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There are some key differences in rental legislation that drive how different cultures view home ownership. From my experience in the UK, homeownership has a l

There are some key differences in rental legislation that drive how different cultures view home ownership. From my experience in the UK, homeownership has a lot of cultural weight, because it's really the only way to guarantee stability in housing. While renting, you typically have to renew every year, which results in unexpected price changes and the constant risk you might have to move unexpectedly (often with just 1 month notice periods). In many European countries though, including Germany, this isn't such a thing. Leases are often indefinite, landlords will really struggle to evict you against your will as long as you are paying your rent and not destroying the place (the only notable exception being if they evict you to personally live in the flat as their main residence) and there are tight limits to the rent increases allowed (https://conny.de/en/rent/rent-increase/information https://conny.de/en/rent/rent-increase/information). When you can get ~similar housing stability without ownership, it becomes more a question of flexibility vs financial investment, rather than a strict goal that always makes sense. There's also lots of subsidies in Germany that actively support the rental market (rather than houseownership, unlike elsewhere): https://www.brookings.edu/articles/Germany-rental-housing-markets/ https://www.brookings.edu/articles/Germany-rental-housing-ma...

dukeyukey 3y ago
> often with just 1 month notice periods This is mostly not the case - a 2-month notice period is way more common. It might not even be legal with a typical shorthold tenancy.
FirmwareBurner 3y ago
>Leases are often indefinite How common is that today? In Austria most landlords stopped offering indefinite leases a long time ago, and are instead renewed every 3 years or so when they can increase your rent or kick you out. Or if you have an indefinite lease it's automatically indexed by inflation which screws you big time if your wages aren't keeping up. The only indefinite lease currently in existence without inflation indexing are very old contracts who got grandfathered in but no landlord is crazy to offer that today anymore.
- whstl 3y ago
  I don't think this is common in Berlin anymore. My last 3 leases had a limit of 3 years. My friends are all in similar situations. It is not difficult to renew, though, but there will be a price adjustment. I eventually caved and bought an apartment.
- ManBeardPc 3y ago
  In my experience indefinite is pretty much the default here in Germany. I only heard about limited leases for students that only move to a certain location because of university.
  - sumuyuda 3y ago
    A fixed term lease in Germany is only legal in some narrow circumstances and can’t be renewed multiple times in a row. I think after a few years the landlord has to offer you an unlimited lease.
    - seanmcdirmid 3y ago
      Are German leases indexed to inflation at least?
      - ManBeardPc 3y ago
        Haven't met anyone which such a contract. It's usually a fixed value. The owner may choose to raise it every now and then, but laws limit it to a certain amount per year and there needs to be a reason, for example modernization or other buildings in the area are becoming more expensive. You can of course make a contract that allows for automatic raises, but that is also limited (earliest 12 month after the begin of the lease, only a fixed/absolute value and not percentage) and you can no longer raise the price for the other reasons. There are probably other models, but I don't know much about them.
- ce4 3y ago
  Indexed and contracts with stepped rent are also a thing here, especially for sought-after zones/cities. I e.g. avoid those if possible and we've moved out of an (inflation) indexed lease contract recently. Now back to just a regular (non-stepped/indexes) indefinite contract as usual. As to why we dont buy: We like the flexibility and also property prices here make it hard to get sth. decent in comparison to renting.
flohofwoe 3y ago
> if they evict you to personally live in the flat as their main residence ...even this is pretty much impossible after 20 years AFAIK.
cassianoleal 3y ago
> Leases are often indefinite I've seen leases in the UK for 999 years. Not rentals though - leaseholds. This is a very odd feature of UK housing. You pretty much go through all the steps of buying a property but in the end all you bought was the right to live in the place until the lease runs out. It also leads to some oddities, like this [0] very cheap flat a stone's throw away from Regent's Park. It's this price because there are less than 10 years left in the lease and I imagine the current tenants/"owners" couldn't renew it. This could happen for many reasons, e.g. the "actual owner" or freeholder wants to raise the lease value too much, or the freeholder couldn't be found. In the latter case I'm not sure what happens, but I imagine it's possible that no one will ever claim the property - and I have no idea in what legal standing this leaves the property. This is the most common form of "ownership" of flats and apartments. Houses are generally "freeholds", which means you actually own the property. [0] https://www.rightmove.co.uk/properties/142789514 https://www.rightmove.co.uk/properties/142789514
- robocat 3y ago
  > or the freeholder couldn't be found When does squatting rights become in play? What happens if a leaseholder doesn't move out? Do freeholders have extra rights to kick people off property beyond what landlords do?
- pimterry 3y ago
  This is currently part of a big political debate, and _might_ change, although the current government have dodged it so far: - https://www.bbc.com/news/uk-politics-67569517 https://www.bbc.com/news/uk-politics-67569517 - https://commonslibrary.parliament.uk/leasehold-reform-in-england-and-wales/ https://commonslibrary.parliament.uk/leasehold-reform-in-eng... - https://www.theguardian.com/society/2023/nov/04/labour-promises-rapid-housing-action-after-years-of-tory-paper-promises https://www.theguardian.com/society/2023/nov/04/labour-promi... Much of the rest of Europe & elsewhere heavily uses a commonhold model (https://www.lease-advice.org/advice-guide/commonhold/ https://www.lease-advice.org/advice-guide/commonhold/) where all owners of flats in a block collectively own the shared structure of the block itself, and share responsibility for maintaining that as required, with a communal budget and democratic voting on decisions.
throwawayyy9237 3y ago
Isn't this changing soon (or at least when the Renter's Reform Bill passes[1])? Contracts will not have fixed terms anymore and "no-fault" evictions will be illegal. Those are two main ones I think. [1] - https://bills.parliament.uk/bills/3462 https://bills.parliament.uk/bills/3462
ahaferburg 3y ago
There's also the high transaction cost. https://www.iwkoeln.de/fileadmin/publikationen/2016/310521/IW-Kurzbericht_72_2016_Transaction_Costs.pdf https://www.iwkoeln.de/fileadmin/publikationen/2016/310521/I... > The cost of a real estate agent would increase the transaction costs considerably; but since the use of housing brokers is not mandatory, they are left out of the calculation. Could somebody with more insight than me comment on the total transaction costs? To me it seems like this is one of the main reasons for people to refrain from buying, because it locks them in. Also, in Berlin at least, prices for buying are skyrocketing. Rents are increasing as well, but probably can't increase as much because of protections.
tharmas 3y ago
So what happened to Berlin? It went to a nice cheap affordable city to an Anglo style neoliberal nightmare. I realize it got popular and people moved there but if there are such renter friendly laws in place how did Berlin end up like it did?
- seanmcdirmid 3y ago
  I don't think any rent control/relaxed zoning regulations can survive popularity with new residents that have substantial buying power. Berlin was cheap for so long because it wasn't popular, but it had everything to be popular, and so eventually would be. Tokyo would be the same if salaries/wages in Tokyo weren't so depressed.

