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The Two-Prong Freiburg Strategy for Residential Property Promotion

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Listed:
  • Bernd Raffelhüschen
  • Jörg Schoder

Abstract

With the two flank Freiburg strategy, Prof. Bernd Raffelhüschen and Jörg Schoder, University of Freiburg, have introduced a concept for residential property promotion that takes into account the dual function of residential property - provision for retirement and inheritance for children- and the necessity of increased private retirement assets to offset increasing longevity. The basic idea of their reform proposal is to give individuals the freedom to select the type of assistance they wish to use. With a decision for real estate as a form of pension savings assistance is granted in accordance with the German pension law (Altersvermögensgesetz: AvmG), with complete equality given to real estate alongside the already certified retirement plans. By granting equality to residential property, the previous forms of savings assistance (home construction grants and the employee savings bonus) could be replace. If, however, real estate is acquired as a contribution for the provision of the younger generation, this receives assistance in accordance with a "generation grant", but only for families and with a smaller basic grant but a larger child grant.

Suggested Citation

  • Bernd Raffelhüschen & Jörg Schoder, 2004. "The Two-Prong Freiburg Strategy for Residential Property Promotion," ifo Schnelldienst, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, vol. 57(04), pages 3-6, February.
    • Handle: RePEc:ces:ifosdt:v:57:y:2004:i:04:p:3-6
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    References listed on IDEAS

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    1. Auerbach, A.J. & Kotlikoff, L.J. & Weil, D.N., 1992. "The Increasing Annuitization of the Elderly - Estimates and Implications for Intergenerational Transfers, Inequality and National Saving," Papers 6, Boston University - Department of Economics.
    2. Tilman Alexander von Roncador, 2000. "A Future Housing Shortage in Germany?," ifo Schnelldienst, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, vol. 53(10), pages 03-07, April.
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    JEL classification:

    • L85 - Industrial Organization - - Industry Studies: Services - - - Real Estate Services

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