Social housing in Germany: Historical low shocks housing market!

Social housing in Germany: Historical low shocks housing market!

The number of social housing units in Germany continues to fall worryingly. At the end of 2024, the inventory is estimated to only amount to around 1.05 million publicly subsidized apartments, which corresponds to a decrease of around 26,000 units compared to the previous year. In 2023, Germany still had around 1.07 million social housing units. This level is alarmingly low and represents the historic low recorded in the history of unified Germany. For comparison: ten years ago there were around 1.5 million, and in the early 1990s the number was around three million. This data was published in a response from the federal government to a request from the Left, which brings the issue significantly into focus.

Left-wing Bundestag member Caren Lay commented on the alarming figures and described the decline as a new historic low. She criticizes the fact that the traffic light government, which had set itself the goal of creating 100,000 new social housing units every year, is unable to stop the negative trend. Lay also calls for at least 20 billion euros to be made available annually for social and non-profit housing in order to improve the situation.

Criticism of politics

Lay said that the announced lighter budget increase for social housing was viewed as insufficient. While around 62,000 apartments were funded by the federal government last year, the funds from the states are also highlighted. However, social housing falls out of commitment after a certain period of time, leading to a further decline in the overall stock. This development dynamic calls into question the plans of the new Construction Minister Verena Hubertz (SPD), who is planning to extend the rent cap by four years.

Hubertz also announced a so-called “housing construction turbo” and described social housing as an important pillar for affordable housing. For 2024, 3.5 billion euros are earmarked for social housing construction. Despite these announcements, however, there is criticism of the planned support for private housing construction without rent caps, which could exacerbate the already tense market situation.

Situation on the housing market

The social housing is offered at cheaper prices than on the open market. Providers can be private investors, municipal housing companies or cooperatives. Anyone interested must apply for a residence permit (WBS). The largest share of social housing is in North Rhine-Westphalia, followed by Bavaria and Berlin. If current trends continue, it will become increasingly difficult to find affordable housing, particularly affecting low-income households.

Overall, it appears that the decline in social housing is reaching alarming proportions, and the measures taken so far do not appear to be sufficient to sustainably improve the situation. Politicians now have a duty to develop effective solutions to reverse this worrying trend.

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