Social Housing Alliance presented the results of its recent study with the alarming conclusion that there is currently a shortage of 700,000 homes in Germany.
On entering office, the federal government, a coalition of the Social Democratic Party (SPD) Greens and the neo-liberal Free Democratic Party (FDP), pledged to build 100,000 new homes per year. In fact, only 20,000 social housing units (i.e., housing for less well-off members of society) have been completed.
The study was prepared by the Pestel Institute in Hanover and (ARGE) in Kiel (Working group for contemporary building in Kiel). It was commissioned by the Berlin-based Social Housing Alliance, which includes the trade union IG BAU and the tenants’ association, as well as a Caritas social welfare association and two building associations active in housing construction.
The study finds a record shortage of affordable housing and especially of social housing. In its first year in government, the coalition of the SPD, Greens and FDP only managed to complete 250,000 to 280,000 new flats instead of the 400,000 planned.
In addition, the situation is likely to worsen. Many social flats are coming to the end of their contract period, and too few new ones are being built. On the other hand, the population increased from 80.5 million in 2011 to around 84.5 million in 2022. While births in 2022 fell to their lowest level since 2014, and the death surplus reached a record high (not least due to the pandemic), net immigration rose to a peak of 1.5 million, largely due to the intake of refugees from Ukraine.
As it turns out, the stock of social housing is actually in decline. During the 1990s there were about 3 million social housing units in Germany; there are only 1.1 million. The report is based on figures from the social association VdK, according to which there is currently a need for 5 million social housing units. VdK President Verena Bentele points out that not only people who have been living in poverty or on low wages for a long time are dependent on social housing, but also a large number of families who were relatively well off a few years ago, but who are now in financial difficulties due to huge rent increases and the explosion of energy costs.
The Building and Housing in Crisis report shows that building projects, whether subsidised or not, are generally becoming more and more expensive. This is due to a number of factors: A large increase in the price of building materials as a result of disrupted supply chains since the coronavirus, rising inflation and the explosion of energy prices associated with the anti-Russian sanctions, and increased interest rates on bank loans. In the past, investors in state-subsidised construction projects were still able to earn a return on their investment, even with basic rents of €6 per square metre. But any such returns are eaten up by extra costs. For this reason, many cities only continue work on current construction sites, but hardly plan any new projects.
Excessive rents in the large cities are already driving more and more people into hardship. More than 11 million tenant households in Germany are entitled to a housing entitlement certificate (WBS), and thus to social housing. However, social housing is only available for one in 10 of those entitled. As the report shows, there are only 1.1 million social housing units left in Germany.