still poor, not as sexy

Perfectly perfect timing! Amazing that the Federal Constitutional Court ruled that Berlin would have to make due being broke without the help of other regions just after elections…  Things are looking quite different a month later. Plans to start paying down 60 billion euros of debt: Free day care? Maybe not as soon as they thought. Tax on real estate purchases – up from 3,5 to 4,5 % of the sale price. More in German here.

Doesn’t sound sexy to me. Foreign investors aren’t really affected by the disappearence of Eigenheimzulage or a 1% increase in the Grunderwerbssteuer. As the Dubliner constantly reminds me during his visits, everything is SO CHEAP (relatively). However, I wonder how things will pan out for renters (mostly everyone in Berlin) in the long run. In just a couple of months, potential individual buyers have watched thousands of euros in government credit disappear, followed by a raise in taxes on the purchase.

Our building is about to become a microcosm experiment on this subject. About a half of the apartments were sold to a new owner, who has spearheaded renovations. Windows are getting redone; the stairwell is being repainted and snazzed up. One can only wonder what happens next.


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