Housing Vacancies in East German Cities: A Problem not only for Housing Policy

In numerous East German cities extreme imbalances in the housing market have developed with the consequence of extensive housing vacancies. Primarily inner city housing units constructed in the late 19th and early 20th century and housing units constructed within the period of the socialist regime are concerned. The causes for these imbalances can be found in decisions of socialist urban planning, in demographic factors, in oversized federal promotion of new housing construction after the German unification, and in income increases of private households. The commission “Structural Change in the Housing Economy of the New Länder“, installed by the federal government, has examined this problem and submitted preliminary political recommendations on the federal level in order to reduce the housing market imbalances. The commission recommends federal subsidies for tearing off vacant housing units within a period of ten years. A measure like this raises the question how the risk can be handled that too many flats are torn down. In addition, the commission recommends to double the subsidies for households acquiring already existing flats for own use and to halve the subsidies for households investing in newly built owner-occupied housing in East Germany. These incentives to acquire existing housing units might prove too weak because of the strong preferences of East German households to live in single-family houses. Measures on the federal level can support but cannot replace necessary concrete planning and solution strategies in the vacancy-plagued cities “in situ“.

15. February 2001

Authors Peter Franz

Also in this issue

Current trends – Fiscal situation in the New Länder in 1999 in billion DM

Kristina vanDeuverden

in: Wirtschaft im Wandel, No. 2, 2001

read publication

Effects of the new vote weighting system at EU Council of Ministers on structural fond resources for new members

Martina Kämpfe Johannes Stephan

in: Wirtschaft im Wandel, No. 2, 2001

Abstract

At the recent Nice summit, the EU council of ministers decided on institutional adjustments for the European Union. Such reforms are of particular importance for an enlarged European Union in which up to 27 new members could participate. Amongst the reforms, two decisive changes concern the distribution of votes in an enlarged council and additional conditions which will be attached to majority decisions. This redistribution of power within the council will effect in particular economic issues, as e.g. the size and distribution of structural funds budgets to be expected upon admittance as EU-member states. Such effects can be estimated by use of models of probability of coalition-building. The model used here predicts that the budget for structural funds for the ten accession countries will be lower than would have been under the old voting power regime. This highlights that the accession group in Central East Europe lost relative voting power via coalitions in comparison to the voting regime prior to Nice. Solely Poland enjoyed an increase in voting power which also suggests an increase in budgets Poland can now expect to receive in the framework of EU structural funds policy.

read publication

East German Manufacturing: Strongly differentiated if branches and firms are distinguished

Joachim Ragnitz

in: Wirtschaft im Wandel, No. 2, 2001

Abstract

The East German manufacturing sector is characterized by a strong differentiation that cannot be seen in aggregate figures. On the basis of highly disaggregated figures that distinguishes by branches and firms as well it is shown that neither in decreasing industries (like the clothing industry) all firms are faced with a decline in production nor in growing industries (like fine mechanics) all establishments can really participate in growth. It is argued that there is still an intensive selection process in the East German economy that will help to reach a higher level of competitiveness.

read publication

Whom to contact

For Researchers

For Journalists

Mitglied der Leibniz-Gemeinschaft LogoTotal-Equality-LogoWeltoffen Logo