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The City With the World's Toughest Anti-Airbnb Laws

Months after passing tight restrictions, Berlin still has plenty of vacation apartments available. But the tide could be turning.

Tenements near the subway station at Mehringdamm, Berlin. (michael.berlin/Flickr)

On May 1, Berlin effectively banned short-stay vacation apartments. In a city where affordable housing is hard to come by, the feeling was that Airbnb and similar platforms were hogging too much space, taking what could be well over 10,000 homes off the regular rental market.

The new law allowed some loopholes. Landlords can still legally rent out up to 50 percent of a home they actually live in, and entire homes can also be rented out under special circumstances. But while Berlin-wide figures are unavailable, the number of such permits granted remains tiny. Meanwhile, fines of up to €100,000 ($106,000) for any landlords or tenants (but not guests) breaking the law make this the toughest crackdown on vacation apartments anywhere in the world. The question is, has it worked?

The German media says no, and there is some evidence to back them up. If, as a random test, you use Airbnb’s location map and focus in on the subway station at Mehringdamm, an area considered highly desirable to live in, you can find more than 200 apartments available for February 2017 within a 10-minute walk. If this is a city where vacation apartments are banned, then something is seriously awry.

Look at the available data, however, and a more complex picture emerges. If, like this Berlin blog, you compare the number of Berlin Airbnb listings now with those available in January 2015, you will find a slightly higher number of offers online now (a little over 11,000). Part of the story behind the rise is that the year running up to the law’s introduction saw a huge jump in listings, which almost doubled in number, to just under 20,000. That number dropped sharply just before the law was introduced, dropping back to around 11,000 offers before ticking upward in late summer and autumn.

Source: Studio Karat. English translation, courtesy of settle-in-berlin.com

It’s clear that the new law has so far failed to eradicate Berlin’s vacation apartment market. It nonetheless seems to have halted its exponential growth. This raises a whole string of questions: Why hasn’t the number of vacation apartments fallen even more sharply now that it’s against the law? Is the new law indeed having an effect that needs more time to unfold? And—a crucial point for cities debating similar measures to consider—is it actually fair? To find out, CityLab talked to four Berlin citizens on different sides of the debate, to see exactly what was going on.

The anti-Airbnb mayor

Mitte Mayor Stephan von Dassel.  (Courtesy Matthias Borowski)

Since being elected mayor of the central borough of Mitte in September, the Green Party’s Stephan von Dassel has taken on the fight against vacation apartments as something of a personal crusade. He’s also sanguine about the purpose of the law. He sees it as more about sending a message that could change the city’s direction than a tool to pursue every single Airbnb host.

“My position is that we need a very strict law, but that the actual pursuing of that law can be quite soft,” he says. “Dealing with the problem of existing vacation apartments is much less important than making sure people realize that the time for buying apartments to rent out to tourists is over. We used to have listings on real estate websites saying ‘ideal vacation rental.’ That is now a thing of the past.”

This might sound unusual, but in a country where landlords’ rights aren’t often given priority over tenants’ rights, it’s not necessarily all that unorthodox. And if any area needs firm action, it’s the borough Von Dassel oversees.

Mitte sits at the heart of tourist Berlin and takes the brunt of the industry’s stress. The borough contains the grand historic streets around the Brandenburg Gate as well as the vast East German-built housing projects and former working-class tenements from the early 20th century. All these different areas and communities rubbing up so closely inevitably creates problems for residents, in terms of both noise and the disappearance of available housing for long-term rent. Von Dassel clearly has little sympathy for the hosts behind Mitte’s recent wave of vacation apartments. He insists (though Airbnb disagrees) that most listings on sites such as Airbnb and Wimdu have been put there by professional landlords who live elsewhere.

“If you look at Airbnb and you see all the photos, I think it’s clear that more than 80 percent of offerings are permanent vacation apartments where nobody lives,” he says. “Even if Airbnb says that the average time an apartment on their site is rented for is 15 days a year, many people offer their apartments on other busy sites such as Wimdu.”

Verifying exactly who is listing what on Airbnb isn’t easy for the city to confirm. Von Dassel says a September 2015 survey found that 90 percent of Airbnb offerings were for entire apartments, rather than individual rooms. Other sources suggest that around 10 percent of Airbnb hosts have multiple listings. According to the website Airbnb vs Berlin, Airbnb’s top 10 hosts in the city (which include real estate companies) account for 244 apartments. This means that the 10 percent of hosts with multiple listings could still feasibly dominate the field. The city wants Airbnb to share the addresses of people who advertise on the platform, but Airbnb says that would contravene privacy laws.

Surely there must be some bona fide owner-occupiers among this group? What about them? Von Dassel answers this concern with a frankness that would be near impossible in the U.S. or Britain.

