By Andrej Holm

[This article published in January 2013 is translated abridged from the German on the Internet.]

Like other products of capitalist goods production, apartments are objects of capital exploitation by private actors. The sale and rental of apartments is a merchandise-related business. As interest-bearing capital, a rental flat should guarantee the highest possible interest return to the owner. Unlike most other commodity markets, the public authority intervenes with local and state housing policy at different historical times and with different ideas about political regulation in this market. In crisis times (like after the Second World War), drastic incursions in the private housing market (rent freeze and forced rationing of living space) had and have a clear political-economic component.

Building social housing played a special role in postwar Germany. State subsidies for building private apartments occurred under the condition of a limited rental price restriction. The goal was repairing an extreme housing shortage considered temporary. Interventions of this kind are oriented in the interest of the economy in low wages and a low rental burden (for which a part of the wages must be spent). In the meantime, building social housing did not play a role anymore. The housing market was almost completely privatized (e.g. the Council-Housing programs in Great Britain during the Thatcher era). As a result, affordable living space became ever-scarcer in metropolitan areas.

The number of residents and the number of seekers of affordable living spaces rises in many big cities. At the same time, the number of affordable apartments has clearly declined in the last years in all economically-strong cities. The reasons for this are varied: withdrawal of the state from public construction of rental housing, reduction of the supply of inexpensive rental apartments by phasing out occupancy obligations, sale of communal housing stock to investors with high profit expectations, supply-reductions as a consequence of measures modernizing and upgrading older and often lower-priced old existing buildings and conversion into expensive apartments or condominiums stimulated by state funding policies (like tax incentives etc)… Building inexpensive apartments does not yield enough profits…

Higher rental prices and supply shortage are two recent developments: rentals for well-paid employees and leasing apartments as vacation housing for urban visitors and tourists.

A further reduction of the supply of affordable apartments through higher rental prices reflects the relatively arbitrary demarcations of the rent levels applied in some cities. This is also an expression of a changed perspective of many local politicians. The supply of apartments is seen as a means of promoting the economy and the location and no longer as part of a local community social policy: with corresponding demands in quality and features.

A continuously growing need for these apartments faces a reduced supply of affordable apartments. The social and economic division of cities has increased in the last years. The share of households with trifling incomes (mini-jobbers, part-time employees and receivers of social security) is high in the big cities.

The shortage of low-priced apartments in more and more big cities provokes increasing criticism in the media and with a number of local politicians. Strategies like public subsidies for building social housing with occupancy obligations, occupancy rights in private housing etc. known from earlier housing emergencies are discussed as possible housing policy reactions. Building an affordable housing stock in communal management – in the sense of an infrastructure achievement – is not on the agenda today. This contradicts the dominance of free enterprise housing supply and not only the basic ideology of German housing policy. It seems to be a consequence of another ideological assumption. In this perspective, there cannot be a broad permanent class of low-income households as a result of the capitalist economic mode. Instead, the current housing need is segmented into special groups like households with temporary socio-economic problems.

The example of communal housing construction in Vienna shows government housing policy can go different ways in crisis times. The Vienna history also shows that strong external pressure is necessary: from the side of other capital fractions that have an interest in low rents in the sense of lower wage levels to ensure international competitiveness and secondly from the side of housing seekers. This pressure does not currently exist. Warning references to the political consequences of social divisions are isolated. On the side of housing seekers, a colorful spectrum of renters and renter initiatives face other conflict parties (owners of housing). There isn’t a well-organized Vienna working class with explicit political goals. Therefore, building a city-wide or (supra-) regionally organized political rental assistance seems necessary.

Housing cooperatives are often seen as another possibility for improving the supply of affordable living space. Acceptable and stable rents are possible here since such housing stocks serve the needs of their members and not the realization of high profits…

Housing is a basic need that cannot be adequately satisfied by the market. Great investments are necessary that cannot be made by many private parties. A rental housing system is imperative. This assumes a sufficient supply of affordable living space that has never happened. This problematic is actually intensifying since much profit-seeking capital flows into building high-priced apartments. In the scope of so-called gentrification, this leads to further displacement of the poorer parts of the population from downtown areas and intensifies the social segregation. Homelessness also increases.

