Housing Quality : Germany

There are still great differences in quality between housing in the old and the new federal states and in the amount of living space available. In western Germany the average living space available for each individual is 37.9 square meters, twice as much as in 1950. In the east it is about 30.9 square meters. 98.3 percent of all dwellings in the western states have a bath, 81.7 percent have central heating, and 55 percent have central hot water supply. The housing stock in the west is on the whole much younger than housing in the new federal states, where about 51 percent of the dwellings were built before 1948. Despite numerous improvements, many dwellings in the new federal states are still in a poor state.

They frequently lack modern sanitary facilities, and the heating systems are outmoded. The regime in the former GDR kept rents artificially low. Efforts were concentrated on new construction, and existing housing stock was neglected. As a result, municipal and cooperative housing enterprises as well as private owners had hardly any funds for maintenance and modernization. Modernization and renovation of old buildings in eastern Germany must continue - even though significant improvements in terms of both quality and standards have been made in more than half of the entire eastern housing stock, thanks to federal financial assistance made available for this purpose. Between 1991 and 1997, the Federation furnished about DM 7 billion in financial assistance for social housing in the new federal states, funds which could also be used for modernization and renovation projects.

Many housing units owned by housing associations and housing cooperatives are gradually being privatized. Renters who buy their dwellings and private investors are receiving tax relief and grants for this purpose. New opportunities for investment are opening up in the housing sector in the new federal states now that some of the major obstacles such as the old debts of the housing sector have already been removed through an infusion of about DM 28.5 billion from the federal budget (from the fund for retirement of assumed debts) and through gradual upward adjustment of rents to realistic levels. But further efforts are required in the western part of the country as well, even though in light of the strapped state of public finances the high levels of financial support provided in past years can not longer be made available. Between 1991 and 1997, DM 14 billion in federal funding was made available for social housing projects in the western states. A number of important reforms - such as the Housing Code - are on the agenda for the future in order to safeguard and further improve the framework conditions for a well-functioning housing market.