The housing situation in major German cities has been one for years important topic on the political agenda. A keyword that inevitably comes up: gentrification. But what exactly does that mean? And how does it come about? What problems are associated with it and what can to be done against them? That’s what they’re talking about iib– Managing directors Katarina Ivankovic and Peter Hettenbach in Personal-Financial.com’s real estate podcast.
Berlin-Kreuzberg, Cologne-Ehrenfeld, the Schanzenviertel in Hamburg, the Bahnhofsviertel in Frankfurt or Mannheim-Jungbusch – examples of the phenomenon of gentrification can be found in many large cities. At the beginning there is a low-income and socially disadvantaged district. The low rents attract students and artists, adding value to the area. Investors eventually become aware of the neighborhoods, property prices are rising – and the low-income can no longer afford to live there.
Investors aren’t the problem
“It doesn’t necessarily have to be bad when such a development is initiated,” says iib managing director Peter Hettenbach, referring to the condition of some properties before gentrification. The problem is not that the district is being upgraded by investors, but that the lower-income people are being displaced because affordable housing is shrinking and they have to move to other parts of the city as a result. “Gentrification favors ghettoization,” says Katarina Ivankovic. And Peter Hettenbach agrees: “Social explosives are created. That harms the rich too. Monocultures are stupid on both sides. “
What can be done about it? “If you leave it to economic forces, if you let it grow as it just happens, then that automatically leads to a problem,” says the iib managing director. Measures need to be taken to enable the lower income population to keep their homes even if the neighborhood is upgraded.
You can find all episodes directly at Audio Now, Apple or Spotify or via Google.