Despite the construction boom in Regensburg: there is still a lack of affordable housing

Created: 02/17/2022, 11:02 am

By: Stefan Aigner

In 2020, Regensburg was in first place in relation to the number of inhabitants when it came to the completion of apartments.

© Michael Bothner

Is the real estate bubble in Regensburg about to burst?

According to a report by the Office for Urban Development, apartment rents are increasingly decoupling from purchase prices.

Although more is being built than ever, these prices continue to rise.

Regensburg - The construction boom in Regensburg*' continues unabated, but it has no significant effect on the purchase prices for real estate: That is a central message of the interim report on the "housing construction offensive", which was presented to the city councilors this week.

Lack of affordable housing in Regensburg: The middle class is being hit more and more

Accordingly, in 2020 Regensburg was the nationwide leader in the completion of multi-storey apartments - according to a study by the Federal Office for Building and Regional Planning, 90 apartments per 10,000 inhabitants were built this year.

Flensburg (67) and Ingolstadt* (61) follow at a clear distance.

And Anton Sedlmeier, head of Regensburg's urban development department, expects similar brisk building activity in the coming years.

So far, however, none of this has been able to remedy the clear lack of affordable housing, which is increasingly affecting not only low-income households but also the middle class.

An almost bigger problem: Apart from Munich*, nowhere else in Bavaria are condominiums more expensive than in Regensburg.

According to the Sparkasse's latest real estate report, a resident of Regensburg had to work for twelve years in relation to the regional average income in order to be able to pay for an average three-room apartment.

In other Bavarian cities it takes eight years, in rural districts it only takes six.

Despite the construction boom in Regensburg: rents are decoupled from purchase prices

As an investment property, such apartments seem to be less and less worthwhile anyway, because the rents for new rentals are increasingly decoupled from the purchase prices.

The latter have more than doubled in the last ten years.

Rents have risen by almost 20 percent over the same period.

According to urban developer Sedlmeier, this can only be partially explained by the high demand and the tense Regensburg housing market.

"Nationwide and also global trends, such as the interest rate policy of the central banks, the actions of international investors in the Regensburg real estate market and rising building and land prices are likely to have had an impact on the Regensburg real estate market."

Almost half of Regensburg's households need more than 30 percent of their income for rent

The number of households in Regensburg that have to spend more than 30 percent of their income on gross rent including heating remains high, albeit with a downward trend and below the national average.

This limit is considered to be “tolerable” nationwide.

According to a study by the Hans Böckler Foundation, which only extends to 2018, 44.5 percent of all tenant households in Regensburg spend more than 30 percent on rent, a quarter of households spend more than 40 percent, with almost 13 percent, more than half of household income is spent on rent.

According to this study, in 2018 only about half of all households lived in rental apartments that were adequate in terms of both size and affordability.

For almost 6,800 households there would be no affordable and appropriate housing even with optimal distribution.

Affordable apartments in Regensburg: demand exceeds supply "many times over"

The city is catching up when it comes to subsidized or rent-controlled apartments, but demand still exceeds supply "many times over".

Demand fell somewhat in 2020 and 2021 - 1,832 households are on the waiting list.

This decline is primarily due to the corona-related contact restrictions, according to Sedlmeier.

"Due to the persistently high rental level, the catch-up effect after the Corona* pandemic and in the course of increased public relations work for apartments in income level III, a further increase in demand is to be expected in the future."