RIGHTs, not REITs! - Right to Housing instead of Right to Profit

At Friday, March 23, the German Bundestag in Berlin will finally decide on the permission of the disputed tax-exempt real estate companies, REITs (Real Estate Investment Trusts). At this occasion HABITAT COALITION INTERNATIONAL(HIC) – a worldwide coalition for the right to housing - and TENANT FORUM RUHR – a coalition of tenants associations in the Ruhr Metropolitan Area - call for a stop of neo-liberal promotion of financial speculation in the housing and real estate sector.

„Instead of more liberty for speculative financial assets we need world-wide policies, which realize the human right to decent housing, work and life“, the organizations stated. „A YES to REITs in Germany would be another dramatic step subjecting the housing markets to the globalized financial markets. A NO to REITs in Germany would be a signal that the financial lobby not everywhere can succeed against social concerns and the human rights obligations of the states.“

Since the 90ies concentrated lobbying of the global financial industry succeeded in introducing the US-model of REITs (which combines high distributions of profits with tax exempt) to more than 20 countries with developed or developing real estate and capital markets. HIC received dramatic reports on the consequences of REITs in the housing sector.
Because of the obligation to high distribution of profits and stock exchange listing REITs are forced to gain high net yields from the housing stocks which do not allow long-term social management. Depending on the market environment, the legal framework and the specialization of the REITs, the residential REITs sector in the U.S. shows a strong neglect of maintenance, rent increases above average, constant sales and fusions or eviction of tenants in favour of expensive apartment complexes. In Venice, California, tenants were evicted, because the owner, the large REIT AIMCO, wanted to tear down a historic social housing complex for dense and expensive condominiums. In Canada HIC members concluded that rents in complexes taken over by REITS clearly increased more rapidly than average.
The high-grade speculative Spanish real estate capital invests into the liberal French REITs as tax haven, a model which in the meantime was also used by the US major bank Morgan Stanley for former ThyssenKrupp dwellings in Germany.

By publishing such examples and by the accelerated introduction of REITs in Great Britain, India, Pakistan, Honkong and Malaysia during the recent years REITs become a symbol for financial market-driven globalisation of housing stocks and land property markets. However, they are merely the peak of an iceberg of badly directed and uncontrolled investment liberty.

Demanded and promoted by the World Bank and donor countries, privatisations of public goods and services in many poor countries and cities has led to devastating consequences for water supply. Private water services for economic reasons must insist on cost-covering service fees, which cannot be paid by poor populations. The easy access of international enterprises to liberalized land markets allows them the private appropriation of former publicly owned water and soil resources. Large-scale projects in private-public partnership pretty often lead to displacements of the native population. An example is the Parota dam project in Mexico.

During recent years HIC had noticed an alarming aggravation of mass evictions, because self built settlements of the poor population (estimated 1 billion humans live in so-called “slums“) were demolished for development projects, urban entertainment zones, touristic attractions or manufacturing plants. Uncontrolled large investments in the emerging markets of Eastern Asia and India have particularly dramatic effects. In India for instance the populations of foreign trade zones become affected by evictions. In addition China, Zimbabwe, Nigeria and a couple of other Asian and African countries are the front runners in forced evictions against human rights obligations.

“By such policies we cannot overcome poverty and we cannot improve the living conditions of at least 1 billion humans, who live under degrading conditions“, HIC president Enrique Ortiz says. “The opposite happens: Everywhere the race of states competing for the most attractive conditions for the financial markets leads to the demolishing of popular neighbourhoods, large-scale projects against the interests of the local populations, unaffordable housing costs and massive evictions of ever larger extent.”

„Housing is an internationally recognized human right. In order to uphold it, we need political regulations, which limit real estate speculation. We need land and housings policies, which are orientated on the social interests of humans. The sell-out of public property and services must be stopped. And we need rights, which protect people effectively from the consequences of speculation. “

HIC in this context reminds the tenants associations and movements in Germany that they do not stand alone in their struggle for social housing. All over the world affected people organize against antisocial housing policies, oppose scruples landlords and real estate vultures, mobilize against incapable municipalities and evictions. Over the last year ten thousands in Spain demonstrated again and again against housing speculation, against rocketing rents and real estate violence. In France a large solidarity movement with the homeless people has forced the government to create regulations for an enforceable right to housing. But without the construction of enough affordable housing and without intervention into the speculative markets the large housing shortage in France cannot be overcome. “France shows why the German tenants are so right to defend their 3 million public housing units and for instance the NRW owned LEG”, Ortiz said. “In industrialized countries, without public housing, there is no right to housing at all.”

Due in part to the movements in Spain and France housing policy became a European topic over the last months. The German EU council presidency however has not mentioned the housing crisis in any way. „For us this is incomprehensible“, Ortiz said.

At the G8-summit in June the most powerful governments of the world plan to talk about freedom and security of international investment. HIC and the Ruhr Tenant Forum demand: “The tenants, the employees, the poor neighbourhoods of the world and the global environment do not need more liberty and privatisations for financial investors. They need social investment and public responsibility for the implementation of the right to housing, work and life.”
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Mieterforum Ruhr is a cooperation of 4 tenants associations in the Ruhr Metropolitan Area.
www.mieterforum-ruhr.de
HIC is a worldwide coalition of NGOs, CBOs and others for the human right to housing.
www.hic-net.org

Mieterforum Ruhr
c/o Mieterverein Bochum e. V.
Brückstr. 58
44787 Bochum
Habitat International Coalition
Santiago Bueras 142, Of.22 Santiago, Chile
Tel/fax: +56-2-664 1393, +56-2-664 9390

Knut Unger ++49-2302-392888 (Speaker Mieterforum Ruhr + HIC board member)

This release was published on openPR.