What does the decline in new construction mean for the housing market and how does this affect rental prices?

What does the decline in new construction mean for the housing market and how does this affect rental prices?

Because housing construction has almost come to a standstill, there is a concentration on existing rental apartments in the real estate market. This has already led to rising prices, but there are fears that parts of the population will soon no longer be able to afford housing. This emerges from a report in Die Welt.

The effects of this situation are clearly noticeable. As housing construction stagnates, there are fewer new apartments on the market. This leads to a limited supply and thus to rising rental prices. According to experts, prices will continue to rise as demand for housing continues unabated.

People with low incomes are particularly affected by this development. As rents rise, it becomes increasingly difficult for them to find affordable housing. This could lead to parts of the population no longer being able to afford a place to stay and ending up in precarious living situations.

There are also new opportunities for investors in the real estate market. The permanent increase in rental prices allows them to achieve attractive returns. However, there is a risk of a real estate bubble if prices continue to rise uncontrollably. It is therefore important to closely monitor developments on the real estate market and, if necessary, take regulatory action.

Overall, it is clear that the lack of housing construction will lead to a worsening of the situation on the real estate market in the long term. Rising rental prices and the lack of affordable housing represent major challenges for society. Urgent measures are needed to stimulate housing construction and create socially acceptable housing.

Source: According to a report by www.welt.de