Rich people don’t need protection
Major landlords are calling for new tenancy law
December 2, 2023, 3:12 a.m
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The German housing giants complain about the shackles of tenancy law. Not all tenants need protection, explain the bosses of Vonovia and Saga. Higher earners should not be allowed to block cheap, state-subsidized housing in times of scarcity.
According to two of the most important landlords in Germany, German tenancy law needs to be reformed. The current legal regulations have negative consequences for the rental market and new buildings, complained the head of the Dax group Vonovia, Rolf Buch, and the CEO of the largest municipal landlord Saga from Hamburg, Thomas Krebs, in the “Süddeutsche Zeitung”.
The question arises as to “who needs protection and cheap rents and who pays too little compared to their ability to pay,” said Buch. “The rental market needs to be regulated, nobody wants London conditions.” But things cannot continue as they are now – especially in view of the crisis in housing construction. Only part of the market needs to be protected: “In the case of cheap apartments, it is necessary that they remain cheap,” said Buch. “Apartments like this that craftsmen, tram drivers or firefighters can afford. Expensive apartments don’t need protection.”
Voluntary tenant information about income
Saga boss Krebs advocated changing the rules for publicly subsidized housing: “After five years, we should ask tenants to provide voluntary information about their income and the number of residents.” In this way, subsidized and therefore cheap apartments can be prevented from being permanently occupied, even if the conditions no longer exist. If that is the case, “the rent should be adjusted.”
The large number of government interventions are now having negative consequences on the market, said Buch. In Berlin, for example, the rent cap “led to a legal and an illegal black market”: the number of sublet or furnished apartments has risen rapidly, and landlords often no longer have access to their own cheap apartments, especially in good locations. “Unfortunately you have to take note of that, and that annoys me,” said Krebs.
Vonovia is the largest private landlord in Europe with almost 550,000 apartments in Germany, Sweden and Austria. In this country alone, the DAX group has almost 490,000 apartments. The saga recently had almost 140,000 apartments in Hamburg.