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Housing shortage – tenants' association demands: "We need a rent freeze"

2023-12-07T14:27:20.712Z

Highlights: Housing shortage – tenants' association demands: "We need a rent freeze" In September 2023, German housing builders received 8,200 fewer building permits than in the same month last year. Single-, two-family and multi-family houses were particularly affected. In many districts of Germany's largest cities, the monthly cold rent eats up more than a third of the average income. The German government, on the other hand, presented a new package of measures in September to remedy the predicament in the real estate sector.



Status: 07.12.2023, 15:17 PM

By: Lars-Eric Nievelstein

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The situation on the housing market continues to deteriorate. The German government is providing new impetus to make housing affordable. However, these are not enough, according to the Tenants' Association.

Berlin – "Millions of people are overburdened by high rent and housing costs," says Stefan Körzell, board member of the German Trade Union Confederation (DGB), summarizing the fundamental problem. Together with the German Tenants' Association, the DGB took stock of the Federal Government's commitment to housing policy in Berlin on Wednesday. The verdict: inadequate. Central projects of the coalition agreement have not been implemented even two years after the formation of the government, the tenants' association announced. In times of rising rents, "unaffordable real estate prices" and little prospect of a silver lining, this is fatal.

Lukas Siebenkotten, President of the German Tenants' Association, explains in Berlin: "The situation on the housing market has deteriorated further in the last two years." Millions of Germans are overburdened with their housing costs. Although the government has laid down measures in the coalition agreement that may bring about an improvement, these are not being implemented and are not sufficient to cope with the crisis.

Siebenkotten: "The spiral of rents has gained significant momentum"

In many districts of Germany's largest cities, the monthly cold rent eats up more than a third of the average income. (Symbolic image) © Michael Gstettenbauer/Imago

Current figures from the Federal Statistical Office show how the housing crisis presents itself. According to these surveys, German citizens are significantly overburdened on average in the EU. In 11, 8.2022 percent of the population lived in households that spent more than 40 percent of their disposable income on housing. This puts Germany in fifth place in the EU. By way of comparison, the figure for our neighbours France is 6.5 per cent, and for Austria it is 7.4 per cent. "The spiral in rents has gained significant momentum," says Siebenkotten. A change in this development is not in sight.

In many districts of Germany's largest cities, the monthly cold rent also eats up more than a third of the average income. Berlin, Munich and Stuttgart are particularly affected.

In view of the steadily decreasing number of building permits within Germany, this is no wonder. In September 2023, German housing builders received 8,200 fewer building permits than in the same month last year. This corresponds to a decline of 29.7 percent. A similar picture emerges when looking at the long term between January and September. Single-, two-family and multi-family houses were particularly affected. According to the Wiesbaden authority, the main reasons for this decline were high construction costs and poor financing conditions.

Traffic light: "Significant boost" for the construction of affordable housing

The German government, on the other hand, presented a new package of measures in September to remedy the predicament in the real estate sector. Tax incentives for investment under the Growth Opportunities Act and a "record subsidy" for social housing are intended to give "a significant boost" to the construction of affordable housing. "In view of the dramatic slump in building permits and the associated decline in construction investment this year, the construction and real estate industry urgently need new investment incentives," said Federal Building Minister Klara Geywitz (SPD).

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This is not enough for the tenants' association. "The housing crisis is a socio-political scandal that is increasingly becoming a problem for companies as well," explains Körzell. They are able to fill fewer and fewer positions because there are fewer affordable apartments for new employees locally. "The federal government has obviously still not recognized the scope of the housing crisis."

Demand for solutions to the rental and real estate crisis

Without "courageous solutions", this crisis cannot be overcome, complains DGB board member Stefan Körzell. There is a need for massive public investment in social housing and an "energy-efficient renovation". He also puts the reform of the debt brake up for debate. And last but not least, the Tenants' Association is calling for a rent freeze in existing buildings. If the federal government does not take the necessary steps, "massive social upheavals" are imminent.

Sources: Destatis, Tenants' Association, Federal Government

Source: merkur

All news articles on 2023-12-07

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