It was abolished in 1990 and funding for not-for-profit housing companies is now being restored. Experts hope for more affordable rental prices.
Federal Minister of Construction Geywitz wants to reintroduce the non-profit status of housing construction companies Photo: Hendrik Schmidt/dpa
BERLIN taz | The federal government wants that Non-profit organization for housing construction companies reintroduce. You will then receive a tax reduction if your rent is permanently below market rent. The cabinet decided this on Wednesday. According to estimates by the Federal Ministry of Construction, approximately 100 companies, associations or companies and more than 100,000 tenants could benefit from this. For example, by having company housing built for interns.
The income of the tenants of these apartments may not exceed a certain limit. Federal Construction Minister Klara Geywitz (SPD) said that the income limits have been set in such a way that about 60 percent of all households benefit from the new residential non-profit organization could benefit. Corporate and business taxes will be waived for providers of affordable housing.
Until 1990, non-profit, financed housing companies existed in the Federal Republic. They made an important contribution to the creation of affordable housing in the post-war period. Like that Trade union company Neue Heimat (NH), once the largest non-state housing company in Europe with approximately 500,000 apartments. As a national company, NH’s size and industrial serial production allowed it to build faster, cheaper and better than private companies, initially guaranteeing moderate rental prices.
The NH was largely exempt from taxes. To do this, they had to limit themselves to building small apartments and were not allowed to exceed a certain rental level. In 1972, when the highest number of apartments built annually was reached, namely 22,000, this model was successful and not aimed at profit, but at… The focus is on improving the living situation of broad sections of the population presented.
Scandal surrounding the new homeland
Orders fell due to the oil crisis. New settlements, buildings and even holiday resorts were added abroad. The NH miscalculated. The financial problems became clear when it was discovered in 1982 that boss Albert Vietor and other board members had enriched themselves at the expense of NH. Following this scandal, the black and yellow federal government abolished the extensive tax exemption for non-profit housing associations in 1990, from which municipal housing associations had previously also benefited.
Green MPs, who presented a bill in 2020, considered this “one of the biggest wrong decisions in housing policy since 1945”. The current law also includes the belief that non-profit companies can build cheaper and rent cheaper if they are financially relieved. According to calculations by Links, the rent per square meter for new construction can be reduced by almost three euros.