dukeyukey 3y ago

> often with just 1 month notice periods This is mostly not the case - a 2-month notice period is way more common. It might not even be legal with a typical shorthold tenancy.

FirmwareBurner 3y ago

>Leases are often indefinite How common is that today? In Austria most landlords stopped offering indefinite leases a long time ago, and are instead renewed every 3 years or so when they can increase your rent or kick you out. Or if you have an indefinite lease it's automatically indexed by inflation which screws you big time if your wages aren't keeping up. The only indefinite lease currently in existence without inflation indexing are very old contracts who got grandfathered in but no landlord is crazy to offer that today anymore.

whstl 3y ago
I don't think this is common in Berlin anymore. My last 3 leases had a limit of 3 years. My friends are all in similar situations. It is not difficult to renew, though, but there will be a price adjustment. I eventually caved and bought an apartment.
ManBeardPc 3y ago
In my experience indefinite is pretty much the default here in Germany. I only heard about limited leases for students that only move to a certain location because of university.
- sumuyuda 3y ago
  A fixed term lease in Germany is only legal in some narrow circumstances and can’t be renewed multiple times in a row. I think after a few years the landlord has to offer you an unlimited lease.
  - seanmcdirmid 3y ago
    Are German leases indexed to inflation at least?
    - ManBeardPc 3y ago
      Haven't met anyone which such a contract. It's usually a fixed value. The owner may choose to raise it every now and then, but laws limit it to a certain amount per year and there needs to be a reason, for example modernization or other buildings in the area are becoming more expensive. You can of course make a contract that allows for automatic raises, but that is also limited (earliest 12 month after the begin of the lease, only a fixed/absolute value and not percentage) and you can no longer raise the price for the other reasons. There are probably other models, but I don't know much about them.
ce4 3y ago
Indexed and contracts with stepped rent are also a thing here, especially for sought-after zones/cities. I e.g. avoid those if possible and we've moved out of an (inflation) indexed lease contract recently. Now back to just a regular (non-stepped/indexes) indefinite contract as usual. As to why we dont buy: We like the flexibility and also property prices here make it hard to get sth. decent in comparison to renting.

