german house

Why don’t most Germans buy their homes

I was recently speaking with a friend of mine from Germany who told me that most Germans never actually buy a house but rent for life. This quite surprised me so I looked at the stats and it is true.

With an ownership rate of just 41% German people are almost the lowest in Europe (just Switzerland coming in a little lower at 38%).

Coming from Ireland where owning a home is almost a rite of passage this appeared quite strange.

Ownership rates in Ireland is almost double that of Germany at over 81%. So why the difference between these two developed countries in Europe?

Well it seems that renting in Germany is perhaps a much nicer affair than in other countries.

The housing policy in operation for many decades appears to have struck a nice balance between Government and private involvement meaning government intervention was at a minimum.

The opposite of this happened in some other European countries where governments imposed rent controls on Landlords effectively meaning they had less to spend on their housing.

The result was that the quality of housing in these countries suffered. Consequently the rental market got a reputation for bad quality housing.

Another factor is that renting is relatively cheap in Germany as compared to other countries. This is perhaps another off shoot of less government penalties on Landlords.

Also tax laws in Germany don’t favour the owning of property. For example interest paid on a mortgage in Germany is not tax deductible as it is in many other countries.

Overall Germans seem quite happy with their lot when it comes to housing situation. So, who said anyone needs to own a house after all. Unless I need permission to hang a picture on the wall??!

If you are searching to buy a house in Germany, here is a good place to start:

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