Germany vs. USA: The Affordable Housing Crisis

The first 1,000 people to use the link will get a 1 month free trial of Skillshare: skl.sh/blackforestfamily07221 -- In the USA, there is no state or county where a renter working full-time at minimum wage can afford a 2 bedroom apartment. So how did the American Dream become such a nightmare? Could Germany hold the answer?
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HVAC (HLK) in German & American Homes | A Tale of Two Countries
• HVAC (HLK) in German &...
Episode 67 | #housing #housingcrisis #economics in the United States & Germany | Filmed July 7th, 2022
👉Quick Jump to Your Favorite Topic:
00:00 Intro
02:07 How American Homes became SO EXPENSIVE
04:26 What is Driving Up Housing Prices?
06:39 How I made the hand-drawn graphics in today's video
08:39 Why is the German Housing Market so stable?!
12:40 The German Rental Housing Approach
16:19 Is Density and Diversity the Solution to Affordable Housing?
19:16 The Ultimate Problem with Housing & the American Economy
21:45 Coming Up Next Week...
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Originally from the Midwest of the USA, we moved to the #blackforest in 2013 and quickly embraced #expatlife. As American expats living in #Germany, things weren't always easy, but we've grown to love our life in Germany. We started this #travelvlog​ to share our experiences with friends and family, and to help those who are interested in moving overseas! Whether you are interested in moving abroad, working abroad, studying abroad, raising a family abroad, or just want to #traveleurope, we're here to give you a first person look at what lies ahead. 😊🎥🌎

[@performingartist]

I think a barrier in the states stems from what you said in the video, that the home is the retirement saving, the nest egg. It's in my own best interest as a homeowner to limit the construction of homes in my area thus increasing the value of my existing home. I own a home in the states that I have rented out for the last decade while I have lived overseas. My mortgage payment is locked in but as both home prices and rents rise I benefit twice. I make more money off of the rent and the value of the asset increases. It's a double win. I just flew back from Germany a couple days ago for a short visit to see family and we are house sitting in a very wealthy metro Detroit suburb. Quite frankly I'm a bit sickened by the utter waste of resources. Huge McMansions with far more square footage than is remotely needed and the subsequent power needed to heat and cool it. The wasted land that is not used for anything but growing lawn grass. The gasoline needed to transport the residents everywhere because you can't do anything without driving. It just boggles my mind how any of this is sustainable. I've spent more time sat in traffic in the last two days here than all of the last year in Germany. I almost never use my car there because I can walk or bike or use my 9 euro pass. All of the construction that I do see here in the states right now is focused on these huge houses that go for $500,000 and up. I see no small houses and nothing high density. Back in my village in Germany there is ongoing construction of one and two bedroom apartments. It's night and day different.

[@k.schmidt2740]

Having just returned to Europe from Atlanta 😲, I agree with your observations totally.

[@BladeValant546]

I think we need to begin reducing the number of rentals honestly. Rentals only need to be for non residents. I think that has also contributed to the problem I say this also renting a home to people.

[@NapFloridian]

@Timcthefimguy, I 100% agree with you, I have lived over 20 years in Spain (Canary Islands) and 25 years in Spain. I was originally born in Germany *(Hessen) and the last time I visited German was in the 90s. All I can say is that Europe is less wasteful on living space as here in the US specially in Florida. The affordable housing doesn't exist in the states at all. I myself was out-priced of a 2/2 in the town where I used to live for the last 14 years. I lived in a rental unit since 2014 and the unit was still in the same state as when I moved in... no new appliances or flooring etc. Still each year the price when up,.... up until 2020 when Covid hit (at that point I was around $1700 but comes 2022 April I get a letter from my Complex manager that my new rent is starting July 2022 $2500... that is $800 increase. However, my income has not increased for many years... leave alone the financial crisis and inflation... I am highly consider returning to Europe, as the US has become unaffordable to have a fair chance of living.

[@redwolfexr]

the fact that Germany created a 9 Euro ticket while the US pushed to lower gas prices -- says a lot

[@mariusfacktor3597]

Building small houses is banned in most the land in lots of US cities. They literally have "square footage minimums" so they only allow large houses to be built, along with "parcel size minimums" which say every parcel must be a quarter acre or something like this. I wish someday the US Supreme Court would rule these arbitrary zoning laws that ban poor people from cities are unconstitutional. But we are stuck with a Supreme Court who would rather take women's medical care away.

