Housing Market in Motion: Berlin Acquires Vonovia Properties

In a decisive step to calm the tense housing market, the state of Berlin has acquired a significant number of apartments from Vonovia, the largest German real estate company. In the capital, around 4,500 apartments in the Lichtenberg district are now being transferred to the ownership of the state-owned housing company Howoge. The transaction, which was announced in a press release by the Governing Mayor Kai Wegner from the Red City Hall, underscores the Senate's strategic objective to substantially reinforce the municipal housing stock. Furthermore, through this deal, Berlin has secured lucrative building plots. The joint project of Howoge and Berlinovo, both owned by the state, includes the acquisition of approximately 6.9 hectares of potential building sites in the districts of Buch and Lichtenberg. The financial magnitude of the real estate transaction is estimated at about 700 million euros. The financing of the acquisition will be achieved through the internal funds of the involved state-owned companies and by raising external capital. The intention behind Berlin's latest real estate moves is clear: By expanding the municipal housing stock — which currently makes up about one fifth of the 1.7 million rental apartments in Berlin — the Senate is attempting to extend its influence. Through purchases, along with new construction, more control over the housing market is to be obtained and, in particular, the rise in rents to be effectively contained. The reasoning is obvious: More municipal apartments mean greater regulatory ability in a market segment that is of existential importance to many citizens.