Troubling Trend Shrinking Population Triggers Explosion in Vacant Homes
While home prices in Germany's urban areas are skyrocketing, the opposite trend can be seen in less densely settled regions. There, shrinking populations are creating housing surpluses and vacant homes in a trend that experts say will soon spread across the country as its population grows grayer.
For now, things in the Altenwalde district of Cuxhaven, a port city of 52,000 residents in northeastern Germany located near the mouth of the Elbe River, still look prim and proper in that sort of Playmobil tidiness that Germans love. The little houses are packed in close together into the kind of orderly settlement one can find in thousands of places across Germany.
One-third of all of the residential structures in western Germany are single- or two-family homes built between 1950 and 1978. These were the dream houses meant to offer their owners peace, quiet and financial security. But now Germany is undergoing a generational change. There are fewer young people and more old ones, and grandma's little house has gone from being a wise investment to a money loser.
One can already see the signs of this tectonic shift in Altenwalde. It isn't everywhere, but it still can't be missed. There are houses with empty window panes, closed shutters, empty driveways and overgrown gardens. These are symptoms of being vacant or of only being inhabited by a single, usually elderly person who cannot afford to, doesn't have the energy to or simply doesn't care to keep things up. Indeed, demographic change has arrived in Germany's famously idyllic suburbs.
"Whoever built in the '70s and later continued to invest cannot assume that the investments will pay off," says Hildegard Schröteler-von Brandt, a professor of architecture and urban planning at the University of Siegen, in western Germany, in describing the situation in more and more communities. In many rural regions and small cities, she continues, there is no guarantee that selling one's house will provide enough money to pay for a room in a retirement home. This is a problem for the inhabitants of such homes because simply continuing to live as they have been offers no solution either.
"Many older people living alone are overwhelmed by their houses and property," Schröteler-von Brandt says. "Some are forced to ask savings banks for a loan in order to buy heating oil for the winter."
From Dreams to Nightmares
Such circumstances have many in Germany wondering whether the dream of having a home in the countryside is turning into a nightmare. It used to be a given that the housing developments full of single-family homes that popped up between the 1950s and 1970s would continue to be inhabited. But a recent study of the Wüstenrot Stiftung, a nonprofit foundation focused on urban planning, construction and habitation, finds that this is no longer the case.
The study concludes that more and more people are moving into city centers for a variety of reasons. Long commutes and high transportation costs, for example, are making the suburbs increasingly less attractive. Likewise, many of the older homes in the suburbs no longer meet contemporary needs. Many young families don't like their narrow floor plans, and they often require expensive improvements to make them more energy-efficient. This has led a number of experts, such as Franz Pesch, a professor of architecture and urban planning at the University of Stuttgart, to warn of a "large-scale devaluation" of the traditional areas full of single-family homes.
At the moment, the main areas being affected by this trend are remote and economically underdeveloped cities, such as Cuxhaven, in the northwestern state of Lower Saxony. But it won't be long before this demographic change also threatens residential areas in more prosperous regions. "This shift can be perceived everywhere," says Schröteler-von Brandt. "And it will impact downtown areas just as much as outlying areas."
When viewed in this light, Cuxhaven might not be the economic exception that it appears to be today but, rather, an early manifestation of a development that will spread across the entire country. This is supported by demographic data. For example, 27 percent of the population of Cuxhaven is 65 or older, and demographic trends suggest that this will be the case throughout Germany in 20 years. Urban planners have calculated that, between now and 2030, the number of Cuxhaven residents generating demand for housing will drop from 50,000 to 39,000. Of the estimated 6,000 single-family homes that will go on the market in this same period, 2,100 will be unneeded "surplus" that will become almost impossible to sell.
The same holds true for the western state of North Rhine-Westphalia, Germany's most populous. Estimates hold that there will no longer be demand for some 71,000 existing homes there by 2025. This is particularly the case in the Ruhr region, the industrial rust belt stretching from Duisburg to Dortmund, but also in other areas of the state.
A Surplus Housing Conundrum
Urban planners are now starting to contemplate what should be done with all of the surplus housing. Simply letting them stand empty would lower the values of surrounding properties. Likewise, having more abandoned houses could cause the formerly idyllic suburbs to morph into problem neighborhoods. "What's happening in these places is starting to become a very major issue," says Gregor Jekel, a researcher at the German Institute of Urban Affairs (Difu). "Already today, there are abandoned houses in areas of single-family homes in regions with shrinking populations, and the razing of such structures is being discussed." In other words, the domestic bliss of an entire generation could soon meet the wrecking ball.
Despite these developments, most municipalities continue to grant permits for new construction on undeveloped land. "Even in economically underdeveloped areas," says Schröteler-von Brandt, "it continues to hold true that the people who still have jobs and money don't want to live in old houses. They build new ones, which in turn increases the pressure on the areas with older homes."
What's more, these groups of homes built on green meadows have always been a drain on communal coffers. Although they are home to relatively few people, municipalities still had to pay to outfit large areas with the necessary infrastructure, such as streets, water and sewer pipes, schools and other social institutions. In the suburbs, all of these things are much more expensive on a per capita basis than they are in densely populated urban areas.
These per capita costs only increase as the population declines. Indeed, some places have even been required to take emergency measures. For example, if sewers are not used enough, they sometimes have to be artificially flushed out in order to keep them from clogging.