Real Estate News

Should the US adopt a German Building Model?

German is fighting gentrification and building affordable homes by encouraging ‘building groups’.

german housing

Its no secret that affordable housing is a serious situation, especially in urban areas like New York and San Francisco, where even the middle class can barely afford to live and eat. Germany utilizes a technique called ‘Baugruppen’, or building groups to fight this situation. Basically its means that citizens come together to privately design and develop their own apartment complexes, and the result is somewhere between a condo and a commune.

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The idea is that you get a group of friends together, pool your money, and build an apartment building tailored to your own needs. It works by each group forming an LLC, then paying an upfront fee for the down payment on the land, and to find an architect to build the condo. At the end of the process, each person in the baugruppen owns their own condo, and they collectively own the building. Typically, each unit costs about 10-20 percent less per square foot than commercially owned buildings, so its kind of a win-win.

I personally think the US should be moving more in this direction, but what do you think? Would you like to own your own condo with your friends?

german housing

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About the author

Gary Adrian Randall