Because of inflation: the head of Germany's largest real estate group warns that rents will rise noticeably
Created: 2022-06-01 15:28
By: Lisa Mayerhofer
Millions of German tenants have to adjust to rising housing costs.
© Wolfgang Kumm/dpa/symbol picture
The boss of Vonovia, Germany's largest real estate company, speaks of rent increases in view of the high inflation.
The real estate giant owns around 565,000 apartments.
Bochum – Millions of German tenants have to adjust to rising housing costs: Germany's largest real estate group, Vonovia, considers significant rent increases to be inevitable in view of the high inflation rates.
"If inflation is permanently at four percent, rents will have to increase accordingly every year in the future," said Vonovia CEO Rolf Buch to the
Handelsblatt
.
The tenants' association sharply criticized the announcement.
Vonovia announces rent increases - millions of tenants affected
“We can't pretend that inflation is bypassing rents.
That won't work," Buch continued.
The real estate giant owns around 565,000 apartments, most of them in Germany.
The average rent at Vonovia rose to EUR 7.40 per square meter in the first three months of this year – that was 3.1 percent more than a year earlier.
This is still well below the current inflation rate of just under eight percent.
The German Tenants' Association (DMB) sharply criticized the announced rent increase.
"The fact that tenants have to be held responsible for Vonovia's collapsed share price and higher interest rates on the capital market shows that the business models of listed housing groups are antisocial and speculative," explained DMB President Lukas Siebenkotten.
Vonovia already increased rents in the pandemic year 2021
According to this, Vonovia had made a profit of around 1.7 billion euros in the pandemic year 2021 and paid out the highest dividend in the company's history at 1.66 euros per share.
In the same year, according to the DMB, rents in the group's apartments rose by an average of 3.8 percent, in Berlin the rate of increase was eight percent.
Vonovia also took over what was then the second-largest listed real estate group, Deutsche Wohnen, for around EUR 19 billion.
"Now at the latest it is becoming apparent that the flowery announcements by Vonovia's top management in the course of the takeover of Deutsche Wohnen, according to which existing rents should not increase by more than one percent per year, are nothing but waste," criticized Siebenkotten.
Politicians and the cartel office were “led through the arena on the nose ring”.
"In the end, the tenants pay for everything, that's the business model of Vonovia and Co," criticized Siebenkotten.
(lma/AFP)