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Movin' on up? An overview of the housing situation for foreign-origin persons in West Germany -- Anita I. Drever and William A.V. Clark

Movin' on up? An overview of the housing situation for foreign-origin persons in West Germany.[1]

Anita I. Drever and William A.V. Clark

University of California, Los Angeles

(ROUGH DRAFT, PLEASE DO NOT QUOTE)

Abstract


Our paper is concerned with two main questions. First, has housing quality for persons of foreign-origin improved since 1985 in Germany? Second, to what extent are foreign-origin persons able to improve their housing conditions by moving? We find that although housing conditions for non-natives have improved in absolute terms across a wide array of indicators, only in a few instances has the housing quality gap between Germans and non-Germans narrowed. Our analysis furthermore reveals that older Turkish persons are particularly disadvantaged in the housing market. Finally, it appears that persons of foreign-origin generally, and Turks in particular, are moving at increasing rates into buildings with 9 or more units. Throughout the paper we discuss the implications of these findings for minority integration in Germany.

Introduction
Degree of access to quality housing is clearly a critical measure of social wellbeing. If even after controlling for variables known to influence housing type and quality, a group still appears to be disadvantaged within the housing market, it can be surmised that social barriers are preventing these persons from enjoying the equal access to goods and services, at any given level of purchasing power, assumed to exist within capitalist societies. This harms not only the group affected, but society at large because the costs of exclusion often come in the form of social alienation and cultures of resistance[2] the remedying of which through social programs is both difficult and costly.

The results of our analysis reveal that the housing situation for persons of foreign-origin in Germany has improved significantly over time. However, what is worrying is that persons of foreign-origin have made only slight gains in housing quality relative to native-born Germans. This indicates that the current policy framework needs to be amended, by for example enforcing laws which make it illegal to discriminate against non-German renters.

The research here builds on a large literature documenting the position of vulnerable groups in Germany's housing market. Specifically it updates research done during the mid 1980s which found that persons of foreign origin were concentrated in Germany's worst housing either in the aging housing stock (Altbau) in central city areas of near industrial areas.[3][4] In addition it the research updates work done by the authors on patterns of residential mobility for Germans and persons of foreign-origin in the past.[5]


Data and Variables
The German Socio-Economic Panel (GSOEP) is a rich source of information on the housing and household characteristics of approximately 6,000 randomly sampled households.
Of importance to this particular study is the fact that persons of foreign origin were over-sampled in the GSOEP. Initially in 1984, 1393 households of Turkish, Yugoslavian, Greek, Spanish and Italian origin were included in the sample. In 1994/1995, an additional immigrant sample of 522 households who moved from abroad to Germany was added to the GSOEP. As a result, the immigrant sample within the GSOEP captures a broad spectrum of immigrant experiences within Germany
We limited the analysis to households residing in West Germany, as this is where the vast majority of all immigrants live. The research was carried out at the household level because people generally move in household units. In addition, moves which involved household split-offs (ie divorce, children leaving the household) were not included in the before and after move analysis. We felt that including split-off moves would bias the results because these types of moves are more likely to take place in the German population, and they result in different types of housing consumption. Additionally, our study did not differentiate between long and short distance moves.

Other important factors to note regarding the analysis are that all personal characteristics, such as foreign-origin or age, refer to the characteristics of the household head. Income and space per person are adjusted in the regression analysis. This allows us to take into consideration economies of scale with regards to space in larger households and it allows us to adjust for the fact that a household income of 50,000 DM goes much further in a family of two than it does in a family of five. The descriptive analysis compares 1985 and 1998 cross sectional files whereas the regressions and mover analysis are calculated from a pooled data set which includes data from every year between 1985 and 1998.

In the analysis we look at persons of Turkish origin separately as well as at persons of foreign-origin overall. The reason we focus on Turks in particular is twofold. First, in the past Turks faced more difficult housing and economic conditions than persons of foreign-origin overall.[6] Second, Turks are the largest national subgroup within Germany, and the GSOEP immigrant sub-sample, making the analysis of their housing situation not only possible, but also particularly relevant. We also distinguish between different age groups as housing needs and wealth are different at different stages in the life cycle.[7] Finally the descriptive analysis is conducted only on households living in communities of 20,000 or more persons. We focus on the urban population because foreign-origin persons are underrepresented in rural areas and housing tend to be cheaper and crowding less of an issue outside of German cities.