[@Raider_MXD]

Higher density is an important aspect, because that results in lower per capita costs for public infrastructure. Single family homes on large plots of land are the worst case scenario in terms of costs for roads, sewage systems and so on.

[@justme9801]

Excellent point!!!!

[@brunopadovani7347]

One thing that the US should probably do is selectively ban foreign investment in its residential real estate market. Foreign (especially Chinese) money has massively inflated Australian, and to a lesser extent Canadian real estate. I know from my real estate cousin that this is definitely happening in NYC, which in turn affects RE prices in the entire NYC metro area.

[@crystalwhelan5393]

In the US, I feel like we are forced into the suburbs because of inadequate public transportation in cities. For example, In Boston, the red line stops running before events end and bars close. Unless you can walk or afford an Uber every day, it’s not sustainable. So we move to the suburbs, where everything is single family homes so we are forced into homeownership. This drives down inventory and prices skyrocket. My house should not be valued as high as it is now if i were to sell i would probably make 60% profit, that’s insane. But we cant sell, because we cant afford to live anywhere else.

[@DavidWilliamsaz]

Land use policies dictate transportation options. If you build more homes in urban areas urban areas would be affordable and you wouldn't have to move out to the suburbs. If you allowed suburbs to build more units per lot you would have more density more density that makes it affordable to have mass transit lits near those stops.

[@petertucker3336]

An experiment for Americans: try Googling "Who owns the most rentals in ... County". For many people in urban areas, the answer is going to be some multinational investment fund.

[@brianzabel6635]

Well yeah if you own more than 2 you also own more than 95% of property owners. An investment company can just own 10 in a market of 10,000 and can be the majority renter.

[@michah7214]

@@brianzabel6635 you don't want corporations owning property. Yes they can be small or large but if you allow it, HUGE corporations but large numbers of properties, don't pay taxes, operate absentee landlord properties and life becomes a living hell for everyone in that city. It's a blight. It's corporate greed and it's about wealthy people getting rich from the poor. That's part of the single family residence thing. Owning a house with land gives you some stability when you join with other homeowners. Otherwise corporations own everything. EVERYTHING..

[@wora1111]

I live in the "Speckgürtel" outside of Karlsruhe, one of the villages surrounding this medium sized town. Karlsruhe happens to be one of the towns with the most extensive network of Strassenbahnen (Tram) in Germany, Europe or the world (or so they say). You can literally go for hours and up to 100 Kilometers in one direction. This infrastructure is rather old, actually they took over some of the railroad tracks that were abandoned by the Deutsche Bahn and made it profitable again (they changed the track width of all the 'old' tram-lanes to be able to use the standard width of the DB with all cars of the tram). One of the improvements in the little villages was, that they moved the tracks from the outside of the village to the center of the village whenever possible (sometimes car lanes and tram sharing the same space). Actually this infrastructure was one of the reasons we moved here thirty years ago. Another thing though, this whole development was driven by a very few persons that recognized the chances they could see in the future and kept pressuring officials of the town to support them. Convincing officials of what is good planning and what is not probably ist he hardest part in urban planning. And sometimes it is hard to tell, is is lobbying or genuine concern for the urban development, that you are dealing with (as a local politician). In any case, it helps, if more people understand the situation and are able to interpret what architects, planer and politicians are trying to tell them.

[@futurerails8421]

Thoses lines aren't abandoned they are mixed use with with DB Trains this is called the Karlsruhe Modell it was invented there and has been or is been implemented in Chemnitz, Heilbronn, Kassel and Saarbrücken even with an international line to France. Total or almost total conversion of heavy rail lines happened before on the Suburban Rail Lines in Cologne reaching to Bonn and some lines in Karlruhe like the one to Bad Herrenalb and in the region around Mannheim with meter gauge heavy rail. If you only look on the tram network itself without heavy rail mixed use, the bigges tram network in Germany is Rhein-Ruhr.

[@wora1111]

@@futurerails8421 I am just wondering whether to get agitated or just assume you are to young to personally know? The Murgtalbahn is mixed use and was never abandoned. The lines through the Hardt were abandoned by the DB some decades ago and parts of that later reactivated by the KVV as S1/S11. And these lines are not used by the DB at all.

[@futurerails8421]

@@wora1111 It seem like you did not know what Karlsruhe Modell means. The Karlruhe Modell is the use of multisystem trams supporing DC tram power system and AC mainline power system and running under EBO and BoStrab. Even if some lines have no other rail traffic besides this, they still support it without special locomotives. It was invented to explicitly use existing rail lines to bridge the gaps between cities and have tramlines on both ends. Otherwise cities like Wörth am Rhein were way to small for a tram. Some lines in Karsruhe are also total converions or partial conversions from former rail lines or suburban rail lines. These things were done before for example in and around Cologne but putting a DC overhead wire instead of an AC overhead wire above a railway line and especially installing high floor plattforms limits the usability for heavy rail.

