A study finds that Germans’ dream of owning their own home is crumbling. High interest rates and energy costs ensure that the detached single-family home becomes less attractive. And the thought of an unrenovated old building tends to give rise to nightmares.
The dream of having your own four walls does not seem realistic to many people in Germany at the moment. This is shown by the “Living Dream Study” by the real estate financier Interhyp, for which the Rheingold Institute surveyed 2,000 people in a representative online panel. Accordingly, 84 percent of those surveyed find the real estate market to be difficult and see few options. Only 25 percent see opportunities in the current situation.
According to the survey, this negative view is led to high real estate prices and increased building interest rates as well as a shortage of skilled workers, a low supply and uncertainty regarding legal regulations, especially around the heating law.
Unrenovated home not very attractive
The issue of energy also means that buying an old building seems like a nightmare to many people. Of the tenants surveyed who can basically imagine buying a property, 64 percent categorically rule out unrenovated existing properties. They fear the expense of modernization and insulation as well as incalculable and excessive energy costs.
The bottom line is that the ultimate dream home – the detached single-family home – loses its appeal. In the current survey, only 53 percent named this type of apartment or house as their favorite. In the previous study last year it was 64 percent. Although a detached home is still the biggest dream of living, people tend to dream smaller, says Interhyp board member Mirjam Mohr.
“We see a great deal of uncertainty and a certain rigidity on the one hand – and a great longing for a home of our own on the other,” says Mohr. 42 percent of those surveyed actually want a change in their living situation, but are currently coming to terms with it. Many people still harbor the dream of owning their own home: 70 percent of tenants want to live in their own home one day.
Historic collapse in the real estate market
The gloomy mood among potential property buyers fits in with current news from the construction and real estate industry. The housing giant Vonovia has stated that the construction of 60,000 apartments is currently on hold because it is no longer profitable due to increased construction and financing costs. The worsening conditions have also led to several project developers slipping into bankruptcy in recent weeks.
The real estate industry as a whole is struggling with a slump of historic proportions. The Hamburg Gewos Institute predicts that a quarter fewer residential properties will be sold this year than in 2022. After years of boom, these would be the lowest sales figures since the time series began in 1995.
Sources: Interhyp / DPA / Gewos
Source: Stern
