Flats are lacking in every nook and cranny

The figures are sobering: from January to November 2023, the number of building permits for flats fell by 28.8 per cent compared to the same period last year. At the same time, there is a shortage of 910,000 social housing units in Germany. These deficits are now having a clear impact on the housing market.

The latest housing market study by the Pestel Institute (Hanover) criticises government mismanagement of housing subsidies. The study accuses the federal and state governments of having massively neglected the promotion of social housing. This has resulted in a "dramatic shortage of social housing in Germany": According to the scientists' calculations, there is currently a nationwide shortage of more than 910,000 social housing units.

The Bavarian capital of Munich is the frontrunner when it comes to "turbo rents". Here, the rent paid by the job centres to cover the costs of accommodation was €19.20 per square metre, around €6.40 - exactly 50 per cent - above the average rent in Munich. The study shows that in particularly tight housing markets, where there is a lack of affordable alternatives, the state pays excessive and therefore significantly above-average rents when covering accommodation costs.

The German government now wants to respond to this. Federal Building Minister Klara Geywitz has announced: "A total of one billion euros is available for both 2024 and 2025. We only want to subsidise flats in the lower and middle price segments." That is at least a first step.

Generally speaking, significantly more flats need to be built in Germany to eliminate the current bottleneck. However, the latest figures from the Federal Statistical Office are sobering: from January to November 2023, a total of 196,700 flats were approved. This is 28.8 per cent or 79,700 flats less than in the same period last year. The number of building permits for single-family homes fell by more than a third (-38.6 per cent), while the number of approved flats for two-family homes almost halved (-49.2 per cent). The number of approved flats for multi-family houses also fell significantly by almost a quarter (-23.8 per cent).

(Photo: Andrea Ajale, Pixabay)