The IG BAU trade union and the German Tenants’ Association are urging the federal government to invest €20 billion annually in housing construction. This proposal aims to address the acute housing shortage and stimulate the struggling economy.
Unions and tenants’ association demand action
The IG BAU trade union and the German Tenants’ Association have proposed a significant economic stimulus package to tackle Germany’s housing crisis. Robert Feiger, the federal chairman of IG BAU, stated, “A large-scale housing construction offensive is urgently needed to effectively combat the dramatic housing shortage and simultaneously revitalize the weakening economy.”
The organizations are calling for a “Housing Stimulus Program” that would primarily focus on social housing and affordable living. According to calculations by the Pestel Institute, commissioned by the Tenants’ Association and IG BAU, approximately €13 billion would be required annually to build around 100,000 social housing units. Of this amount, the federal government would need to invest €10 billion.
Breakdown of proposed investment
The proposed €20 billion annual investment would be allocated as follows:
- €13 billion for social housing construction (100,000 units)
- €3.5 billion for the construction of owner-occupied apartments
- €3.5 billion for building 40,000 affordable rental units annually
Lukas Siebenkotten, president of the Tenants’ Association, emphasized the urgency of the situation, stating, “Germany needs a ‘Housing Stimulus Program.’ And not just in the election programs of parties for the next federal election, but now.”
Funding through improved tax collection
To finance this ambitious program, the study suggests a more stringent approach to combating tax evasion. According to the Federal Audit Office, the government loses between €30 and €50 billion annually due to tax evasion. By addressing this issue, the necessary funds for the housing program could be secured without additional burden on the federal budget.
