Rental Costs Rise to New Heights
In the last 6 months, rental costs have risen by 4.5% according to the IDV Institute for Real Estate Market Research; Munich thus remains officially the priciest place to live in Germany with Hamburg and Berlin following closely at its heels. Regardless of whether it is an old or new build, a semi-detached or terraced housing, IDV Director Stephen Kippes claims that these rising costs have not yet '...reached a plateau...' and are subsequently expected to continue increasing.
According to the Münchner Merkur, the reasons for rental price increases are varied. Arguably, the main culprit is the recent boom in population, and unfortunately it will keep on climbing upwards. Munich's population is expected to have increased by over 10 per cent by the time 2030 comes around.
Another reason for the skyrocketing rental rates for Munich residents is the dearth of real estate that is actually available. According to IVD, there is a lack of around 31,000 flats or apartments as the city is failing to achieve its goal of building 7,000 new homes per year.
Finally, there are also indications that more and more senior citizens are living alone. This increases the demand for living space across the city even more. In addition to this, the overall quality of living has risen, as people expect to get more living space for their money. How can this increase in rental costs be curtailed? Kippes urges the city to issue more building permits and is of the opinion that the city should think about compacting itself and using development gaps to their advantage. Loft conversions would also be a good solution, utilizing the space that is already there and available to the city of Munich.