Germany homeownership rate hits lowest level since 2005

The homeownership rate in Germany has dropped to a new low of 43 to 44 percent, according to analyses by the Pestel Institute. This represents the lowest level recorded since 2005, down from nearly 47 percent in 2018.

Economic conditions in the real estate market are cited as the primary cause for this decline. Matthias Günther, head of the Pestel Institute, noted that lower and middle-income earners, including dual-income households with average earnings, struggle to afford property. The organization Haus & Grund Deutschland echoed these concerns, stating that purchase prices and ancillary acquisition costs have risen significantly faster than citizen savings over several years.

Younger generations are particularly affected; currently, only one-third of people under the age of 35 in Germany live in owner-occupied homes. The gap between income and wealth growth compared to property price developments has created substantial barriers to accumulating the necessary equity for home purchases.