The real estate industry in Germany is facing various challenges, with many homebuyers struggling to afford the high cost of living due to regulations such as the KIM regulation. Gollenz, the head of the trade association, emphasizes that his members do not require state subsidies but rather a supportive legal framework that does not impede their work.
According to Gollenz, two-thirds of new housing construction and renovations are carried out by the association’s members. However, increased interest rates, stricter regulations on loans and debt repayments, and rising prices have significantly decreased demand for new construction. To address this issue, Gollenz calls for framework conditions that reduce the cost of living by streamlining excessive regulations such as fire safety requirements and parking space mandates.
Another challenge facing potential homebuyers is the debt repayment rate restricted to 40% of household income according to the KIM regulation. Gollenz hopes for a relaxation of this regulation since in Germany, the debt repayment rate allowed is 60% of household income. The real estate industry has been presenting housing construction concepts for years that seem to be overlooked by politicians, prompting Gollenz to call for increased pressure on policymakers.
Real estate agents are also facing challenges due to the ordering principle where the paying party also hires the agent. Pisecky calls for an immediate withdrawal of this principle for rental contracts, which previously required tenants to pay agent commissions before July 2023. The industry hopes that changes will be considered in the next legislative period by politicians.
In conclusion, while there are subsidized municipal and non-profit housing projects in Germany, commercial housing represented by Gollenz is facing significant challenges due to regulatory barriers and decreasing demand for new construction. To address these issues