The leading association for German housing industry is sounding the alarm, warning that Germany is on track for another record low in construction this year. Speaking to the magazine “Focus” GdW President Axel Gedaschko declared that “Germany is experiencing a historical housing crisis”. He noted that factors such as the war in Iran, rising construction costs, inflation, interest rates, and political disagreements threatened to halt any potential recovery before it could even begin. According to GdW figures, only 206,000 new apartments were completed last year-a figure that was already a record low. Gedaschko fears that this year’s numbers could fall “below the 200,000 mark” despite the fact that nearly all additional costs in social housing have been subsidized so far. He cautioned that this arrangement “cannot last forever for the taxpayer”.
Gedaschko also assigned some responsibility to the government for failing to reduce costs. “We are moving through a horrible jungle of bureaucracy” he told “Focus”. He explained that this is not just due to the requirement to meet every costly DIN standard, but also because constantly new, expensive requirements are being invented. He advocated for a new, affordable, and legally sound basic standard to counteract this complexity-a standard that could also be beneficial to tenancy law. He criticized the two ministries, run by the SPD (Building and Justice), for wanting something drastically different: a regulation that must be individually negotiated in every contract. He argued this would only make things more expensive and is “not the German speed we urgently need”.
The association president, whose member companies manage approximately six million residential units nationwide, concluded that if they could finally implement the simpler building type E using a basic standard, construction costs could be reduced by 15 percent. He added that this efficiency would allow them to build at least ten percent more subsidized housing for the same amount of money, though he lamented that “no one in Berlin seems to listen”. Regarding the outlook for the current year, Gedaschko forecasted that, in the medium term, the severe situations of tenants will not improve. The market will remain dominated by shortages, builders must expect further rising costs, and consequently, fewer homes will be built than before.
