15/03/2016 Pons Real Estate

German Real Estate Market 2045: Residential Property will noticeable run short in Areas of High Population Density

Net migration facilitates property scarcity in urban areas and metropolises.

Pursuant to a new analysis, residential property will noticeable shorten in areas of high population density. In the long term, almost one million tenements could lack in ten major German cities and regions till 2030 thus housing prices would rise drastically. That’s the result of the study „Wohnen in Deutschland 2045“ (Live in Germany 2045) by the insurance company „Allianz“ together with the research and development company „Prognos“. Reason for this divergence is mainly the consistant net migration which primary focus on metropolises and urban reagions. This effect is additionally threngthened by increasing immigration from abroad. The study’s experts assume that Germany will, like Canada and Switzerland, increase in population in the coming years. So in 2045 there will likely live 85 million people in Germany.

Lacking tenements in the top ten regions

The Study identifies ten German regions where most tenements will be absent till 2030: Munic, Berlin, Rhine-Main-area, Stuttgart, Hamburg, Cologne, Münster, southern Upper-Rhine, Hannover and Düsseldorf. Even today, in most of these areas housing availability is scarce. Won’t these metropolitan areas raise their construction activity soon there will be a huge gab of 940.000 tenements in the next 15 years. «Housing availability is developing to slowly», project manager Tobias Koch mentions. Would the construction activity remain constant for the next 14 years there would be a lack of 173.000 tenements in Berlin.

Residential property scarcity

In addition, the ongoing trend to single-person households intensifies scarcity of residentional property. Whereas the number of German households increase by 14% in general till 2045 the number will rise by 18% just for the ten prior mentioned areas.

Structurally weak areas like Eastern Germany, North Hesse and Saarland have to face swelling difficulties: Inscrease both attractiveness of their region regarding quality of live and supply of workplaces. But what else can be done? Build and get more attractive, the authors recommend. From their perspective the real estate markets react to sluggish to shifts of demand. Particularly in the before mentioned areas where the demand for tenements stays high in the long term the construction activity must be enhanced rapidly.

For more information on investing in Germany: