Vacancy Rates in Eastern Germany: Higher Than in the West, Part II
Let's dive into the residential vacancy rates in Germany, focusing on the contrast between eastern and western regions. Surprisingly, stats from 2022 reveal that vacancies in eastern Germany, excluding Berlin, are significantly higher than in the west. Empirica, a consulting institute, and real estate specialist CBRE revealed that the market-active vacancy rate for multi-storey apartments stood at 5.8% in the east, whereas it was a meager 1.9% in the west.
Interestingly, the highest vacancy rates in western Germany were in Pirmasens and Frankfurt (Oder), both at 8.6%, while Dessau-Roßlau in the east boasted a rate of 8.3%. However, Leipzig in eastern Germany witnessed a substantial decrease in vacancy rates, dropping by 1.9 percentage points since 2017. The cities of Halle (Saale) and Brandenburg an der Havel also experienced significant declines, while Dessau-Roßlau in the east saw a notable increase in vacant apartments by 1.3% over the past five years.
In a broader perspective, Germany's nationwide vacancy rate plummeted by around 53,000 apartments, from 2021 to 2022, marking the most significant decline in over 20 years. Empirica's analysis, however, does not account for so-called "ruins" or dysfunctional vacancies. This means that the total vacancy rate in the country is probably higher than reported.
Empirica and CBRE gather their data from CBRE's extensive analyses and estimates, which are based on around 915,000 residential units at the end of 2022. Their information, although valuable, does not provide a comprehensive assessment of the vacancy rates in each individual city or region in Germany, let alone across Europe.
Now, let's put some context into this. Although eastern Germany fares worse in terms of vacancy rates, it's essential to remember that these statistics typically vary between regions due to factors like economic development, population growth, and demand for housing. Let's not forget that Dessau-Roßlau is a city in Saxony-Anhalt, a state with distinct economic characteristics.
According to some studies, western regions like Pirmasens and Frankfurt (Oder) may have lower vacancy rates due to economic growth, demands for rental properties, and available job opportunities. On the other hand, eastern German cities might see higher vacancy rates due to a variety of factors, such as an aging population or stagnant economic development.
In conclusion, while the city of Dessau-Roßlau in eastern Germany experienced a significant increase in vacant apartments over the last five years, it's crucial to keep in mind that regional economic characteristics, population dynamics, and housing demand can significantly influence vacancy rates. In-depth research and evaluation of these factors are essential to understanding the nuances and trends in vacancy rates across cities and regions in Germany.
