Economist Matthias Wrede, Professor of Social Policy at the FAU Erlangen-Nürnberg, was interviewed by the F.A.Z. (Frankfurter Allgemeine Zeitung) about the housing shortage in Germany, its consequences for the labor market, and possible solutions.
Like many other wealthy countries, Germany is facing a shortage of affordable housing due to demographic change, increased demand from migration, the expiration of social housing subsidies, rising construction costs, and regulatory barriers. In addition, supply is limited by resistance from local residents to redensification and new construction.
The problem is particularly acute in cities and attractive regions and has economic and social consequences such as limited mobility, displacement and overcrowding. Current construction trends favor high-yield projects, meaning that affordable new housing is rarely being built without subsidies. Solutions include simplifying building regulations, promoting serial construction, expanding social housing, and speeding up planning processes. Read the interview (in German) here.