Unlike Britain, where homeownership is often associated with security, personal independence and the commitment to middle-class values, Germany, until very recently, promoted tenancy as a way of life. This situation harks back to the nineteenth century and is only to a small extent related to the heritage of socialist East Germany. Today approximately 85 percent of Berliners rent their homes (compared to less than 50 percent of Londoners). The ubiquity of tenancy comes with strong tenant protection laws and has significant consequences on the dynamics of urban development: house values and mortgages play a consequently smaller role in urban politics, gentrification cycles are slower, and the homes of most Germans are not at the mercy of a volatile banking sector.
This article will present the historical development of this situation, the consequences on the present housing market and the current debate over homeownership in Germany.
Despite the different and long-established social patterns, there may be lessons here for Britain (and other similar economies) in thinking about the rental sectors, the symbolism of ownership, the regulatory and investment roles of government, and the dynamics of urban change.