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Planning minister: Build 250,000 homes a year

Planning Minister Barbara Hendricks on Thursday called for Germany to build 250,000 new homes a year to cope with housing shortages in its major cities.

Planning minister: Build 250,000 homes a year
Building land for sale in Schleswig-Holstein. Photo: DPA

The housing need in cities and university towns has increased dramatically, she said at the launch of an association for affordable housing in Berlin.

“There is a significant internal migration in Germany,” the centre-left Social Democrat (SPD) politician said.

While in some areas of the country population decline has left people struggling to sell their homes, the major cities are booming. The populations of Munich, Frankfurt, Berlin and Hamburg are all rising.

In Germany’s seven largest cities, the population has increased by a total of 330,000 since 2007 and the number of households has grown by 180,000.

In 2013, 225,000 new homes were built in the country.

One way to tackle the shortage is to make more wasteland available for building, Hendricks said.

The German Tenants’ Association wants to see one million new homes built by 2017, including 250,000 for social housing.

At the moment the government gives Germany’s 16 states €518 million a year for social housing, but the construction of affordable homes declined by 40 percent between 2002 and 2012, according to the Federal Office for Building and Planning.

Rents meanwhile increased 3.5 percent nationwide in 2013 to an average of €6.80 per square metre. They climbed faster in Munich, Berlin and Hamburg.

The government plans to cap rents in some expensive areas of cities to stop low and middle income earners being driven out. This has led to criticism from developers.

Hendricks said, however, that the planned cap on rents would not stall building as it did not apply to new homes.

SEE ALSO: Is rent in Germany too expensive?

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PROPERTY

Why Germany is mulling an extension to property tax deadline

Federal Finance Minister Christian Lindner (FDP) is seeking talks with state leaders to arrange a possible extension to the deadline for submitting the new property tax declaration. Here's what's going on.

Why Germany is mulling an extension to property tax deadline

Under plans to reform how property tax is calculated, around 36 million homeowners in Germany have been asked to fill in a tax declaration this year. 

The deadline for submitting the new declaration is currently set to expire at the end of October. But according to Finance Minister Lindner, just a quarter to a third of property owners have completed their tax return so far. 

Speaking on the RTL/ntv programme Frühstart, the FDP politician said he would arrange talks with the state premiers this week in order to pitch a deadline extension of at least a few months. 

“My offer: we extend the deadline for submitting the property tax return by a manageable period of time,” he said.

Lindner said it was important to be “realistic” about the fact that some citizens, especially older property owners and pensioners, felt overwhelmed with the tax return. 

He also acknowledged that there had been problems with the software for submitting tax returns, which had added to homeowners’ woes. 

Reform has faced numerous hurdles

The new system will primarily calculate the tax rate using land value and rent, though states will be able to introduce other regulations.

Advocates of the change say the new system is fairer than the current one that bases the tax rate on the (often outdated) value of the property. 

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However, attempts to carry out the largest tax reform since the Second World War have hit numerous hurdles along the way, with property owners complaining of difficulties filling in and submitting the declaration.

There were also issues affecting the government’s Elster tax portal, which was overloaded with users in July after the tax offices started accepting property tax declarations. 

The problems have led to growing calls to extend the deadline until at least January 31st, 2023. 

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