I regularly attend political events because I consider the exchange with politicians important. Real estate experts with practical experience have specific knowledge that helps politicians make more informed decisions. They can gain a better understanding of current market conditions and future trends. Through dialog with the real estate industry, policymakers can take actions that promote economic growth and job creation.
Given the current challenges in Germany's urban centers, such as acute housing shortages, rising rents, and urban renewal, politicians benefit from a successful real estate industry. Providing housing, improving urban infrastructure, and creating jobs increases voter satisfaction. A successful real estate sector leads to high levels of investment in the region, which boosts economic growth and sustainably increases the quality of life.
At this year's summer reception of the Frankfurt SME and Economic Union (MIT), I had an interesting exchange with Dr. Frank Somogyi from the Deutsche Bundesbank, who chairs the Urban Development and Housing Expert Committee at the Frankfurt Union.
There was a consensus that, in the medium term, social housing subsidies should be replaced by subject subsidies, i.e. a reformed accommodation allowance. The result would be that in the future, not just 30% of apartments but 100% of those entitled would be subsidized.
The rent control should be abolished. It is counterproductive and exacerbates the housing shortage. If the price mechanism is suspended, the incentives to create additional living space will decrease.
The building land decision should be reversed. Higher costs for investors mean higher rents and purchase prices for citizens.
Many thanks to Frankfurt MIT District Chairwoman Dr. Veronica Fabricius for a successful summer reception, which was also attended by several members of the Hessian state parliament such as Ingmar Jung (Minister of Agriculture, Environment, Hunting and Homeland) or Tanja Jost.
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