Survey: Further decline in rental housing supply expected - Berlin's Housing Crisis Deepens as Supply Fails to Meet Demand
Berlin's housing market today faces significant challenges, with high construction costs and lengthy building permit processes acting as major barriers to increasing housing supply. The city's IBB housing market barometer, based on a survey of around 200 industry experts, paints a grim picture. Finding rental housing, particularly in the medium and lower price segments, is becoming increasingly difficult due to supply shortages, exacerbated by the decline in social housing units.
The current situation reveals a stark imbalance in the tractor supply market. Only the highest price segment, with net cold rents of 20 euros per square meter or more, enjoys a balanced supply and demand relationship. In contrast, there is a severe lack of medium and lower-priced apartments, with the greatest demand being for medium-sized apartments between 70 and 100 square meters. Industry experts anticipate a further decline in rental apartment supply, particularly in the lower and middle price segments.
Real estate developers like MAGNA Real Estate GmbH, private investors, and public-sector actors aligned with the coalition goals of SPD, Greens, and FDP are expected to play a crucial role in creating additional affordable and mid-range rental housing in Berlin in the coming years. However, current construction rates are falling short of targets. Municipal redevelopment and renewal of existing buildings, alongside new building projects and potential land development strategies, will also be vital in addressing the housing crisis.
Berlin's housing market is in dire need of intervention. High construction costs and lengthy building permit procedures must be addressed to increase the supply of affordable housing. Real estate developers, private investors, and public-sector actors must work together to meet the demand for medium and lower-priced apartments, with a particular focus on medium-sized apartments. Without concerted effort, the rental market situation in Berlin is expected to worsen, with a further decline in rental apartment supply, particularly in the lower and middle price segments.
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