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Vacant apartment
Vacant apartment
New research published by property brokers CBRE and carried out by market research group empirica throws useful new light on the level of vacancies in residential apartments across Germany, and highlights the extent to which regional differences between the eastern and western parts of the country are still very pronounced.
Source data for the study comes from CBRE’s own economic data on 600,000 residential units, combined with analysis and estimates from empirica’s regional databases and government statistics.
The study is the first new definitive analysis of the vacancy situation in German residential for several years, with perhaps the usefulness of any traditional message it may have had being drowned out in the rush to invest in German residential property over the past four years
Not surprisingly, given the heightened level of demand for living space particularly in the larger German cities, the overall level of vacancy in the nations’s apartments was 3.4% at end-2011, the fifth successive annual fall. (Projected figures for 2012 are 3.2%). Of the 114 cities included in the study, the cities with the lowest rate of unoccupied apartments are Munich (0.6%), Hamburg (0.7%) and automobile maker Audi’s home city of Ingolstadt (0.8%).
The so-called ‘market-relevant’ level of apartment vacancies i.e. those immediately or very shortly available for renting, was 3.4% nationwide at the end of 2011, representing about 720,000 available units. That is a decrease on the 52,000 available at end-2009 (770,000 units), while 119,000 new apartments were built in the intervening years.
If you include vacant apartments not really suitable for renting, that would bring the total up to 1.6 million apartments vacant (plus a further 1.5m self-contained apartments in family homes).
The market-relevant vacancy rate of 6.5% in eastern Germany (excluding Berlin) is much higher than the average rate in the west of 2.7%. Cities with the highest vacancy rates overall are Salzgitter (11.7%), Chemnitz (10.4%) and Schwerin (9.9%).
Further statistics released by the 143-member Association of Berlin-Brandenburg Housing Association (BBU) highlight the dramatic shrinking of the traditional Berlin vacancy rate to 2.3% at end-2012. For most inner-city neighbourhoods, the vacancy rate is now under 1.5%, or non-existent for all practical purposes.
Empirica CEO Reiner Braun had some interesting comments to make at the presentation of the figures in Berlin recently. “It would be wrong to talk about a general housing crisis in Germany”, he said, referring instead to ‘bottlenecks’ in about 20 cities. The main reason for the reduction in vacancy levels is the trend for smaller households and internal migration, particularly into the metropolitan areas where the new jobs are. Freeing up so-called ‘reserve vacancy’ would only partly solve the problem, he said.
Recent figures released by the Association of German Pfandbrief-issuing Banks (VdP) show the prices for owner-occupied housing in German having risen by 3.4% in this year’s first quarter year-on-year, with particularly the prices for apartments (condominiums) jumping by 5.7%. Dual-family housing rose 2.5%, while the prices for multi-family houses rose 3.7% - all largely rising because of the ability of tenants to push through sizeable rent increases across the market. Rent increases on new leases averaged 4.3%.