[@wora1111]

@@futurerails8421 Yep, I agree. That is pretty much what I told my colleagues about three decades ago.

[@marksimons8861]

This woman really understands housing policies.......unlike many politicians.

[@larryyoungquist6876]

Will you include how traffic planning fits into the equation, both in Germany and the US? In the US, most of our towns are designed to be car centric. Without good regional or last-mile options. And by design, encourages single family homes. In my view, housing policy HAS to be integrated with good, efficient, and cost-effective traffic planning and policy.

[@ralfklonowski3740]

I'd put it the other way round: In areas with single family homes, especially on large lots, the customer density for public transport is so low that it can't operate at decent prices. So it either is subsidized (f.ex. school busses) or simply doesn't exist. Single family homes discourage public transport. We both agree; I'm just loooking on it from the other end.

[@IgorRockt]

@@ralfklonowski3740 The difference is, that in the US, those areas were specifically DESIGNED that way after the war - they simply didn't exist before the 40s (and as such, it's not a hen and egg problem. The US had the biggest public transport system in the world before they started with Z1 zoning and suburbs - which, btw, were also created to keep blacks out, since they couldn't afford having a car, google for it).

[@karstenbursak8083]

This got a lot to do with US zoning laws

[@Dueruemtarget]

I think Ashton is an expert on housing,not so much on city planning. Jason Slaughter aka Not just Bikes is more able to explain those topics although he lives in the Netherlands and he compares Netherlands‘ infrastructure with North American infrastructure. But these comparison shows where North America has its issues in building infrastructure.

[@TypeAshton]

I am still finalizing my notes for next week's video, but I am fairly certain that I will give a section in the video to how cars play into the zoning strategy in the US.

[@erikabutler6893]

19:40 That's the housing filter mindset. Basically, lots of people who live in expensive areas like it to stay expensive, because it helps to filter out those whom they consider "undesirable". And they tie desirability to the person's wealth and income.

[@TypeAshton]

Yes this certainly plays a role. In next week's episode, I'll also bring up some studies that have been conducted which actually look at whether or not adding multi-family, low-income housing affects existing house prices.... (and not to spoil the fun, but overall, it doesn't)

[@SharienGaming]

@@TypeAshton heh i have a strong suspicion that proximity to services, grocery stores and workplaces as well as public transport may have a much more significant effect on the value of a home - looking forward to the video =)

[@Parazeta]

Sounds kinda racist to me 🙁

[@TypeAshton]

@@Parazeta In next week's episode I'll talk about the history of redlining and how we are still living with the effects of this policy today (even though it is not technically still on the books). As a slight preview - if you are interested in the subject, I highly recommend googling "The Delmar Divide".

[@ernestmccutcheon9576]

Hey Ashton, about 20% of the houses sold in the USA were being bought by corporations, that would then rent or flip them. With the increase in interest rates, these companies are dumping their inventories. In many areas, prices are dropping in double digits. I think the same will happen in Germany, when people go to refinance their 10 year loans they got for 0.7% and find out that they will now have to pay 3%. Good video, look forward to the series.

[@briananderson8428]

Exactly. The 20% figure is outrageous. The US imposes almost no restrictions on what private equity and hedge funders can purchase. Private equity's next frontier is as much ownership as possible of the medical-industrial complex. If we think the US healthcare system is inhumane now, wait until private equity runs the show. (Amazon is also trying to get in on the US healthcare scam, too.) The US is a failing nation-state. We will be the New Brazil in 15 years. As they say: Mark my words.

