BERLIN, Aug. 20 (Xinhua) -- A large majority of Germans would rather live in their privately-owned home than a rented property, a study published on Monday by the magazine "SPIEGEL ONLINE" finds.
Around 84 percent of respondents indicated a preference for buying rather over renting in a survey conducted by the Civey opinion research institute for "SPIEGEL ONLINE".
The findings challenge Germany's traditional reputation as a nation of renters and could hence herald an ongoing shift away from a housing policy model which some economists view as one of the key tenets of its economic success.
According to the latest available Eurostat data for 2016, Germany was the European Union (EU) member state with the lowest share of citizens occupying a home which they owned (51.7 percent). The European average rate was measured at 69.3 percent. Notably, however, the three countries at the bottom of the table, Germany, Austria and Denmark, were also some of the wealthiest and least unequal of the bloc, while relatively impoverished Romania (96 percent) came first.
This circumstance has led scholars like the Harvard economist Edward Glaeser to highlight disadvantages of high home ownership rates for urban and national development. Low home ownership rates tend to result in citizens having more disposable income and liquid wealth which they can invest in assets with higher yields, as well as making them more mobile in response to economic crises. Additionally, home ownership is more likely to take the form of larger houses than compact flats for rent, putting more strain on the environment and scarce resources.
A potential reason why Germans may nonetheless be losing their long-standing appetite for renting was identified in the "SPIEGEL ONLINE" study in fast-rising rental costs witnessed during the past years. Renting became 4.3 percent more expensive on average in Germany in 2017, while prices in Berlin soared by nearly twice that rate at 8.4 percent. Rent control policies in particularly crowded urban rental markets have failed to halt this trend, leading justice minister Katarina Barley (SPD) to announce more aggressive legislative action to ensure the availability of affordable rented housing.
Yet while German renters may increasingly be dreaming of a house of their own, "SPIEGEL ONLINE" noted that this wish was unlikely to become reality in the overwhelming majority of cases. Low interest rates have led to a boom in demand for private properties and concurrent rises in property prices which dwarf the observed increases in renting costs. In Munich and Berlin, for example, the rate of increase was estimated by the Empirica research institute at a staggering 140 percent between 2009 and 2017.
"SPIEGEL ONLINE" wrote that market for private homes in high demand cities have "effectively been cleared." The respondents in the Civey survey were well aware of the unfavorable buying conditions at the moment with 70 percent indicating that real estate prices in densely-populated areas were overvalued and 45 percent reaching the same verdict for rural areas.
As a consequence, the share of respondents who said that they had concrete plans to purchase a property within the next years was far lower (16 percent) than those who merely said they would like to do so (84 percent).
The group of respondents aged between 30 and 39 years was hereby still most likely to climb the property ladder. Around a third thereof indicated that they "probably" or "certainly" buy a home within the next five years.