Analysis and results
The analysis proceeds in three stages. In the first stage we compare general housing conditions for persons of foreign-origin, Turks and Germans at two points in time, 1985 and 1998. This allows us to assess the degree to which housing conditions have changed since the mid 1980s for the two populations.. The second stage of the analysis consists of a series of multiple and logistic regression analyses. These analyses allow us to assess whether or not differences found in the descriptive analyses are statistically significant and the models make it possible to control for the variations in socioeconomic factors in the foreign-origin and German population. In the last stage of the analysis we compare Germans, Turks and foreign-origin movers before and after they change their place of residence. The main objective here is to measure the degree to which persons of foreign-origin are able to improve their living conditions through mobility.

Descriptive analysis
Figures 1 and 2 show that major advances have been made in the provision of central heating and private bath between 1985 and 1998. Unlike the housing stock in the United States, a sizeable portion of the housing stock in Germany predates WWII, therefore until recently facilities such as central heating and private bath were not necessarily standard in German housing. Clearly the benefits of urban renewal projects, most of which are state subsidized, have trickled down to such an extent that with respect to these two factors, living conditions for Germans and non-Germans are indistinguishable.

Across all other housing quality indicators significant differences still remain. The graphs for rooms per person (figure 3) and space per person (figure 4) both indicate that persons of foreign-origin remain more crowded than persons of German origin. Also of interest is the fact that although Germans become less crowded as they get older this is generally not the case for persons of foreign-origin or Turks. Information for middle aged Turkish persons in 1-2 person

households was not included because, remarkably, only 8 Turkish households fit into this category. Objective differences in crowding measures are reflected in subjective evaluations of adequacy of space (figure 5). Persons of foreign-origin are more likely to feel the size of their living area to be inadequate, while elderly Turkish persons in 1998 were particularly dissatisfied.


Although nationality does not influence likelihood of living within a building that needs renovation, if one is under the age of thirty five, this is less true for older non-Germans (figure 6). In addition, while middle aged and older Germans feel that their dwellings are in better repair than in 1985, the opposite is true for Turks. It should be born in mind that these changes in subjective evaluations on the part of immigrant families are probably partially due to objective conditions, and partially due to the fact that immigrants assimilate German housing quality expectations over time. We bring this up because the drop in the number of Turkish families in housing without central heating or private bath indicates that significant renovations have taken place.

Earlier research indicates that persons of foreign-origin were more likely to pay more for their housing than German nationals.[8] This appears to still be the case, as is reflected by the fact that persons of foreign-origin are more likely to be unsatisfied with their current rent levels. This is also a strong indicator of unequal access to housing in Germany in that high rents for low quality housing are characteristic of conditions in which housing discrimination is taking place.[9]

It is important to look at a group's distribution within particular housing types as this often indicates the type of neighborhood a group is living in. More and more persons of foreign-origin are moving into buildings with 9 or more units whereas numbers of Germans in these buildings is beginning to drop (figure 8). This trend is especially pronounced among elderly non-Germans. Large apartment buildings in Germany are often located towards the edge of the city and are isolated from services.[10] As in other parts of Europe, economically vulnerable persons such as single mothers, the unemployed and the elderly are becoming increasingly concentrated in these areas.[11] Persons of foreign-origin are likely to end up socially and geographically isolated in these areas.

Since 1985 persons of foreign-origin have become more likely to enter into home ownership and live in housing with only 1 or 2 units (Figures 9 ad 10). However, the gap between persons of foreign-origin and Germans remains substantial and it increases over the period of the life cycle.

Regression Models


The logistic and regression models for the most part merely confirm the patterns observed in the descriptive statistics. The models were set up in to test whether or not nationality remains significant even after controlling for other variables likely to affect housing quality. Therefore each model contains the same socioeconomic and demographic independent variables while the dependent variable for each model is some measure of housing quality. The analyses were performed on pooled data therefore the Huber Standard errors were employed to correct for artificially high significance levels.

Notable is the fact that in every model the foreign-origin variable was not only significant, but the effects were large. This indicates that it was not primarily socio-economic characteristics of the foreign origin population, such as their lower than average incomes, causing them to concentrate in poorer than average housing. Either persons of foreign origin are choosing to spend a smaller portion of their incomes on housing, or factors such as discrimination within the housing market are making it difficult for them to obtain quality housing.

Foreign origin interactions and an owner vs. renter variable were included in the model of likelihood of living within a building of 9 or more units. The reason being that the interactions show that when persons of foreign-origin make the transition to home ownership, this is more likely to occur in large apartment buildings. In addition, larger foreign-origin households are more likely to live in large apartment buildings than larger German families. This is concerning because future generations of foreign-origin persons are especially likely to suffer the consequences of social isolation as a result of their concentration in large housing districts (Großsiedlungen).

