The shortage in building land, especially in metro areas, is one of the main reasons why housing construction in Germany has lagged far behind demand for some years now. It has recently come to light that the Federal Government, represented by the Institute for Federal Real Estate (BImA), owns no less than 971 undeveloped plots or a combined area of 230 hectares in the so-called “Big Seven” cities alone, building land that is vacant at a time when zoned plots are urgently needed for housing construction.1
As the Federal Government’s reply to a short parliamentary inquiry by the Liberals’ Parliamentary Group revealed, most of the undeveloped plot are located in Berlin. Here, BImA holds 386 plots, adding up to an area of 88 hectares. Next in line are Munich with 248 undeveloped plots or 61 hectares and Cologne with 246 plots or 56 hectares.2 Nationwide, BImA calls far more unused properties its own. Around 25,700 undeveloped plots with a combined area of 87,000 hectares are federally owned across Germany.
Government should Speed up Release of Land
In response to this revelation, demands have been raised the BImA Institute for Federal Real Estate Management should release land more quickly for housing construction. “The short supply in building land is one of the most formidable obstacles to an increase in supply and thus to affordable housing accommodation,” said Daniel Föst, the Liberals’ expert on housing policy. He called on the Government to either sell or develop the federally owned land or to build in its own right. His argument is that there is no time to lose in implementing the housing construction policy.3
This was said to have been agreed with the Federal Government anyway, as the latter intends to reform the allocation policy of the BImA institute. “We want to enable the Institute for Federal Real Estate to make federally owned plots available to the Länder and municipalities for the purposes of social housing subsidies in an accelerated process and on discounted terms,” reads the relevant section of the coalition agreement of the governing Grand Coalition.4
Meanwhile, the BImA Institute has cautioned against inflated expectations. It elaborated by pointing out that few of the properties in the metro areas are actually suitable for housing construction. Many of the federally owned properties are moreover located in economically undeveloped regions with no housing shortage and thus without any need to step up housing construction. The institute went on to say that some of the properties that would be suitable for housing construction are former military barracks that Germany’s armed forces prefer to hang on to because troop strength might be increased again at some point in the future.