Uncertainty Surrounds German Government's Draft Law to Ban Housing Expropriation

German Chancellor Friedrich Merz announced that a draft law banning the socialization of residential property is complete, though federal ministries have declined to confirm the existence of the text. Speaking at an event organized by the Chamber of Industry and Commerce on November 3, Merz stated that the federal government intends to block expropriation initiatives previously put forward in Berlin by the Left Party, the Social Democrats, and the Greens.

During his address, Merz indicated that cabinet discussions were focused primarily on the exact level of compensation required if expropriations were to occur. He stated that the government needed to decide whether compensation should equal 80 or 100 percent of market value, expressing his support for full market value reimbursement.

Despite the Chancellor's statements, several government entities declined to verify that a completed draft exists following inquiries by the legal news outlet LTO. Neither the government spokesperson nor the Federal Ministry of the Interior confirmed the completion of the bill. Sources familiar with the drafting process told the publication that they had no knowledge of a finished text.

A spokesperson for the Interior Ministry stated that the government is planning an Investment Protection Act for Private Housing, but declined to elaborate on specific provisions. On October 26, a week prior to Merz's speech, an Interior Ministry representative had stated that no concrete draft bill was available. The Ministry of Justice and the Ministry of Housing also refrained from commenting on the current status of the draft.

Legal experts have questioned whether the federal government has the authority to enact a complete ban on socialization, given that Article 15 of the Basic Law explicitly permits the transfer of land into public ownership. Justice Minister Stefanie Hubig highlighted this constitutional complication, noting that while she personally opposes socialization, declaring an outright prohibition is legally problematic. The government has not announced a fixed date for submitting formal draft legislation to parliament.

Written by Sandy van Dongen sandy.vandongen@alpineweekly.com