Germany’s first-time buyers above average in age and income
The typical first-time buyer in Germany is 48 years of age (average age of the population as a whole: 44), has a net income of EUR 1,932/month (population as a whole: EUR 1,906) and, in most cases, is childless (69% of first-time buyers have no children, compared to the national average of 52%).
The figures, according to the Handelsblatt, suggest there are now 2.27 million would-be buyers in Germany, compared to 1.99 million in 2015. In a survey of aspiring buyers, 56% said that they want to own their own home as a retirement investment, while for 41% not paying rent is a major motivation, and 37% want to take advantage of historically low interest rates.
According to the Federal Office of Statistics, 16% of the German population lived in households that spent more than 40% of their disposable incomes on housing in 2016. This is the level at which households are classed as being ‘overburdened’ by housing costs. The Suddeutsche Zeitung revealed that the housing cost burden has remained constant over the last few years, except in 2014, when it was 17% higher. Overall, German households spend 24% of their incomes on housing.
The data comes amid the release of a study by ING Bank published in the Frankfurter Allgemeine Zeitung and the Suddeutsche Zeitung showing that rapid house price growth has forced many Europeans to abandon their dream of owning a home. This is especially true in the UK and Germany, where 56% of non-homeowners assume they will never fulfil homeownership dreams.
Meanwhile, the Suddeutsche Zeitung published TAG Immobilien’s ‘Housing Market Report 2017’, which has registered population growth and tumbling vacancy rates in many eastern German cities, even in smaller and lowerprofile communities such as Eisenach, Gorlitz and Merseburg. At the same time, these positive developments are entirely bypassing some municipalities and communities.
A second study, from the Ifo Institute in Dresden, has found that there are now 600,000 vacant apartments in eastern Germany – a number that is set to double to between 1.1 million and 1.2 million by 2030. Over the same period, the region’s vacancy rate will rise from 9% to 14%.
Although the headline findings may appear contradictory at first glance, both studies agree that, while the population of eastern Germany is expected to decline dramatically over the next two decades, the populations of the region’s largest cities are set to grow, significantly boosting the communities around these cities.
According to TAG, rental prices in 24 of the 27 surveyed cities have risen substantially since 2012. The strongest increases were registered in Berlin (33.4%), followed by Leipzig (25%).
A further ten cities in eastern Germany have registered double-digit rental price growth over the last five years. In some cases, house and condominium prices have also been enjoying significant growth, especially in the areas around larger cities.