[@flostar81]

Very interesting video and well done. The big problem in Germany is that there are increasingly fewer small, private landlords, especially in big cities. The biggest landlords in Berlin are companies that are listed on the stock exchange and make enormous profits. Compared to 2017, average rents in Berlin have risen by 18.5%. Real wages have also risen in recent years, but to a much lesser extent. Due to high inflation, real wages have actually fallen by 1.8% compared with last year. In the past, local authorities were able to intervene in the rental market in a regulatory manner because of the so-called "social housing". However, this system has been massively scaled back in recent years. In addition, many cities and municipalities have sold thousands of rental apartments from their own stock to profit-driven large corporations. In doing so, they have also given up the possibility of being able to intervene in the market in a regulatory way. As a result, cities such as Munich have problems retaining or finding esential workers in the low and medium-wage sectors, such as nurses or firefighters, who can afford housing in the city. Especially the conservative and neo-liberal forces constantly claim that only new construction can solve the problem. But, as mentioned in the video, the cost of construction has risen so sharply that this cannot work. In addition, the climate crisis is causing construction costs to rise even higher. In my opinion, you can't let the market regulate every area of life, because that leads to antisocial results that endanger social peace and democracy in the long term. And the housing market is not the only problem of our time that needs to be solved. Anyway, I look forward to your next video and wish you a wonderful Sunday. Greetings from Berlin.

[@MsLarrythegreat]

Indeed a chronically under mentioned, other side of Germany's housing issues is _die Neue Landflucht_ (TL the new rural exodus). While long increasing financialisation of the real estate sector does push central urban housing prices, continued neglect of more rural infrastructure and development disproportionately drives a supply of people into the cities, to also fuel the competition. - After all, price (or regulation thereof) matters a lot less without someone willing (or forced) to pay it.

[@kaivr2868]

Hm, but leftist / socialist housing policies work so wonderful, correct? Look at Berlin with its "fabulous" cap on rental payments, talking about disowning private companies etc. etc. What was the result even after a couple of months? Plummeting construction activity - and no wonder, who wants to invest their money in a state where you could be disowned or you have regulations more or less making it impossible to earn a return. Yes I know - that is hard to understand for an apparent leftist like you - private companies only invest if they can earn a return and are not social clubs to please people. And if you want to look into history in Germany, you don't have to look far in the past and look at the glorious DDR and how "affordable" housing looked in a socialist state where everything was wonderfully cheap. But yeah, it is the evil big companies, and of course the "neo-liberal" and "conservative" bubble words have to be included...And it is not the climate crisis that is increasing housing costs but stupid policies which have many adverse side affects (more fire danger through all the "Dämmung" and more fungus inside buildings because they cannot "breathe" anymore), and with small Germany having basically no effect on climate change anyways (if you prescribe to the oh so dangerous man-made climate change theory). So please, go ahead and socialize home/apartment building, and see which company will give just a single euro as an investment. And continue to live in your bubble that the state is so awesome in running things - the German government in just the last two years has shown that it cannot run anything (may I just give as a small example the months and months delay in paying out Corona assistance to business which were shut down because of stupid government policies)? And the state-run "Energiewende" is also such an amazing success that funnily enough it is not an "Exportschlager" and our country is the only one shutting down power plants which run 24/7 for wind/solar which show up or not and are not able to sustain a highly industrialized country. And this already led to the highest energy prices worldwide even before the Ukraine war started. Just have a look at the statistics. And as a last point - who is responsible for inflation in the EU? Government policies like lockdowns, disrupting supply changes and complicated economic flows, plus the printing of money by the ECB for several years now to finance the southern EU states and the German government has done nothing about it. Instead, they have watched and shrugged their shoulders that every year German savings were evaporated in the amount of several hundred million euros because of zero interest rates and at a normal inflation of about 2%. And plus all the printed money is of course looking for investment opportunities and partially going into real estate, driving up home prices and rents. That is basic economics, and is the result of flooding the economy with money exceeding productivity growth. And as stated, a lot of other inflation and rising costs that tenants have to face are due to government policies (as mentioned high utility costs), but also ever increasing demands and regulations with increased burdens for home owners. And of course they pass on these costs to the tennants - would you do it differently? And your number of 18.5% rental increase since 2017 is on average around 4% p.a. - not really that huge for the capital city, where you have lots of well earning people from the political complex alone (all the ministeries, parliament employees, lobbyists etc.). Plus, it is a simple law of demand and supply - if the government allows about 200-250.000 people each into the country (one more or less middle-sized city for German standards) and they of course flood to the bigger cities where they think they have more opportunities and have already their own communities - what do you think happens? If demand increases by 10% and construction by maybe 2%? Plus the prices especially increase in the lower segment of the market, and there is lots of competition between new migrant tennants and native tenannts. But cities like Berlin of course say "we have space", but don't care about consequences (especially for people with lower income) and are dumbfounded when prices and rents increase because they created massively more demand than there is supply. That is definitely not the fault of the evil private companies. But continue living in your bubble thinking that "the market" is regulating everything and things are miserable because of it. On the contrary, in very few markets we have market working anymore in the way it is was laid out after WW2 by Ludwig Erhard, but ever increasing government interference and mingling (way beyond the "ordoliberaler" approach) - especially in construction, energy, transportation etc. So did you ever ask yourself why small private investors who maybe have a couple of apartments (through heritage etc.) do not rent them out anymore and/or sell them to bigger companies? Because they cannot deal anymore with the ever increasing costs and regulations and need expensive consultants and lawyers to help them. So for all the hassle they get nothing really in return, and thus they sell to the bigger companies because they of course have the resources to deal with these issues. And lastly, people like you seem to think that houses can just be built and they are unlimited resouces and something has to be just politically decided and then it has to wokr - have you ever considered that there is a limited number of construction companies workign in Germany with a limited number of employees? And they are asked to do so many multiple things by the government (repair / build new roads, bridges, railway tracks, windmills, houses, etc. etc.).

