Experts from the real estate industry sound the alarm: there will be a shortage of over 600,000 apartments

The main reason for this development is the rise in interest rates since spring 2022. According to Harald Simons, one of the real estate experts, this has made practically all residential construction projects uneconomical almost overnight, which has led to a virtual standstill in residential construction. The expert described the situation as a deep crisis in residential construction. According to the German Property Federation (ZIA), a 'black zero' for new residential developments would only be achieved with an average rent of EUR 21 per square meter, which is not realistic according to ZIA President Mattner. He emphasized that those who build anyway are facing bankruptcy.

Source: Spiegel online

Certainly, higher interest rates and construction costs are reasons for the crisis in the construction industry, as is the purchasing behaviour of property developers and project developers in the 'good times', who have opted for ever more. In my opinion, however, politicians are just as much to blame for the misery, having massively damaged an entire sector of the economy for years with their bureaucratic overregulation. But after the experiences in almost all sectors, whether education, transport, industry or defense, it was ultimately only a matter of time before the construction industry was also hit.

Although the shortage will certainly ultimately have a positive effect for landlords through higher rents, the social question of affordable housing naturally arises on the other side. However, this housing crisis will definitely not be socially acceptable.