6 ms·

Keep in mind that when they say Berlin's rents are soaring, it's still comparatively cheap for large cities in Germany.

by luckylion 6y ago

ceilingcorner 6y ago
Irrelevant unless compared to local salaries, which as far as I know, are still lower than the rest of German cities.
- cbmuser 6y ago
  Berlin has less than 1% of empty rental apartments which is extremely low. This means that the rents do actually reflect the real market. And there is simply no right for a cheap apartment in the center of Berlin.
  - mytailorisrich 6y ago
    Rents pretty much always reflect the "real market". There can be speculation on property but there is no speculative gain to be made on renting and the demand for rental properties reflects the actual demand for housing. Obviously when more people want to rent than there are properties available rents go up. This is why rent caps do not solve problems. They ignore and do not address the cause of high rents and they may make things worse by reducing supply and making tenants stay put. And as you say not everyone can live in the most desirable areas, which will always be pricey.
  - avh02 6y ago
    technically, yes. but the reality is that the population is changing. I've only been here a few years but basically everybody who's been here longer says "it's not what it used to be" in that the vibe of the city has changed greatly with it's increasing attractiveness to foreign (tech?) workers. The "original" inhabitants of the city are priced out in "favour" of expats. The "real market" itself is obviously both combined, but one segment can afford the higher prices, and there's an ever increasing number in that segment that is shifting it for everyone. Obviously I see that I'm ironically part of the problem.
    - luckylion 6y ago
      > everybody who's been here longer says "it's not what it used to be" in that the vibe of the city has changed greatly with it's increasing attractiveness to foreign (tech?) workers. Meh. The people who say that have displaced the people who lived there before they moved to Berlin. And the people who lived there before they came also said that when they arrived. The people complaining about this the most aren't "original" inhabitants, they moved to Berlin 10-20 years ago because it was cheap, hip, and had less rules around things. They've changed Berlin. Now it's changing again. The circle of change, if you will. They've done it to others, now it's being done to them. Sucks every time, but claiming some sort of "the indigenous population gets removed" is false.
      - ceilingcorner 6y ago
        Cities change, often for the worse. Replacing the people that made a city’s culture notable because they can’t afford it is not good for anyone. Lower Manhattan is a shining example of this. That area is built on the memory of artists who can no longer afford to live there. It’s a weird sort of fossilization and museumification.
        luckylion 6y ago
        > Replacing the people that made a city’s culture notable because they can’t afford it is not good for anyone. Berlin's attraction in the last 70 years (from the Western perspective) has been that it's cheap, has kind of an frontier spirit, laws and rules are much less strict, and it's being well-funded as an enclave and a thorn in East-Germany's side (it's still losing money, and is a drag on the German economy; capitals in comparable Western countries are typically strong economic motors in their country [1]). For many young men, Germany's draft (or the alternative civil service) could only be circumvented by moving to Berlin. With the Reunification, Berlin was on track to become the capital once more. That meant: