What is Gentrification?
In the United Kingdom, the gentry are the highest class of people aside from royalty. When you add –fication (the suffix that means “making”), you see how gentrification means “making something suitable for a higher class of people,”
Therefore, when a neighborhood goes through gentrification, buildings get makeovers, new businesses open. One of the major consequences is that many people who’ve lived there their entire lives must leave. Indeed everything gets more expensive for them to afford. Above all, rent increases and becomes impossible for them to pay. In short, the restoration of run-down urban areas, more than often, results in the displacement of low-income residents.
Enclosed an extensive definition of all aspects of Gentrification (popup).
In the last decade, Berlin has emerged as one of the frothiest property market in the world. Indeed, expensive highrise developments and speculative buying threaten this city traditionally low rents and its social structure.
According to the property consultancy Knight Frank, prices in Berlin jumped by 20.5% in 2017. Since 2004, the average property price has increased by more than 120%. Foreign buyers have flocked into Berlin’s residential and commercial property market. Thanks to cheap 0% interest borrowing deals when investors modernize housing, it guarantees a sure capital gain and therefore quickens gentrification. Above all, a fast growing population helps this boom. Indeed, the city’s population has grown by about 50,000 a year over the past five years to 3.5 million. It should more likely reach 4 million by 2035.
The surge in prices has prompted warnings of a bubble waiting to burst. Last February, Germany’s central bank, the Bundesbank, suggested that property in many German cities was at least 15% overpriced. In Berlin, it could be as much as 35% overpriced. But to buyers from London or New York, Berlin remains cheap even after years of 10% annualised rises. Apartments in prime parts of the German capital fetch only about a third of the price of equivalent-sized properties in London.
Commercial property is also booming. Berlin’s Sony centre complex, emblematic of the city’s regeneration after the fall of the Berlin Wall, was bought for €1.1bn in October 2017 by the pension fund of Ontario’s municipal employees. Meanwhile Norway’s state pension fund has paid about €400m for the Mitte headquarters of media group Axel Springer.
Kreuzberg fights to keep local grocery store…
Over the past 5 years, because of what locals call “rent madness”, people are finally starting to defend themselves. They protest rising rents, forced evictions and rampant real estate speculation : all signs of an unstoppable Gentrification in full swing.
In 2015, Kreuzberg protested in defense of a Turkish family-owned grocery store threatened by eviction. After heavy public pressure, this eviction is canceled. Ultimately,Bizim Bakkal, its owner, decides to give up the store because of health problems that he said had stemmed from the fight with the landlord. The phrase “Bizim bleibt,” or “Bizim stays” became a rallying cry for the wider movement. It gave birth to the Bizim Kiez (popup) organization, which still fights to maintain diversity in the neighborhood.
Under pressure from a growing grass-roots movement (to mobilize locals), the city authorities have put into effect a slate of measures. These include rent caps, a partial ban on vacation rentals, development-free zones and increased social housing subsidies. The goal is to bridle the bullish housing market and conserve the diverse social and cultural makeup of the city center.
An extensive history of this movement here: https://nyti.ms/2QsI5o3