[@feuerrabe]

A lot of cities sold huge parts of their social housing to big corporations in the late 90ies and early 2000s. They created this problem decades ago.

[@JWinterhaven]

@@MsLarrythegreat interestingly due to covid we saw the opposite effect for a short time due to home office. The main incentive for going to the city is that the jobs are there. If you are not forced to go to them for work, many would prefer living more rural. But due to the factors you describe the infrastructure in those areas has been so neglected to the point where home office is not even possible. Basic things such as stores, internet or doctors are a lot worse in rural areas. Its a self fulfilling prophecy really

[@yasseral-saadi6557]

I love the diverse range of topics on this channel. Thank you so much for this! Really looking forward to next week’s video! I also live in Germany but I’m from Vancouver, Canada. We face the same issues that you have in the U.S. and there is also a debate there about how zoning makes it difficult to build affordable housing. I love living in Germany but what makes me sad is that even if I would want to go back to Canada one day I’m not sure I’d do that because of the housing prices. So many of my friends in Vancouver have moved out of the city because it became too expensive for them.

[@SD_Alias]

But it is the same here in Germany. In or around the big cities like Hamburg, München, Stuttgart etc. Houses or land you could build a house is not affordable for middle class people anymore. You have to move far away to the provinces to find affordable housing. But the price you then pay for commuting is also very high given today's fuel costs. So you also have to see how you get to work and plan not only the costs but also the time for it.

[@yasseral-saadi6557]

@@SD_Alias I agree that it has gotten more expensive in Germany. I live in Hamburg and I know that buying a house is not an option for me or for most people. But housing prices in Vancouver have increased by a lot more. I was actually also referring to renting. Hamburg is expensive but still a lot cheaper than Vancouver and the supply of places to rent is a lot higher here. I’m definitely not trying to make the argument that we don’t have a problem here in Germany. I just mean that certain factors in the U.S. and Canada make the problem even worse there.

[@TypeAshton]

Thank you so much! I am also looking forward to continuing this series. There is so many different facets to housing that I hope to discuss in the following weeks - Zoning, in particular, I think is going to be very juicy!

[@SD_Alias]

@@TypeAshton I hear that term zoning the first time. I googled it and find only that it is for calculating the rent of commercial shops or offices. I will wait for your video about it…

[@htfomaha]

After listening to a coworker talking about apartment rental prices in my area (Omaha, Nebraska) I did some quick research. A 2 bedroom apartment anywhere in the city costs about the same as an equivalent apartment in Marienplatz neighborhood of Munich. It is unfathomable to think that the "very affordable" city I live in is just as expensive as the most expensive neighborhood of the most expensive city in Germany.

[@blcrusher]

damn, for real ?😬

[@flx2525]

Did you compare a 2 bedroom apartment with a Zweizimmerwohnung? Because that's different. 2 rooms in Germany is a one bedroom apartment in the US.

[@SD_Alias]

Did you also compare net earnings?

[@StripLV]

I dont believe that. a 2 bedroom in Munich is about 1500-2000 euros

[@SharienGaming]

@@blcrusher yeah rents in the us are on average 70% higher than in germany (goes up to 150% for especially the smaller ones)

[@RebellHAI]

Ashton, congratulations. Your editing skills and setting your own style in your videos are skyrocketing these last few videos. This one is no exception. The use of short clips to underline your argument is nearly perfect. I like how you show additional text in these cut papers. And of course: The use of this animation is perfect for this kind of video and information. Since receiving your Ph.D. you really put a lot more effort in your videos, and it is definitely worth it. It really helps to make such dry stuff a lot more conceivable.

[@TypeAshton]

Ah wow, thank you so much! I'm still learning, but I am excited to really put my full effort into these videos.