gigantic amounts of money, jobs and opportunities, and that in return made Berlin extremely attractive. Before that happened, Berlin was actually shrinking. With the government moved many large corporations in Germany, and brought even more money and jobs. They made Berlin attractive. It wasn't Berlin's night life and cultural scene, those are a consequence of the attractiveness and funding, not the other way round. So it's really not that those who built it are being forced out. It's that those who were attracted to it have to share with other people who want to also live there. Sucks for them, I agree, but there's nothing unfair about it. It will also happen to those moving there today, and they'll complain as well. [1] https://qz.com/753244/berlin-is-the-only-capital-city-in-europe-that-is-a-drag-on-its-countrys-economy/ https://qz.com/753244/berlin-is-the-only-capital-city-in-eur...
- deleted 6y ago
  [deleted]
- DangerousPie 6y ago
  If salaries were so bad, people would stop moving to Berlin and rents would fall. The fact that housing is still under such high demand shows that Berlin is clearly still a desirable place to live.
  - ceilingcorner 6y ago
    I don’t think salary is the only or even primary reason people move to Berlin.
    - DangerousPie 6y ago
      Sure, but in the end the market rents will still reflect the desirability of living in Berlin. Whether that's because of salaries, culture, transport or something else.
- luckylion 6y ago
  Rents are ~30% lower (my estimate based on my experience), salaries are ~10-20% lower (varies over industries, not really relevant for large companies). Sounds like you're still getting a good deal if you live in Berlin. Many other things are cheaper as well. Power is -10% in Berlin for example, compared to Hamburg. Local taxes are also lower, e.g. business tax rate in Berlin is 410% while it's 470% in Hamburg. I get the impression that it's mostly the citizens of Berlin not knowing what things cost elsewhere.
llampx 6y ago
Yes but the only thing keeping the prices halfway reasonable are the laws and regulations that apply in Berlin. Without those the situation would be much worse.
- dsnr 6y ago
  Curious, what are those laws and regulations that apply in Berlin and are different from any other german city?
gryzzly 6y ago
That is simply not the case anymore. Neither are the sale prices low anymore. You will now pay same m2 price as in West-est west, like at the border with Switzerland.
- luckylion 6y ago
  Please compare Berlin prices with Hamburg, Dusseldorf or Munich. It's really not close, Berlin is largely still 10-15€/sqm, peaking to 20. Similar offers in e.g. Hamburg are 20, peaking to 30€/sqm. And it's been this way for a decade or two. Having lived in Hamburg, whenever I was with Berlin friends and heard their complaints, they usually turned into being happy for the good fortune not to have to pay those prices when they compared it not with Berlin 10 years ago, but with Hamburg today.
CryptoPunk 6y ago
It's not truly affordable, because even if you have enough to pay the rent, you have a difficult time finding an apartment, resulting in many people with enough income to afford the nominal rental rates ending up not being able to get a rental. Price controls lead to shortages at the price point that the government dictates is the ceiling. It's a silly work around based on the fallacy that the problem with high prices is people charging too much, as opposed to the supply of the good in question being insufficient relative to the demand for it. The high price is actually the most effective solution to the problem of scarcity, and price controls prevent that solution from working.

