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Most private construction is dedicated to luxury condos because that's where the big money is. If you let the "market" decide on its own it will always decide o

Most private construction is dedicated to luxury condos because that's where the big money is. If you let the "market" decide on its own it will always decide on the most profitable items, even if that's not what is needed.

vrganj 5d ago
Yes. The market is a great optimizer, sure, but the question is always what do you actually want to optimize for? And that might not always be the same optimization function as a market.
aurareturn 5d ago
Define "needed". Those luxury condos will still have people living in them whether it's a renter or owner.
- vrganj 5d ago
  Well, that's what a democracy should be used to decide, since people might have different things they want to optimize for. Personally, I believe Berlin has more issues with a lack of affordable housing than with a lack of luxury condos.
  - bluecalm 5d ago
    Adding luxury housing helps with supply of affordable housing. Just a few citations I quickly googled: https://www.sciencedirect.com/science/article/abs/pii/S0094119021000656 https://www.sciencedirect.com/science/article/abs/pii/S00941... https://www.sciencedirect.com/science/article/pii/S0094119022001048 https://www.sciencedirect.com/science/article/pii/S009411902... https://archive.is/2026.02.23-212725/https://www.theatlantic.com/ideas/2026/02/housing-crisis-rich-poor-building/686086/ https://archive.is/2026.02.23-212725/https://www.theatlantic...
    - vrganj 5d ago
      I'm sure it does, to some extent that is <100%. But the real limit in a city is land. If we want to use it efficiently, we should check what we want to optimize use of that resource for. IMO, in Berlin the most lacking thing is the supply in affordable housing, so it makes sense to optimize for that directly instead of a side effect of some other optimization. Why not build something like Alt-Erlaa? [0] [1] Cities can just build stuff. And if private developers are not as incentivized to invest, that makes it cheaper for the city to do so itself. As somebody from Vienna, it's crazy to me this is even up for debate. [0] https://en.wikipedia.org/wiki/Alterlaa https://en.wikipedia.org/wiki/Alterlaa [1] https://www.youtube.com/watch?v=MxuACFQBwxs https://www.youtube.com/watch?v=MxuACFQBwxs
      - bluecalm 5d ago
        >> But the real limit in a city is land. I am not sure how it is in Berlin. I haven't visited in a while. I think it's too general an assessment though. In many cities the limit is not land but permits - both being permitted to build at all and then build high enough. >>Cities can just build stuff. And if private developers are not as incentivized to invest, that makes it cheaper for the city to do so itself. As somebody from Vienna, it's crazy to me this is even up for debate. I hear a lot of good things about housing in Vienna. Are those city build apartments readily available for anyone? The problem with public housing when I am from is that it turns the city population into lucky few who get access and the rest who not only have to subsidize it but then need to buy on private market themselves.
bluecalm 5d ago
Building luxury condos help with housing market as well. I don't think this is controversial (there are tons of studies that support the conclusion). >>If you let the "market" decide on its own it will always decide on the most profitable items, even if that's not what is needed. How do you define "not needed"? Businesses will build what they can sell - the very definition of needed. The problem is that it's difficult to build. A lot of cheaper housing projects don't get build because some restrictions (like height, number of apartments, parking places) that are not necessary.
bryanlarsen 5d ago
Most of the affordable rentals in my city and many others is luxury housing that was built ~100 years ago. They built lots of cheap housing back then too, but it was junk that was torn down a long time ago. The luxury stuff was built better and lasted. The affordable housing from ~50 years ago was single family housing and is crazy expensive today. We should be building lots of high density luxury condos today. Those are the affordable apartments of the future.

vrganj 5d ago

Yes. The market is a great optimizer, sure, but the question is always what do you actually want to optimize for? And that might not always be the same optimization function as a market.

aurareturn 5d ago

Define "needed". Those luxury condos will still have people living in them whether it's a renter or owner.

vrganj 5d ago
Well, that's what a democracy should be used to decide, since people might have different things they want to optimize for. Personally, I believe Berlin has more issues with a lack of affordable housing than with a lack of luxury condos.
- bluecalm 5d ago
  Adding luxury housing helps with supply of affordable housing. Just a few citations I quickly googled: https://www.sciencedirect.com/science/article/abs/pii/S0094119021000656 https://www.sciencedirect.com/science/article/abs/pii/S00941... https://www.sciencedirect.com/science/article/pii/S0094119022001048 https://www.sciencedirect.com/science/article/pii/S009411902... https://archive.is/2026.02.23-212725/https://www.theatlantic.com/ideas/2026/02/housing-crisis-rich-poor-building/686086/ https://archive.is/2026.02.23-212725/https://www.theatlantic...
  - vrganj 5d ago
    I'm sure it does, to some extent that is <100%. But the real limit in a city is land. If we want to use it efficiently, we should check what we want to optimize use of that resource for. IMO, in Berlin the most lacking thing is the supply in affordable housing, so it makes sense to optimize for that directly instead of a side effect of some other optimization. Why not build something like Alt-Erlaa? [0] [1] Cities can just build stuff. And if private developers are not as incentivized to invest, that makes it cheaper for the city to do so itself. As somebody from Vienna, it's crazy to me this is even up for debate. [0] https://en.wikipedia.org/wiki/Alterlaa https://en.wikipedia.org/wiki/Alterlaa [1] https://www.youtube.com/watch?v=MxuACFQBwxs https://www.youtube.com/watch?v=MxuACFQBwxs
    - bluecalm 5d ago
      >> But the real limit in a city is land. I am not sure how it is in Berlin. I haven't visited in a while. I think it's too general an assessment though. In many cities the limit is not land but permits - both being permitted to build at all and then build high enough. >>Cities can just build stuff. And if private developers are not as incentivized to invest, that makes it cheaper for the city to do so itself. As somebody from Vienna, it's crazy to me this is even up for debate. I hear a lot of good things about housing in Vienna. Are those city build apartments readily available for anyone? The problem with public housing when I am from is that it turns the city population into lucky few who get access and the rest who not only have to subsidize it but then need to buy on private market themselves.

bluecalm 5d ago

Building luxury condos help with housing market as well. I don't think this is controversial (there are tons of studies that support the conclusion). >>If you let the "market" decide on its own it will always decide on the most profitable items, even if that's not what is needed. How do you define "not needed"? Businesses will build what they can sell - the very definition of needed. The problem is that it's difficult to build. A lot of cheaper housing projects don't get build because some restrictions (like height, number of apartments, parking places) that are not necessary.

bryanlarsen 5d ago

Most of the affordable rentals in my city and many others is luxury housing that was built ~100 years ago. They built lots of cheap housing back then too, but it was junk that was torn down a long time ago. The luxury stuff was built better and lasted. The affordable housing from ~50 years ago was single family housing and is crazy expensive today. We should be building lots of high density luxury condos today. Those are the affordable apartments of the future.