Overview

• Germany faces a critical housing shortage, with over 550,000 homes missing and 9.6 million people living in overcrowded conditions.
• The new government coalition aims to accelerate construction with simplified building standards and modular methods under the 'Wohnungsbau-Turbo' initiative.
• Industry representatives suggest cost-cutting measures, such as thinner walls and reduced parking requirements, could lower construction costs by up to one third.
• Construction costs continue to rise, with new housing prices up 3.2% year-over-year as of February 2025, driven by material, energy, and financing pressures.
• Critics caution that the proposed measures lack clear guidelines for affordability and social housing, risking speculative development rather than addressing the housing crisis.