permanently strikes at the root, decommodifying thousands of units of housing and making the worst hedge funds involved in speculation (which has only expanded since 2008) share some of the wealth they’ve extracted from our neighbors, not further protecting their infinite potential profit.
I think it’s also especially important to consider how we’re envisioning care in our society. Right 2 the City impressed me by showing that they intentionally consider organizing to be a form of care work and, in the broader Marxist sense, to be reproductive labor — labor that is necessary to allow for any kind of “productive” labor — just like childcare, healthcare and education. We Minnesotans value healthcare and education, but not in a way that makes education or nursing either lucrative or truly respected careers.
The elimination of the commons in the early stages of the industrial revolution made the private all the more political. Now, our ability to adapt to the crises of the 21st century, and the crises of liberal democracy, will be directly linked to how well we integrate the learning by intersectional feminist scholars who have shown how critical care is to the city, to society and to one another.
As lecturer Dr. Elke Krasny reframed for me, “Care is life’s work,” paraphrasing Mitchell, Marston and Katz in their 2003 book “Life’s Work. Geographies of Social Reproduction.” Fitz and Krasny’s Critical Care from 2019 is top of my list to tackle this subject.
Can Something Better Replace Our Socio-Technical Systems?
As Mayor Melvin Carter seeks to remove the rest of our rent stabilization protections in St. Paul, where we won the strongest rent control policy in the country two years ago, and Minneapolis Mayor Jacob Frey fights tooth and nail against a kinder, healthier Minneapolis — by calling police and bulldozers on unhoused people instead of simply housing people — we must turn to decommodification in earnest. The Reagan- and Thatcher-era push to eliminate the social safety net and market-ify everything has shown its long-term effect. Neoliberal politics have let our cities get less and less livable. We deserve and need something better. However, like any major innovation, transforming our system will experience major pushback — just like the pushback against transitions to electric trams and cars from horse-drawn carriages in the early 20th century. We won’t be able to decommodify housing tomorrow. But we can start talking about it and thinking about it and supporting movements that lead toward it.
We must reclaim the right for everyone to live in the city and embrace our future vibrancy, not cling to the past and a system of land ownership that doesn’t work for any of us in the long run. To survive the global climate catastrophe, we need to find a way for everyone to feel prosperous and safe that is fully decoupled from market growth. The right to a home, and the decommodification of housing, is a central first step toward that. Diverse cities are absolutely the right place to demonstrate this and lead the way to a better future for all humans. A right to a healthy, beautiful home is the basic human right that will transform our society and our cities. Let’s follow Deutsche Wohnen & Co. Enteignen and organize, care for one another and expropriate our worst landlords. The Twin Cities housing crisis can be solved by socializing hundreds of thousands of units of housing, and then renovating old buildings and building more in a way where communities and individuals permanently benefit from public expenditure. The city can be a place of infinite possibility, should we choose a brighter future.
By David A.
Author’s note: More in-depth reading in English on DWE and urbanism movements in Berlin can be found here and here.