Keep in mind that when they say Berlin's rents are soaring, it's still comparatively cheap for large cities in Germany.

ceilingcorner 6y ago

Irrelevant unless compared to local salaries, which as far as I know, are still lower than the rest of German cities.

cbmuser 6y ago
Berlin has less than 1% of empty rental apartments which is extremely low. This means that the rents do actually reflect the real market. And there is simply no right for a cheap apartment in the center of Berlin.
- mytailorisrich 6y ago
  Rents pretty much always reflect the "real market". There can be speculation on property but there is no speculative gain to be made on renting and the demand for rental properties reflects the actual demand for housing. Obviously when more people want to rent than there are properties available rents go up. This is why rent caps do not solve problems. They ignore and do not address the cause of high rents and they may make things worse by reducing supply and making tenants stay put. And as you say not everyone can live in the most desirable areas, which will always be pricey.
- avh02 6y ago
  technically, yes. but the reality is that the population is changing. I've only been here a few years but basically everybody who's been here longer says "it's not what it used to be" in that the vibe of the city has changed greatly with it's increasing attractiveness to foreign (tech?) workers. The "original" inhabitants of the city are priced out in "favour" of expats. The "real market" itself is obviously both combined, but one segment can afford the higher prices, and there's an ever increasing number in that segment that is shifting it for everyone. Obviously I see that I'm ironically part of the problem.
  - luckylion 6y ago
    > everybody who's been here longer says "it's not what it used to be" in that the vibe of the city has changed greatly with it's increasing attractiveness to foreign (tech?) workers. Meh. The people who say that have displaced the people who lived there before they moved to Berlin. And the people who lived there before they came also said that when they arrived. The people complaining about this the most aren't "original" inhabitants, they moved to Berlin 10-20 years ago because it was cheap, hip, and had less rules around things. They've changed Berlin. Now it's changing again. The circle of change, if you will. They've done it to others, now it's being done to them. Sucks every time, but claiming some sort of "the indigenous population gets removed" is false.
    - ceilingcorner 6y ago
      Cities change, often for the worse. Replacing the people that made a city’s culture notable because they can’t afford it is not good for anyone. Lower Manhattan is a shining example of this. That area is built on the memory of artists who can no longer afford to live there. It’s a weird sort of fossilization and museumification.
      - luckylion 6y ago
        > Replacing the people that made a city’s culture notable because they can’t afford it is not good for anyone. Berlin's attraction in the last 70 years (from the Western perspective) has been that it's cheap, has kind of an frontier spirit, laws and rules are much less strict, and it's being well-funded as an enclave and a thorn in East-Germany's side (it's still losing money, and is a drag on the German economy; capitals in comparable Western countries are typically strong economic motors in their country [1]). For many young men, Germany's draft (or the alternative civil service) could only be circumvented by moving to Berlin. With the Reunification, Berlin was on track to become the capital once more. That meant: gigantic amounts of money, jobs and opportunities, and that in return made Berlin extremely attractive. Before that happened, Berlin was actually shrinking. With the government moved many large corporations in Germany, and brought even more money and jobs. They made Berlin attractive. It wasn't Berlin's night life and cultural scene, those are a consequence of the attractiveness and funding, not the other way round. So it's really not that those who built it are being forced out. It's that those who were attracted to it have to share with other people who want to also live there. Sucks for them, I agree, but there's nothing unfair about it. It will also happen to those moving there today, and they'll complain as well. [1] https://qz.com/753244/berlin-is-the-only-capital-city-in-europe-that-is-a-drag-on-its-countrys-economy/ https://qz.com/753244/berlin-is-the-only-capital-city-in-eur...
deleted 6y ago
[deleted]
DangerousPie 6y ago
If salaries were so bad, people would stop moving to Berlin and rents would fall. The fact that housing is still under such high demand shows that Berlin is clearly still a desirable place to live.
- ceilingcorner 6y ago
  I don’t think salary is the only or even primary reason people move to Berlin.
  - DangerousPie 6y ago
    Sure, but in the end the market rents will still reflect the desirability of living in Berlin. Whether that's because of salaries, culture, transport or something else.
luckylion 6y ago
Rents are ~30% lower (my estimate based on my experience), salaries are ~10-20% lower (varies over industries, not really relevant for large companies). Sounds like you're still getting a good deal if you live in Berlin. Many other things are cheaper as well. Power is -10% in Berlin for example, compared to Hamburg. Local taxes are also lower, e.g. business tax rate in Berlin is 410% while it's 470% in Hamburg. I get the impression that it's mostly the citizens of Berlin not knowing what things cost elsewhere.

llampx 6y ago

Yes but the only thing keeping the prices halfway reasonable are the laws and regulations that apply in Berlin. Without those the situation would be much worse.

dsnr 6y ago
Curious, what are those laws and regulations that apply in Berlin and are different from any other german city?

gryzzly 6y ago

That is simply not the case anymore. Neither are the sale prices low anymore. You will now pay same m2 price as in West-est west, like at the border with Switzerland.

luckylion 6y ago
Please compare Berlin prices with Hamburg, Dusseldorf or Munich. It's really not close, Berlin is largely still 10-15€/sqm, peaking to 20. Similar offers in e.g. Hamburg are 20, peaking to 30€/sqm. And it's been this way for a decade or two. Having lived in Hamburg, whenever I was with Berlin friends and heard their complaints, they usually turned into being happy for the good fortune not to have to pay those prices when they compared it not with Berlin 10 years ago, but with Hamburg today.

CryptoPunk 6y ago

It's not truly affordable, because even if you have enough to pay the rent, you have a difficult time finding an apartment, resulting in many people with enough income to afford the nominal rental rates ending up not being able to get a rental. Price controls lead to shortages at the price point that the government dictates is the ceiling. It's a silly work around based on the fallacy that the problem with high prices is people charging too much, as opposed to the supply of the good in question being insufficient relative to the demand for it. The high price is actually the most effective solution to the problem of scarcity, and price controls prevent that solution from working.