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RENTING

Rents in Germany predicted to rise ‘much more than wages’

Tenants in Germany are facing tough years ahead, according to the German Tenants Association on Tuesday.

Residential buildings in the
Residential buildings in the "Mitte Altona" residential quarter in Hamburg. Photo: picture alliance/dpa | Christian Charisius

Speaking to the newspapers of the Funke Mediengruppe, the president of the German Tenants Association, Lukas Siebenkotten, said that he expects rents in Germany to continue to rise significantly and the number of overburdened households to increase over the next few years. 

If the current trend in rising rents continues, he said that the number of households spending 40 percent or more of their income on rent will “drastically” increase to over five million in the coming years, he said.

He anticipates that the average gross ‘cold’ rent (without ancillary costs) per square metre in existing properties will reach €10 in the near future. According to the most recent available statistics, the average was €8.70 per square metre in 2022.

READ ALSO: Why Germany is seeing the ‘worst housing shortage in 20 years’

Siebenkotten also warned that all possible legal means will be exploited by landlords in the coming years to increase rents, and predicted that rents will rise “much more than wages”.

Government widely misses housing construction target

Figures from the Federal Statistical Office show that the coalition government is far from achieving its housing construction target to build 400,000 new homes annually. 

Although more homes were completed last year despite rising interest and material costs compared to 2021, only 295,300 homes were built in total, an increase of just 0.6 percent or 1,900 more than the previous year, according to the Federal Statistical Office.

READ ALSO: EXPLAINED: How rents are changing in Germany’s five biggest cities

Siebenkotten said that the lack of new homes being built is affecting those who need them most urgently.

He warned of “social upheaval” and accused the government of not yet recognising the “social explosives” in this growing problem. He called for more financial support to keep housing affordable and for private investors to be encouraged to invest in social housing.

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READ ALSO: Germany’s rent brake to be extended – What you need to know 

 

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