Many examples of house building by the public authority show the dominant goal was not making available affordable housing. Rather, housing policy was only a means for pursuing other political ideologies…

All this points to a peculiarity of housing as social infrastructure. Housing makes possible specific social relations and lifestyles. Housing creates social connections, divisions and separations (ghetto formations, social apartheid) and does not only mean having a roof over one’s head. Since housing is intensely connected with social lifestyles, it is marked by individual preferences and cannot be standardized like for example health care, education and transportation.

Housing as Social Infrastructure

Free living space is not possible on account of high costs. Free space would also force a regimentation and control that would be hardly desirable. Thus, supply conditions on the market must be influenced by the citizenry and self-organized projects supported. The central concern can only be ensuring an adequate and affordable supply of housing for all parts of the population and sufficient possibilities for individual creativity. Housing as infrastructure can not mean guaranteeing the same basic supply for everyone since this would necessitate considerable controls and rationing. An individual right to a certain living space (size, amenities) cannot be guaranteed.

Necessary measures, different situations and needs must be considered.

Housing as infrastructure concentrates on an area that cannot be commodified. No “community” whether a commune, a cooperative or a syndicate can satisfy the need for luxury villas or second or third homes of the global elite. Analogous arguments can be made in “education” and “health care.” “Plastic or cosmetic surgery” or education programs oriented for “higher careers or professions” are market-oriented and not part of the social infrastructure.

Only a certain market segment can be understood as infrastructure, not housing altogether. Providing lower-income sectors with affordable living space is vital. This provision has been a constant problem beginning with industrialization since the spatial concentration of production as well as the urbanization growing by leaps and bounds. Supply bottlenecks now exist in Germany at a number of locations even in economically strong big cities. Financially weak population groups are especially impacted.

Housing as social infrastructure cannot be supplied free of charge. Maintenance and depreciation must be covered through rents.

The central moment of housing as social infrastructure can only be communal housing or house-building by social building companies. This could be joined with a decentralized urban planning and accommodation planning mindful of the needs of residents. Legal and institutional presuppositions for a democratization of urban planning could be adopted. Citizens participate in the organization of parts of the city. The community or property developers must be financially solvent. The goal is affordable living spaces for everyone. Such urban planning efforts meet the needs of the middle- and upper-classes. An alternative to “satellite cities” and inner-city ghettos exists in the communal house-building in Vienna. The (massive) apartment buildings were integrated in streets reflected the principle of “mixed development”: a local infrastructure in the form of autonomous community- and youth centers and businesses is part of this mixed development. A close connection to the predominantly local health centers exists here.

A need-oriented infrastructure with collective spaces can also be considered internally by including residents in planning the (re-) building. These collective spaces include shared washrooms, shared kitchens, shared washing machines, workplaces enabling residents to afford renovations and maintenance… Residents should do everything but are not obligated to participate in collective decisions. The principle of organization is simple and well-known: cooperative forms can be used in the multiparty system. This extends from tools and household appliances (from drilling- to the already mentioned washing machines) to different activities of residents, whether cooking, passions for gardening or artisan skills.

Promoting self-governed housing projects that are not profit-oriented is one of the necessary measures. The syndicates and house associations have a voice and therefore can make common decisions. The residents are financially involved and entitled to use the houses autonomously but cannot sell the individual apartments (or the whole structure as a housing unit) when they want to leave. This arrangement refers to cultural and social resources. Alongside financial support, organization and discussions would be important if this model could be attractive for more than a small subculture.

Life in the city is the starting point for these reflections on housing as infrastructure. The problems are different in the countryside. In areas impacted by the rural exodus, there is hardly a shortage of living space… Community structure could be forced there with an infrastructure including kindergarten, schools and the like. A participatory planning, especially with rededications in development areas is also crucial. In attractive areas, a “repurposing” can be carried out: single-family houses that are only used for sleeping, weekends and perhaps only by one generation. This development has considerable drawbacks. Such housing forms correspond to a “repressive individualism,” as produced and necessitated by current neoliberalism.

Related Links:

Friedhelm Hengsbach, “Housing is not just another commodity,” 2014,  https://www.indybay.org/newsitems/2018/03/06/18807182.php

Andrej Holm, Non-Profits versus Profit Maximization: For a New Social Housing Policy, 2016,