German building industry proposes affordable housing push

A broad alliance of major German housing-related associations, the Verbndebndnis Wohnungsbau (VBWB), presented a "German Plan for Affordable Housing" on Wednesday (10.9.2014) in Berlin.

"Having a place to live is a basic need," said Hartmut Goldboom, a representative of the German construction materials supply industry, speaking on behalf of the alliance. "It should be affordable."

The VBWB claimed that the monthly rent of a typical medium-quality new apartment in Germany's major cities could be reduced by as much as 40 percent compared to current prices, if the government adopted a set of policies making it cheaper to build new apartments.

That could represent a great benefit to millions of renters over coming years - if it turned out to be both accurate and achievable. Moreover, despite its focus on Germany, the twin reports underlying the VBWB report could prove thought-provoking for policymakers in other countries faced with housing affordability challenges.

Reducing the landlord's claim on renters' monthly income

One of the studies underpinning the report was produced by the Hanover-based Pestel Institute, which specializes in regional development and urban planning studies.

There's no shortage of luxury apartments being built, like these in Frankfurt

"In pre-unification West Germany, we had around four million social housing units. But a wave of privatization policies post-unification has led to a situation where there are only a million and a half in the whole of unified Germany today," said Pestel Institute director Matthias Gnther.

"There's a shortage of affordable housing in the bigger cities - not in most small towns, or in the countryside, but in big cities it's getting worse. We need another 250,000 to 300,000 new apartments in the cities - affordable ones, for low- and middle-income people."

The study's focus was on new build, not on renovations. The latter may make life better for residents, but they don't increase the building stock - or its affordability.

Go here to read the rest:
German building industry proposes affordable housing push