The Vonovia boss paints the devil on the wall: he expects no less than a “giant problem tidal wave” when billing the ancillary costs for 2022 in the coming year.
Germany’s largest housing group, Vonovia, expects many tenants to have significant problems with ancillary costs in 2023 due to the sharp rise in energy prices.
Vonovia CEO Rolf Buch said he was “extremely worried” about the accounts for 2022, which are due in 2023, when he presented the 2021 annual balance sheet. “We now have to make everyone aware that a huge tidal wave of problems is coming our way.”
Political support required
Until then, you have to deal with how to deal with it in concrete terms. “How can we help with deferrals and installment payments in 23, for example?” Buch continued. However, he believes that this cannot be done by tenants and landlords alone. “Instead, there is a need for intensive political support again, not just for a small group, but probably for a very large group of people.”
Vonovia is Germany’s largest housing group. The listed company rents out more than 565,000 apartments in Germany, Sweden and Austria, including more than 505,000 in this country alone. In Germany, almost half of the population lived in rented accommodation in 2020.
Price increases are not acceptable for many
“Around two-thirds of the apartments we have are heated with gas,” continued Buch. For Vonovia as a landlord, the heating costs are a pass-through item, but their share of the ancillary cost bill is 30 percent. Among the Vonovia tenants are families, seniors, single parents and young professionals, “who often have little financial leeway”. Therefore, it is the landlord’s job to point out the problem. The tenants were strongly recommended to adjust the monthly advance payments. “But I’m still convinced that the price increases will not be sustainable for many households without further government support,” he said.
After growth in sales and operating profit in 2021, Vonovia intends to grow significantly again in the current year. In addition to higher rental income, the takeover of the industry rival Deutsche Wohnen, which was completed last year, should contribute to this. Sales and operating profit are expected to grow by more than 20 percent, said Buch.
Vonovia with a profit of over 2 billion euros
According to the Dax company, the operating result should increase to between 2.0 and 2.1 billion euros in 2022. Sales are expected to increase to between EUR 6.2 and 6.4 billion. Last year, operating profit rose 24 percent year-on-year to €1.67 billion. Revenue climbed by around 19 percent to almost 5.2 billion euros.
The average rent increased to 7.33 euros per square meter – that was 2.4 percent more than a year earlier. Modernized apartments in particular contributed to the growth. The companies can partially pass on the costs for energy-related renovations such as thermal insulation and the replacement of old heating systems and windows to the rent. The dividend is to be EUR 1.66 per share.
The German Tenants’ Association was critical of the business figures. “The tenants continue to pay the immense profits and dividends,” said the chairman of the German Tenants’ Association of North Rhine-Westphalia, Hans-Jochem Witzke, according to a statement. It cannot be that the shareholders of the housing group are guaranteed a dividend while tenants are struggling with rents that are becoming less and less affordable.
Source: Stern
Jane Stock is a technology author, who has written for 24 Hours World. She writes about the latest in technology news and trends, and is always on the lookout for new and innovative ways to improve his audience’s experience.
