Cracking Down on Land Speculation: Stettner's Plan to Boost Housing Construction
Increase in Land Speculation Costs Imminent with Stettner's Plans - escalating land gambling costs for Stettner's consideration
In a bold move, the CDU faction in Berlin's House of Representatives is planning to nip land speculation in the bud. Faction leader Dirk Stettner shared with the German Press Agency their intention to expedite apartment construction on developable land, potentially by implementing a new property tax C. "We aim to curb speculation," Stettner stated, "and bring these lands into use, ultimately creating more living spaces."
Following the nationwide reform of property tax, effective since January, Berlin has already augmented the so-called measurement value for undeveloped land (property tax B). Stettner revealed that specialists are currently evaluating whether a new property tax C for planning-ready, developable land would be a more efficient means to motivate owners to construct buildings swiftly. Delaying development could result in increased financial burden for these owners.
Making Speculation Costly
This evaluation must be completed by year's end, according to Stettner. "Our goal is to come up with a solution this year, present an examination result, and then discuss it. We're not discussing whether we want to make speculation more expensive, but rather how we'll do it," he emphasized.
Property tax C is one possibility, but Stettner acknowledged that if another method, such as increasing property tax B and enhancing the measurement value, proves more effective at achieving the same goal in a timely, secure, and legal manner, they would opt for that approach instead. The examination of property tax C is also part of the coalition agreement between CDU and SPD.
Paving the Way for. Hamburg
Stettner drew parallels to Hamburg, where a property tax C has been instituted. While it's premature to draw definitive conclusions about its impact, Stettner estimated that an introduction of such a tax in Berlin would affect between 15,000 and 20,000 plots of land.
The prerequisite for this move would be the creation of a comprehensive registry of all undeveloped, developable land, which would need to be routinely updated. There would likely be exceptions for formally developable land on which construction is either challenging or impossible.
Berlin and other German cities have been implementing various measures to address housing affordability and speculation. For instance, Berlin has implemented rent control measures like the "Mietpreisbremse" (rent cap) to keep housing costs manageable[2]. Hamburg also has policies in place to regulate housing prices and availability. However, specific details about a property tax C in these cities remain scant.
[1] Both Berlin and Hamburg have a transfer tax rate of 6% for property purchases as part of their broader housing policies.
[2] Berlin employs measures like the "Mietpreisbremse" (rent cap) to control housing costs.
- In the pursuit of boosting vocational training opportunities, EC countries might consider implementing a property tax C, similar to what Hamburg has done, to discourage land speculation and make planning-ready, developable land more affordable for vocational training centers and businesses.
- Apart from property tax C, German cities could also explore other methods to curb land speculation, such as increasing property tax B and enhancing the measurement value for undeveloped land, as a means to finance vocational training facilities, promote general-news discussion, and maintain political stability in business and finance.