Dependent variables


Likelihood of living in a buidlind with 9+ units Likelihood of living in a 1 or 2 unit building Likelihood of living in a building with 9+ units + foreign orig interactions
Independent variables
Odds ratio Odds ratio Odds ratio
Adjusted net income
1.0000
1.0001*
1.0000

Age
.9992
1.0190*
1.0001

Age squared
1.0000
.9999*
9998

Owner vs. (renter)
.2627*
**
.23601*

Foreign origin
1.3431*
.2123*
1.0453

Urban
4.1057*
.1831*
4.1638*

Number in household
.8487*
1.4589*
.77242*

1992-1998 vs. 85-91
1.0408
.9333*
1.0069

Adj inc x foreign orig


.99996

Age x foreign orig


.99214

Age sq x foreign orig


1.0001

Owner x foreign orig


1.2333*

Urban x foreign orig


2.8809

# in household x for orig


1.1358*

Year seg x for orig


.89275


Pseudo R squared
0.12
0.19
0.13


*=significant at the 0.01 level

**= removed because of multicolinearity

Dependent variables
Likelihood of being unhappy with housing space Likelihood of feeling rent level is too high Likelihood of feeling housing not in need of renovations
Independent variables
Odds ratio Odds ratio Odds ratio
Adjusted net income
.99989*
.9999*
1.0002*

Age
.96539*
.9924*
.9981

Age squared
.99950*
1.0000
1.0007*

Owner vs. (renter)
.37057*

1.3728

Foreign origin
1.1487*
1.6750*
.1799*

Urban
1.3645*
1.1992*
.8537

Number in household
1.2673*
1.0503*
1.0600

1992-1998 vs. 85-91
1.5741*
.9771
**


Pseudo R squared
0.11
0.02
0.09


* significant at the 0.01 level

** due to recoding of this variable in the GSOEP, analysis is for years 1992-1998 only

Dependent variables
Adjusted meters per person
Independent variables

Adjusted net income
.0058794*

Age
.1621052*

Age squared
-.007691*

Owner vs. (renter)
25.85012*

Foreign origin
-14.96222*

Urban
-7.565871*

Number in household
-5.965905*

1992-1998 vs. 85-91
-.8813228

Foreign x adj. income


Foreign x age


Foreign x age2


Foreign x # in househ.


Foreign x year seg

Constant
4.7663


R squared
0.35


* significant at the 0.01 level

Results of moves


One can improve the quality of one's housing either through moving or by renovating in place. In our analysis we focus on movers, comparing their living situation before and after a relocation. Movers are critical because their behavior is indicative of demographic dynamics within the housing market. In addition, renovations in place offer only limited potential for improvement. Therefore it is mainly through moving that persons of foreign-origin are going to be achieve gains relative to Germans.

Our analysis reveals that both Germans and persons of foreign-origin improve their housing quality significantly through moving. However, in most cases persons of foreign-origins do not do so to the extent that Germans do. For example, if we look at rooms per person for 1-2 person and 3 or more person households before and after a move (figures 12 and 13), we see that although most groups, except for the elderly, increase their average number of rooms, the percentage increases are greater for Germans.

The percent changes associated with moving in and out of particular housing types are particularly dramatic (see figures 15 and 16). The graphs indicate that moves are likely to result in Turks leaving 1-2 unit buildings while persons of foreign-origin do increase their representation in the 1-2 unit housing stock through a move, but only slightly. On the other hand, moves tend to bring elderly persons generally, and Turks in particular, into 9 or more unit housing.

On a more optimistic note, Turkish persons in particular appear to be able to make especially dramatic improvements in the conditions of their housing facilities when they move (see figure 17). This fact is not independent of their moving into large apartment buildings. It appears that Turks are moving out of pre World War II, poorly renovated housing into large apartment blocks built between the 1960s and 1980s that native Germans are finding increasingly less desirable.

Interestingly, persons are more likely to be satisfied with their rent burden despite the fact that moving is known to be costly in Germany.[12] However, Germans are more likely to become satisfied with their change in rent levels than either persons of foreign-origin or Turks (see figure 14). This is a further indication that it is more difficult and costly for persons of foreign-origin to move.