“Strictly controlling vacation apartments is really a question just for young urban professionals and students—a small, very specific part of society that is a kind of elite,” he says. “Certainly, there are some people who might say ‘I want to spend two weeks in Barcelona or a week in Oslo, but I can only afford it if I [sublet] my flat.’ They are a group I am not worried about. I’m much more concerned with, say, a low-income family who can’t find another room to rent when they have a child.”

Debating the law’s merits is one thing, but it remains irrelevant if it isn’t being enforced. According to von Dassel, it’s the lengthy process of bringing people to court that is slowing enforcement down. Suspected illegal landlords must receive two caution letters, which they have the right to appeal, before they’re finally hit with a court summons.

“The process takes one to two years, so while it seems not to work, we actually have about 1,500 cases in process,” he says. “In a year or so, we will likely have 20 to 30 convictions where—depending on how much income they have made—illegal landlords could face a fine of up to €100,000. This will happen very quickly and send a strong message.”

The angry neighbor

GDR-era apartment buildings on Wilhelmstrasse, many of which have now been partly taken over by vacation apartments. (BrokenSphere/Wikimedia)

Visit Wilhelmstrasse, in the heart of Mitte and just south of the Brandenburg Gate, and you’ll discover a neighborhood where vacation apartments are squeezing out locals at an alarming rate.

Running along the line of the former Berlin Wall stands a long row of slab-like apartments faced with prefabricated panels. Called Plattenbau in German, these utilitarian, characteristically East German structures were built in the final 15 years of the German Democratic Republic. They once housed the East German elite, but in recent years they have been taken over by vacation apartments.

Local resident Daniel Dagan, who leads a campaign against Wilhelmstrasse’s tourist takeover, says that some buildings in the area have 50 to 80 percent of their apartments rented out for tourists. A recent inquiry by the borough of Mitte found that in one Wilhelmstrasse building of 300 apartments, 280 were for short-stay tenants. With that level of tourist traffic, Dagan says residents are seeing increased noise, crowded elevators, garbage in the streets, and more.

“I am not saying that all tourists are bad people, but they come here to party and of course that creates problems for people who live there,” he tells CityLab. “The conditions have changed so much that some people find it too much. Some keep such a strong attachment to the area that they carry on here, but many have already given up and moved away.”

It’s cases like these that pushed Berlin to change its laws. So far, however, Dagan has seen little or no change in Wilhelmstrasse since the law was introduced in May.

“The law is completely ineffective and does nothing at all,” he says. “What we need is more political will to ensure that things actually change. The law in itself is not enough.”

This is the difficult spot in which Berlin now stands. While the number of listings has fallen in some places, enforcement of the new law is so piecemeal and complicated that few areas have seen a significant difference. If von Dassel is right and a host of cases comes to court in a year or so, then the situation might shift. In the meantime, residents in places such as Wilhelmstrasse aren’t holding their breath.

The would-be Airbnb host

Does renting out vacation apartments always have to entail such abuse? In a process that Die Zeit calls “crowd lobbying,” Airbnb has brought together a group of frustrated potential Airbnb landlords into a Berlin “Homesharing Club.” Airbnb-mentored citizen lobbying groups like this have already had some success elsewhere, campaigning against attempts in San Francisco to reduce the annual permissible rental period, an attempt subsequently defeated in a public vote in 2015. While von Dassel suggests that this group gets far more media attention than its size or popularity merits, some Homesharing Club members make a lucid case.

Max, a 31-year-old business consultant, leaves Berlin for work travel about six weeks a year. The one-bedroom apartment in East Berlin’s Prenzlauer Berg neighborhood that he bought 18 months ago would make a perfect vacation apartment—the area’s grand, gentrified art nouveau tenements are now among the most desirable in the city. Because of Berlin’s anti-Airbnb laws, however, Max says he can’t rent his place out without breaking the law. Despite this curb on his potential income, he nonetheless tells CityLab that he­­­ broadly agrees with the law’s intent, just not the way it has been executed:

“Our consensus [at Homesharing] is that what Airbnb does certainly needs to be regulated. We don't want to be associated with people who take housing off the market and turn it into vacation rentals without getting approval,” he says. “What we are against is throwing all landlords together. We are being told by politicians from the city is ‘this law was not meant for people like you’—even from politicians who voted for the law—but whether or not that is true, we are being affected.”

Max, who prefers not to give his full name because he is already somewhat overrun with queries about Airbnb from local residents, also resents what he sees as demonization of people like him by the authorities.

“In an interview Mayor von Dassel called people like me ‘collateral damage of the law,’” he says. “Quite frankly, that is a very offensive attitude, because his law has a grave impact on my personal property.”

Instead, Max is calling for softer alternatives to the current law, such as a 90-day limit on renting out an apartment.