flohofwoe 3y ago

> if they evict you to personally live in the flat as their main residence ...even this is pretty much impossible after 20 years AFAIK.

cassianoleal 3y ago

> Leases are often indefinite I've seen leases in the UK for 999 years. Not rentals though - leaseholds. This is a very odd feature of UK housing. You pretty much go through all the steps of buying a property but in the end all you bought was the right to live in the place until the lease runs out. It also leads to some oddities, like this [0] very cheap flat a stone's throw away from Regent's Park. It's this price because there are less than 10 years left in the lease and I imagine the current tenants/"owners" couldn't renew it. This could happen for many reasons, e.g. the "actual owner" or freeholder wants to raise the lease value too much, or the freeholder couldn't be found. In the latter case I'm not sure what happens, but I imagine it's possible that no one will ever claim the property - and I have no idea in what legal standing this leaves the property. This is the most common form of "ownership" of flats and apartments. Houses are generally "freeholds", which means you actually own the property. [0] https://www.rightmove.co.uk/properties/142789514 https://www.rightmove.co.uk/properties/142789514

robocat 3y ago
> or the freeholder couldn't be found When does squatting rights become in play? What happens if a leaseholder doesn't move out? Do freeholders have extra rights to kick people off property beyond what landlords do?
pimterry 3y ago
This is currently part of a big political debate, and _might_ change, although the current government have dodged it so far: - https://www.bbc.com/news/uk-politics-67569517 https://www.bbc.com/news/uk-politics-67569517 - https://commonslibrary.parliament.uk/leasehold-reform-in-england-and-wales/ https://commonslibrary.parliament.uk/leasehold-reform-in-eng... - https://www.theguardian.com/society/2023/nov/04/labour-promises-rapid-housing-action-after-years-of-tory-paper-promises https://www.theguardian.com/society/2023/nov/04/labour-promi... Much of the rest of Europe & elsewhere heavily uses a commonhold model (https://www.lease-advice.org/advice-guide/commonhold/ https://www.lease-advice.org/advice-guide/commonhold/) where all owners of flats in a block collectively own the shared structure of the block itself, and share responsibility for maintaining that as required, with a communal budget and democratic voting on decisions.

throwawayyy9237 3y ago

Isn't this changing soon (or at least when the Renter's Reform Bill passes[1])? Contracts will not have fixed terms anymore and "no-fault" evictions will be illegal. Those are two main ones I think. [1] - https://bills.parliament.uk/bills/3462 https://bills.parliament.uk/bills/3462

ahaferburg 3y ago

There's also the high transaction cost. https://www.iwkoeln.de/fileadmin/publikationen/2016/310521/IW-Kurzbericht_72_2016_Transaction_Costs.pdf https://www.iwkoeln.de/fileadmin/publikationen/2016/310521/I... > The cost of a real estate agent would increase the transaction costs considerably; but since the use of housing brokers is not mandatory, they are left out of the calculation. Could somebody with more insight than me comment on the total transaction costs? To me it seems like this is one of the main reasons for people to refrain from buying, because it locks them in. Also, in Berlin at least, prices for buying are skyrocketing. Rents are increasing as well, but probably can't increase as much because of protections.

tharmas 3y ago

So what happened to Berlin? It went to a nice cheap affordable city to an Anglo style neoliberal nightmare. I realize it got popular and people moved there but if there are such renter friendly laws in place how did Berlin end up like it did?

seanmcdirmid 3y ago
I don't think any rent control/relaxed zoning regulations can survive popularity with new residents that have substantial buying power. Berlin was cheap for so long because it wasn't popular, but it had everything to be popular, and so eventually would be. Tokyo would be the same if salaries/wages in Tokyo weren't so depressed.