The housing companies of the Federal Association of German Housing and Real Estate Companies (GdW) invested around €19.4 billion in the construction of affordable housing and its management in 2020. This was around 13.5 percent more than in the previous year. But across the board, the outlook for the future is bleak: The rise in construction costs, rent regulations and other restrictions are preventing sufficient affordable housing from being built.
Looking at developments in the housing industry in recent years, it can be seen that the business climate has fallen by 3.3 index points since the economic and financial crisis in 2008/2009. Even though the GdW companies built around 4 percent more housing in 2020 than in 2019, a closer look at the overall situation and construction behavior in Germany reveals that there is a major shortage, particularly in the area of social housing.
Although 306,000 units were ultimately completed in 2020 out of a total of 320,000 needed, if we look at affordable public housing, the numbers look quite different. Of the 104,000 affordable housing units needed, only 85,000 units were completed in 2020, representing only 61 percent of the housing units actually needed. In the case of subsidized social housing, the figure was as low as 38 percent. In order to be able to build better and more again, the GdW is calling for, among other things, a stronger government commitment to building and maintaining social housing.
Source: GdW
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