“This is an economically challenged city, where 20 to 25 percent of households in the city are directly or indirectly receiving some sort of social welfare. I'm not saying that these are typical Airbnb hosts, but I think some people are seeing this as a chance of making some money,” he says. “Personally, I am a middle-income guy, but there’s no doubt that renting my flat out would help me with my housing costs. it is certainly not the case that I am taking housing space off the market—though that is something that is still possible under the new law. People can rent a three-room apartment then put one room on Airbnb, which otherwise they would get a roommate for.”

The (almost) legal Airbnb host

A banner protesting rising rents in the Kreuzberg neighbourhood. (quapan/Flickr)

Max’s situation is, as he freely admits, somewhat different from many current Berlin Airbnb hosts. Not only does he own rather than rent his home, he obeys the new law while neighbors around him are breaking it.

The case of X, an existing Airbnb landlord contacted by CityLab, lies somewhere in a gray area between the two sides. X sticks within the city’s guidelines by renting just one bedroom in his three-room apartment, and only when he is in town. Living in a spacious, light-filled flat in the hip Kreuzberg neighborhood where he also grew up, he typically finds his spare room gets booked within hours of being listed.

He nonetheless keeps the listing a secret from his landlord, he says, because the building’s owner is trying to get him out of the rent-controlled apartment and is already looking for an excuse to do so. This is a common enough situation in a city where neighbors often pay strikingly different amounts for their flats depending on how old their contract is. Likewise, the belief that the landlord is entitled to nothing beyond the agreed rent is also common in a country with a majority of renters and where tenants’ rights come before those of landlords. Seeing the neighborhood where he grew up and still lives change extremely fast, X  is not against the spirit of the law either.

“I am worried about rising rents myself, and I see the effect they are having on people in the neighborhood I grew up in. In Kreuzberg and neighboring Neukolln, it seems particularly to be older people and Turkish people who are suffering most,” he says. “They get eviction notices from their landlords and in many cases they could fight them legally, but they don’t know how. So instead they get pushed out to places like Marzahn [on Berlin’s far eastern fringe], where their community links are all gone.”

Despite this worry, X himself doesn’t feel responsible for contributing to the changes he’s seen sweeping his neighborhood, because he is not short-term renting a room that would otherwise have a long-term tenant. Nor does he necessarily see Airbnb as the villain.

“In my neighborhood, everything changed long before Airbnb arrived,” he says. “I chose to stay in Kreuzberg in the 1990s because it was cheap and the center of alternative Berlin at that time. Now we have crowds all the time and the bars are spilling out with people every night, and my new neighbors are paying three times my rent. This didn’t happen because Airbnb arrived.”

X says he puts in the work to host his guests, lives alongside them while they’re visiting, and wouldn’t look for a roommate even if he couldn’t use Airbnb.

“I am using Airbnb because, why shouldn’t I get some benefit from living in this area too now I have to put up with all the new crap?” he says. “As for the landlords, I don’t see they have any right at all.”

When it comes to neighborhood nuisance, X takes his role pretty seriously, vetting potential guests as carefully as possible to make sure he and his neighbors avoid the antisocial.

“I don’t want to attract the sort of people who shout in the street or vomit in the stairwell,” he says. “In fact, if I see people acting like that in the street, I often shout at them in my broadest Berlin accent to shut up.”

A template for other cities?

Talking to different parties affected by Berlin’s anti-Airbnb laws doesn’t create a picture in sharp contrast, but one in many shades of gray. The laws may not have taken full effect, and could reasonably be criticized for being too harsh. They nonetheless appeal to a sense of fairness that most Berliners agree with, even if there is no automatic consensus as to what boundaries should be placed on the quest for housing for residents before tourists.

Could other cities learn and possibly adopt similar laws themselves? Mitte’s Mayor von Dassel says he is in regular contact with authorities in Amsterdam and Barcelona, who find that their own measures against vacation apartments don’t go far enough and may consider adopting laws like Berlin’s.

The limitation is that Berlin and Germany’s debate over vacation apartments takes as its basis a specifically national understanding of the rights of the landlord. The idea that apartments must be places to live first and profit-making investments second is highly unusual in most countries (though owning real estate is still highly profitable in Germany), even though many governments pay the shallowest of lip-service to the idea. Laws that restricted landlords’ abilities to capitalize on their investments would thus be far harder to push through in a more landlord-friendly city such as London.

Meanwhile, Berlin’s still-high number of available apartments is making the law look more than a little toothless, possibly deterring the likes of Homesharing Club members, but doing little to dissuade many others. Still, with only seven months elapsed since the law went into effect, the city will need at least another year to calculate its effectiveness. For now at least, Berlin’s response remains one to watch closely—if not as a solution to an ever-swelling short-stay sector, then at least as an experiment in bringing it under control.

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