Half of big city households in Germany ‘spend over 30 percent of income on rent’

Half of big city households in Germany 'spend over 30 percent of income on rent'
Newly constructed housing in Frankfurt. Photo: dpa | Sebastian Gollnow
While the rental burden on households has dropped overall over the past two decades, people living in the major cities are still spending a big chunk of their income on rents - with the poorest among the hardest hit.

Almost half of the roughly 8.4 million households with a rental apartment in a major German city spend more than 30 percent of their net income on rent, according to a new study funded by the trade union-affiliated Hans Böckler Foundation.

Roughly a quarter of households have to spend at least 40 percent of their income on their Warmmiete (rent including heating costs) and ancillary costs, the study found, while just under 12 percent of metropolitan households spent more than half of their income on rent.

The findings were based on an analysis of the 2018 micro census carried out by researchers from Humboldt University Berlin.

Their analysis also showed that the financial burden of rents on tenants has declined in recent years due to the fact that, even among residents of major cities, incomes have risen faster than housing costs.

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Overall, tenants spent some 29.6 percent of their income on rent in 2018, down from 31.2 percent in 2001.

Increased construction activity has at best only slightly improved the housing shortage in recent years, the Böckler Foundation stressed, referring to the study.

There is a particular shortage of small and inexpensive apartments, the supply of which has dropped significantly in recent years, the foundation said.

The Federal Statistical Office (Destatis) has also concluded that rents now place slightly less burden on households overall in comparison with a few years ago.

According to its data, in 2019 just under 14 percent of the population (around 11.4 million people) lived in households that were financially overburdened by high housing costs. The overburden ratio has dropped somewhat since 2014.

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Destatis considers households to be overburdened if they spend more than 40 percent of their disposable income on housing costs – which includes both rents and mortgages. 

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