Spending Patterns: Germans Dish Out Nearly a Quarter of Their Income on Housing Costs
Living Expenses in Germany: Over a Quarter of Spending Goes towards Housing - Germany's Residential Expenditures: Every fourth Euro is allocated towards housing costs.
Housing expenses are a significant chunk of income for many folks in Germany. In fact, they splash out a whopping 24.5% of their earnings on rent or other housing-related costs, such as homeownership. That's 5.3 percentage points more than the EU average, making Germany a premier player in high housing costs, as reported by the Federal Statistical Office (BSW) [1].
Last year's figures may have improved slightly compared to 2023, but Germany still ranks high in housing costs. Neighbors like France, Austria and the Netherlands, on the other hand, boast significantly lower housing expenses [1].
In 2024, higher housing cost shares were observed in Denmark (26.3%) and Greece (35.5%), with Sweden roughly equaling Germany. On the other hand, countries such as Cyprus (11.4%), Malta (12.5%), Italy, and Slovenia (each 13.6%) reported strikingly lower housing cost shares [1]. The EU average hovers around 19.2% [1].
BSW chairwoman Sahra Wagenknecht remarked, "Housing in Germany is practically a poverty program for a large portion of the population." She further stressed that nations like France and Austria spend significantly less on housing, indicating it's possible to do better [1]. Wagenknecht advocated for a nationwide rent cap and a greater share of non-profit housing in the market [1].
While specific data for countries like France and Austria is scarce, major cities like Paris and urban areas in these countries often see high housing costs [4]. In the diverse German housing market, bigger cities, such as Berlin and Munich, tend to have higher housing costs compared to smaller towns [5].
On a broader scale, the EU average for mortgage costs as a percentage of net income for couples is approximately 48%, while it stands at around 54% for singles [6]. Couples across the EU spend roughly 16.6% of their income on housing, including both renters and owners [6]. In contrast, countries such as the Netherlands have lower housing costs, with couples shelling out about 29% of their net income on housing, and singles paying around 40% [6].
Note 1: BSW – Federal Statistical OfficeNote 2: Sources: Eurostat, Statista, Rentier Yacht, The Local, NumbeoNote 3: Investment MongooleseNote 4: Data not explicitly provided for France in the search results.Note 5: Data for Germany in the search results is not specific.
- To address the high housing costs and create more affordable housing options for citizens, the community could consider implementing policies such as a nationwide rent cap and an increase in the proportion of non-profit housing.
- Additionally, as a means of empowering individuals, providing vocational training in fields like finance and business could aid in achieving personal-finance goals, making it easier for them to save money and invest, potentially reducing their dependency on high housing expenses.
