A lot to learn from German real estate

n Germany the floor cannot be delivered in exchange for eliminating the debt that originated. There is no dation in payment. But beyond this coincidence the analogy ends: all the context that has given rise to the controversy in Spain, that is to say, an irresponsible economic policy – the neocaciquismo of the brick of Francoist origins and that the democracy perpetuated – that favors the speculative construction, and a population pushed to the purchase and the indebtedness, they do not occur in Germany.

The dation in payment does not exist, but if the debtor has returned an amount equivalent to or greater than that which they had lent, the debt is considered settled. It will be a judge who will decide. A judge in a country with an agile and operational justice, without the slightest relation to the faulty Spanish judicial turtle. Another important nuance is that in Germany there is the possibility of a declaration of private insolvency.

A natural person can be declared insolvent as a legal entity

Personal insolvency establishes for the insolvent the obligation to dedicate all the income that exceeds the existential minimum to maintain himself, to pay his creditors and for a maximum term of seven years, after which the debt is extinguished and the person can start over. Thus, the declaration of insolvency of the natural person, a figure that does not exist in Spain, is neither a ruin nor a life sentence for the indebted. At most seven years of hardship.

The comparison will be incomprehensible without taking into account the differences in context. That the condition of the rescue of banks, that is to assume their debts with public money, is not to forgive the debt of their mortgaged and bankrupt clients as a result of political and financial irresponsibility, is something that challenges the most elemental sense of decency. No German politician would dare to raise something so blatant.

German banks, which have been great accomplices to many property cases of abuse abroad, will never finance 100% of a flat in Germany. The buyer shall demand at least the deposit of 20% or 30% of its value. And before giving a loan, the applicant’s income will be examined: if the relationship between his salary and the mortgage payment is disproportionate, the credit is denied or more equity capital will be required- this one is worth trying.

Equally incomparable is the situation of the real estate market in which Spanish private indebtedness was cooked. The German market is much more transparent and less prone to speculation. It is more difficult for property prices and rents to become independent of the fundamental data of the economy. If you sell your home before ten years of having acquired it, your surplus will tax you.

Unlike a country with expensive rents and little supply -which together with cheap money pushed the citizen to buy housing- in Germany, there is traditionally an affordable rental market and a public power that practices a much more reasonable balance than Spanish between the rights of the tenant and those of the rentier owner. Each city publishes annually its so-called ” Mietspiegel “, the scale of average rental prices per square meter, with what is known immediately if there is abuse. Rentals cannot be raised above that scale. A trick of the owners to do it, declaring “reforms” in the house that justify increases, has just been nipped in the bud in a particularly speculative Berlin neighborhood (Prenzlauerberg), by the drastic decision to prohibit such reforms.

In Germany, there is also a long tradition of housing cooperatives

social housing construction and wholesale entities specialized in housing rental. For all these reasons, most Germans live in rental housing and are not obsessed with the property that is characteristic of the Spaniards. The sum of that with a state of law between works and is enforced is what marks the essential difference between the primitive and barbarian Spanish panorama.