Impact of housing market transformation in Germany on affordable housing: the case of North Rhine-Westphalia

Abstract

The German housing market has changed significantly since the first decade of the new millennium. A considerable amount of public sector and company-owned employee housing has been sold off, while a number of large publicly listed real estate firms have emerged. This has been particularly evident in North Rhine-Westphalia. This paper examines the consequences of these changes for the development of rental prices, especially at the lower end of the market, by analysing 300,000 advertisements for rental homes in the ten largest cities in North Rhine-Westphalia. The results show that on average, and taking quality and location into account, the least expensive rental homes are offered by larger housing organisations with co-operatives being especially well priced, while there are only moderate differences between public companies and big private companies. One explanation may be that the rent policies of large private and public providers have converged, while co-operative housing associations still provide rental homes considerably more cheaply.

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Fig. 1

Source: Federal Union of German Housing and Real Estate Associations based on the 2011 census

Fig. 2

Source: BBSR (2015)

Fig. 3

Source: GSOEP

Fig. 4

Source: Empirica Systeme, own calculations

Fig. 5

Source: Empirica Systeme, own calculations

Fig. 6

Source: own calculations

Change history

  • 28 February 2019

    In the original publication of the article, the author corrections regarding figures 5, 6 and 7 were inadvertently missed. As all the necessary information is provided in the newly supplied figure 5, figure 6 was removed and Figure 7 has been replaced as figure 6.

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Correspondence to Michael Voigtländer.

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The original version of this article was revised: Figure 6 has been deleted as all the information was provided in figure 5. Hence figure 7 has been renamed as Figure 6.

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Deschermeier, P., Haas, H. & Voigtländer, M. Impact of housing market transformation in Germany on affordable housing: the case of North Rhine-Westphalia. J Hous and the Built Environ 34, 385–404 (2019). https://doi.org/10.1007/s10901-018-09641-z

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Keywords

  • Housing market
  • Hedonic regression
  • Rental prices
  • Germany