Creaking housing situation in Munich

A new report by the by the Department of Urban Planning and Building Regulations, highlights the state of the population density of Munich.Around 1.6 million people in 852,000 households currently live in the city.

As in previous years, the situation on the real estate and housing market is tense, as demand significantly exceeds the supply of housing. This is then reflected in rising rents and purchase prices, which are often seen as exploitative. 75 percent of people in Munich rent their main living accommodation In the 2028/19 reporting period, with around 1.6 million people living in 852,000 households.

Only one person lives in more than half of the households (55%). On average, 1.9 people live in a Munich household. The average living space in Munich is 39 square meters per person (while the national average is 47 square meters). The city of Munich responds to the housing shortage with the housing policy action program "Living in Munich VI (2027 to 2021)" which has funding of about 870 million euros.

In 2019, 7,000 new apartments were completed In 2019, building rights were created for 3,500 apartments and building permits were issued for 11,000 residential units. In addition, 7,000 apartments were completed in the same year, about one in four of them in subsidized housing.

In other related news, rent increases for a building in Schwabing are reaching the Federal Court of Justice. The Munich Tenants' Association aims to set an example and fight back against landlord greed.

The owner of the residential complex called Hohenzollernkarree in Schwabing had justified the drastic rent increase for more than 130 tenants with modernisation work, which was announced shortly before the end of 2018, but was to be implemented only two years later. Other such businesses use similar means to force up the rents. However, since 2019, a new law applies, according to which only a smaller portion of the modernisation costs may be passed on to tenants. According to the tenants' association, the real estate company was concerned with "just being able to grab old law".

The span between the announcement of the modernization and the actual implementation was too long, said the presiding judge in October 2019. Against this decision, the real estate company appealed.

According to the tenants' association, the question of whether new or old law is applied makes a big difference: "An affected couple would have had to pay 729 euros more in rent per month under old law. Under the new law, the rent increases by a maximum of about 230 euros a month," the association said.

The possibility of this type of legal action has only existed in Germany since November 2018. Since then, an association can go to court on behalf of consumers against a company. The consumer lawsuit is intended to make it easier for them to obtain compensation for damages. The risk is assumed by the association bringing the action.

"We are very confident that the Federal Court of Justice will also decide in the interests of tenants," said Tenants' Association Managing Director Volker Rastätter. "If the decision is positive once again, the rent increases may be significantly lower than the owner-GmbH would like."

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