Expropriation dispute ahead of Berlin election: The Left increases pressure on SPD and Greens

The Berlin chapter of The Left (Die Linke), a German political party, is making the socialization of large housing portfolios — meaning their transfer into public or other forms of collective ownership — a central issue for possible participation in government after the Berlin state election. Elif Eralp, The Left’s lead candidate in Berlin, says that large housing portfolios owned by major real estate companies would have to be socialized if her party enters government and that her position has not changed.

Steffen Krach, the Berlin lead candidate of Germany’s Social Democratic Party (SPD), rejects making socialization a binding condition for a coalition. That does not mean, however, that the SPD or the Greens categorically oppose socialization as such.

German constitutional law also distinguishes socialization from a conventional expropriation. Article 15 of Germany’s Basic Law allows land and means of production to be transferred into public ownership or other forms of public economic ownership by law.

Any such law would have to address compensation and would be subject to constitutional and judicial review. Socialization is therefore not inherently undemocratic.

In Berlin, a majority of participants in a 2021 referendum also voted in favor of drafting legislation to socialize large housing portfolios. Whether such a policy would make sense economically or as housing policy is a separate political question.

Greater public control over housing stock and rents would have to be weighed against potentially high compensation and financing costs and the question of whether the policy would actually create additional housing.