[jebentier]

Have to agree with the majority of commenters here. I’m an American expat in Berlin for 2 years now and the housing market is completely broken. Not only are prices continuing to go up, but the governments are blocking building to meet demand for affordable housing and renovations of older housing. If a person is able to buy something that is affordable in a major city, it is guaranteed to need an equal amount invested in renovations. In general the German population doesn’t care about owning property (last I saw only 40% of the country had actual interest in home ownership) and so this puts the market in the hands of the landlords entirely.

Germany is currently trying to combat against conglomerates coming in and buying out buildings to own outright and rent out, setting their own price for the rent. This kind of renting is becoming more and more widespread which is also contributing to the ever rising prices for rental housing.

[Joeri]

Sounds like they’re fighting the symptoms instead of the cause.

You can’t pump billions in subsidies into the market, lower interest rates to the floor to prevent that money from going around capital markets and not expect some kind of dysfunctional price rise in the real estate market. Money finds its way to where it provides the best return, and right now that is real estate in most markets. Trying to fight this tide at the real estate end is somewhat futile. The governments need to give the money a better place to go.

[nwah1]

Right. The correct approach is to tax land by value, but exempt improvements. Make it expensive to do idle speculation and cheap to renovate or build.

[hulitu]

> In general the German population doesn’t care about owning property (last I saw only 40% of the country had actual interest in home ownership) and so this puts the market in the hands of the landlords entirely.

In general, at least around big cities(100 km radius from München, for example), the "german" population does not afford a house. A new house is around 450000 euros and the land under it is also between 200 - 500 Euros per square meter. For a lot of people, especially migrants, this is undoable. If course if you go in forgotten places with no industry, no public transport and a lot of neo nazis you can find affordable housing.

[Arnt]

I too am an expat in Germany, and I come from a country where most people buy. I bought.

That only 40% of Germans have any interest in buying doesn't mean that 60% of Germans have no clue. It means that they have a system where buying isn't nearly mandatory. Rents are often only barely higher than the cost of capital for buying plus maintenance.

Both have grown, particularly in Berlin and some other places. (I live in Munich, which has had very high prices by German standards for a long time.) But that growth doesn't mean that the cost of renting is much higher than the cost of a bank loan plus maintenance etc. AFAICT, both have grown together.

[MisterTea]

> Germany is currently trying to combat against conglomerates coming in and buying out buildings to own outright and rent out, setting their own price for the rent.

Sounds like we're returning to good ol Feudalism.

[mariusor]

> it is guaranteed to need an equal amount invested in renovations

Unless you mean that as a hyperbole, I doubt it very much. Prices for flats, I believe, range from 400.000EUR up, and investing that much into renovations would bring you a marble, teak and gold leaf finishing house.