Conclusion
The analysis of changes in housing conditions over time and the consequences of moving for Germans and foreign-origin persons leads to five main conclusions. The first is that persons of foreign-origins remain significantly disadvantaged in the urban German housing market across a large range of factors. In addition, these differences do not disappear when socioeconomic characteristics are controlled for. Second, persons of Turkish origin remain slightly worse off than persons of foreign origin overall across almost all variables. Third, relative disadvantage for persons of foreign-origin increases with increasing age and older Turkish persons are in a particularly vulnerable position within the housing market. Fourth, moves bring slightly more benefit to Germans and are more costly for foreign-origin and Turkish persons. Finally, persons of Turkish origin are becoming increasingly concentrated in large apartment buildings, an area of the housing market generally considered to be Germany's most geographically and socially isolated.

The policy implications of the research are several. First, consideration should be given to whether or not it is in Germany's best interest to have growing concentrations of Turkish persons in large housing estates. On the one hand, apartments in these large buildings are generally well renovated and larger than those found in the older housing stock in the central city. In addition, Turks are likely to be valuable clients in an area of the housing market where the vacancy rates are relatively high. On the other hand, Turks are having a difficult time successfully integrating into Germany's labor market and educational system.[13] It seems likely that the growing concentration of Turkish families in these housing complexes will have a particularly strong impact on the chances for success in the labor market for Turkish children. Another issue the research brings up is to what extent persons, solely by virtue of their nationality, have a more difficult time accessing housing in Germany. Our findings and past research indicate that housing discrimination continues to exist in Germany. The popular press and even guide books to living in Germany further reinforce this.[14] In addition, it is legal for landlords to discriminate against persons who do not have German citizenship. Housing market barriers tend to foster the growth of an underclass that is separate and resentful of the majority. Policy measure which seek to tackle these issues are likely to bolster other efforts currently underway in Germany to promote integration and enable Germany to better absorb more immigrants in the future.

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[1] We wish to thank the German Institute of Economic Research (DIW) for providing access to the facilities and data used in the research. We would also like to thank Joachim Frick for his helpful comments and suggestions. The research was supported by a grant from the UCLA Summer Research Mentorship Program and through a fellowship from the SSRC Berlin Program.

[2] Clark, K. (1965) Dark Ghetto: Dilemmas of Social Power. New York: Harper & Row Publishers.

Massey, D. and N. Denton. (1993) American Apartheid. Cambridge, Mass: Harvard University Press.

[4] See (1987) Foreign Minorities in Continental European Cities. Eds. G. Glebe and J. O'Loughlin. Stutgart: Steiner-Verlag Wiesbaden.

O'Loughlin, J. (1987) "Chicago an der Ruhr or What? Explaining the location of Immigrants in European Cities."Foreign Minorities in Continental European Cities Eds. G. Glebe and J. O'Loughlin, Stutgart: Steiner-Verlag Wiesbaden.

[5] Clark, W.A.V. and A. Drever (2000) "Residential Mobility in a constrained housing market: implications for ethnic populations in Germany." Environment and Planning A. 32, 833-846.

[6] Gans, P. (1987) "Intraurban Migration of Foreigners in Kiel since 1972." Foreign Minorities in Continental European Cities. Eds. G. Glebe and J. O'Loughlin. Stutgart: Steiner-Verlag Wiesbaden.

[7] Clark, W.A.V. and F. Dieleman (1996) Households and Housing, Rutgers: New

Brunswick, New Jersey.

[8] O'Loughlin, J. (1987) "Chicago an der Ruhr or What? Explaining the location of Immigrants in European Cities." Foreign Minorities in Continental European Cities Eds. G. Glebe and J. O'Loughlin, Stutgart: Steiner-Verlag Wiesbaden.

[9] Harvey, David. (1973) Social Justic in the City. Baltimore: John Hopkins University Press.

[10] Herlyn, Ulfert (1990). Leben in der Stadt. Opladen: Leske + Budrich.

[11] (1999) Urban Renewal, Ethnicity and Social Exclusion in Europe. Eds. A. Khakee, P.Somma, H.Thomas Aldershot: Ashgate.

[12] Schumacher, H. (1992) Einwanderungsland BRD: warum die deutsche Wirtschaft weiter Ausländer braucht. Düsseldorf: Zebulon Verlag.

[13] Münz, R. W. Seifert and R. Ulrich.(1997) Zuwanderung nach Deutschland. Frankfurt/Main: Campus Verlag.

[14] See Lord (1996) Culture Shock: Germany and Baum, A. (2000) „Angst vor dem Osten." Zitty 25, 26-31