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German Federal Election 2021: What are the parties' positions on real estate?

Germany will be electing a new federal parliament on 26th September 2021. The distribution of seats in the newly elected lower house (Bundestag) will be decisive in the forming of the new government. And the composition of the new government will in turn have a significant impact on the German real estate sector over the course of the next parliamentary term, which is likely to span four years.

The so-called "grand coalition" has been ruling Germany since the last federal election in 2017. The grand coalition is an alliance between the conservative Christian Democratic Union (CDU), together with its Bavarian sister party the Christian Social Union (CSU), and the Social Democratic Party of Germany (SPD). The strongest opposition party is the right-wing populist Alternative for Germany (AfD), which, in terms of its politics, is largely isolated from the other parties, however. At present, it would appear that the liberal Free Democrats (FDP) and the "green" party (Bündnis 90/Die Grünen) could play a key role in forming the next government, while the left-wing socialist party (Die Linke) also cannot be ruled out.

Numerous issues relevant to the real estate sector are at the heart of the parties' election manifestos. The discussion across all parties focuses in particular on climate protection programmes, regulating rents and facing the challenge of creating new living space.

Over recent months, numerous legislative proposals have triggered heated political discussions. These include in particular the "Berlin rent freeze", which has since been ruled unconstitutional, the reform of real estate transfer tax with the aim of rendering share deals less attractive and the Building Land Mobilisation Act, the proponents of which intend, among other things, to offer local authorities greater scope in exercising their right of first refusal. In view of the fact that housing shortages remain a problem, in particular in the large metropolitan areas, and the real estate sector occupies a prominent position in Germany's ongoing nationwide drive to promote renewable energies (Energiewende), it may be assumed that more draft legislation affecting real estate will be floated in the coming parliamentary term.

The following pages offer an overview of the parties' key positions relating to the real estate sector.