The student housing crisis in Germany has now reached dramatic proportions, with some students staying overnight in sleeping bags in university sports halls. Others have accepted up to two hours of commuting every day to get to lectures. A new survey suggests that more action is urgently needed.

According to the MLP Studentenwohnreport, a survey on student housing conducted once a year since 2019 by financial consultants MLP with the German Economic Institute (IW – Institut der deutschen Wirtschaft), rent levels in the 38 university towns examined rose by 5.1% in 2023 compared to the previous year.

The biggest increase was in Berlin (9.4%), followed by Leipzig (9.3%). On average, a 30 square meter flat in Munich, Germany’s most expensive university city, now costs more than €800 (US$880) a month including heating.

To put this into perspective, maximum support for students provided via the federal grants and loans scheme (BAFöG – Bundesausbildungsförderungsgesetz) is to increase from €934 to €992 a month, and the flat rate to cover housing costs for students living away from home included in monthly BAFöG payments is to be raised from €360 to €380.

With the latter, students eligible for support could afford a 15-square-meter flat in Munich. They would only find a reasonable, affordable flat with heating in two cities, Chemnitz and Magdeburg, in east Germany.

The annual Studentenwohnreport reveals a shrinking student housing market in Germany, with some areas experiencing a decrease of over 20% in 2023 compared to 2022. The report attributes this decline to a slowdown in construction activity, highlighting the need for increased investment in student housing.

Michael Voigtländer, a real estate expert at the IW, warns that the ongoing decline in planning approvals will exacerbate the housing crisis, particularly for young people seeking housing for the first time. He emphasizes that government support alone cannot keep pace with rising costs and that only a small proportion of students are eligible for assistance. Voigtländer urges the government to take decisive action to stimulate housing construction for social and economic reasons.

The report also explores the potential impact of the housing crisis on Germany's existing skilled labor shortage. It highlights the importance of attracting and retaining international students, whose numbers have almost doubled at German universities between the winter semesters of 2012-13 and 2022-23. These students, many of whom pursue STEM fields, are crucial for addressing the growing skills gap.

MLP CEO Dr Uwe Schroeder-Wildberg underscores the need to provide affordable housing for international students, emphasizing that excellent study programs alone are not enough to attract and retain talent. He stresses that affordable housing is essential for Germany to remain a competitive destination for academic talent.

The student housing crisis in Germany is reaching a critical point, with desperate measures being taken to accommodate the influx of students. In Münster, the student union has set up makeshift accommodation in a university sports hall, providing sleeping bags for first-year students. Similar temporary solutions have been implemented in other cities ahead of the winter semester, which begins in mid-October.

In Freiburg, the student welfare service is advising students to seek accommodation outside the city for now, suggesting they find more convenient options later.

Commuting is becoming increasingly common, with some students enduring commutes of up to two hours daily to reach their universities.

The student welfare service in Münster, facing a waiting list of over 3,600 applicants for its halls of residence, highlights the particular challenges faced by international students. Their limited German language skills and inability to view properties at short notice make it nearly impossible for them to secure housing on the open market.