[@deirdrevergados971]

What I admire most about the German cities are the beautifully preserved areas of Heildleberg and Tubingen. I understand that the government actually provides financial incentives to residents in order to restore and repair their 3 or 4 hundred year old homes.

[@RustyDust101]

Hi Ashton, yepp, I definitely noticed the recent upticks in video editing and graphics quality. A lot. Nive work, constantly learning new skills, and applying them to your channel. Keep it up. These are professional level videos on par with large TV stations, and when it comes to the research, they seem to be even more in depth than many TV stations. So again, great work, and keep it up! 😘😘👍 Thank you soooo much for that "No, God, no, please, God, no, nooooo" skit from the Office when I saw that hooooorrible apartment complex. Rarely was this meme more fitting than here. 😲 Having that architect hanged, drawn, and quartered is probably an acceptable punishment for that monstrosity. 😂 Barriers for Hamburg are almost exclusively applicable to Hamburg (and the other two city-states of Germany, Berlin and Bremen). Simply put, Hamburg has reached the limits of expansion inside its own state borders. While yes, there are a few lots left over which might be zoned for multi-family housing, the problem is that the office-building-boom since the 2000's has reduced the available lots by a huge margin. Meaning that the currently available open lots have to be carefully managed in how they are used. But the owners often don't WANT to support the demand for low-income housing when their lots have seen an increase in value by more than 200% in the last two decades. The single largest new plots in the Hafencity in Hamburg has literally been created by shoring up the river and MAKING new plots inside the city. But this comes at huuuuge costs, instead of simply declaring available natural land as an area for building such housing. Making such areas prohibitively expensive, thus unavailable for affordable housing. Other areas are reclaimed moors and marshland that are designated as potential flooding land during extreme weather situations. Since the Hamburg Stormflood of 1962 the city has been incorporating such areas as potential release valves for extremly high flooding events. They are all upriver, very close to the A7 Autobahn and the A255 with its extremely dense traffic, making them even less desirable, even IF they were rezoned. The only other possibility for gaining new plots is demolishing old buildings and rebuilding. But this again increases cost, thus final pricing. Affordable housing has been on the agenda of most left-leaning parties in Hamburg for at least the last two decades, and is constantly reiterated. So Hamburg's limited area has made Hamburg one of the most expensive cities in Germany for owning a home.

[@annamc3947]

I live in a very expensive area, the SF Bay Area. After 50 years of opposition to development, people are finally coming around to an awareness that the old NIMBY model doesn’t work. However, a lot of the cities here also have rent control. And many tenants with rent-controlled apartments are the worst NIMBYs, because they have way below-market rents and don’t want to have to move to allow bigger buildings. They support anti-development candidates. You mentioned Germany has a lot of renters and also rent control. How does Germany avoid that problem?

[@TypeAshton]

There's a few things going on, but I think there are two big reasons (and fair warning, I am generalizing a bit here because there are always some caveats). 1) Most German rent controls doesn't mean that your rent is fixed, but that your rent can't be arbitrarily increased. For example, rent control has been in force in many of Germany's largest cities, including Hamburg, Berlin, Stuttgart and Munich, for many years. This stipulates that “cold” rents (excluding utilities) cannot be more than 10 percent higher than the local comparative rent. In addition, rent cannot also not increase dramatically from one year to the next. The landlord is allowed however to increase the rent up to 15% within a 3 year period. But this increase should be "justified". 2) Development in general - especially the demolition of an existing building to make way for a new development is a tedious process in Germany. However, if the landlord decides to sell the building you are living in and the new owner wants to kick you out - there isn't a whole lot you can do.

[@annamc3947]

@@TypeAshton here the tenants or neighbors would sue and tie the developer up in court for years until the project is no longer financially viable. The state is now passing laws to try to prevent this by preempting local laws, but so far it hasnt made much of a difference.

[@danataplin7933]

Very interesting and, as usual with KZbin videos, so are the comments. I think the difference in fiscal incentives is important-- that German localities are rewarded for population growth while US fiscal zoning tries to keep population down so as keep the costs of more school capacity and other public services from rising even faster than they do anyway. Whether there's any room in the US system to change the incentive structure I don't know but that's an important, maybe overlooked factor in the US housing predicament. Interesting to see the shots from overhead of typical German town layout-- so dense as compared to our single family house pattern. That's a much harder thing to change; it's economics but has a big cultural dimension too with the house on its own plot of land as an ideal residential setting. Even the older, denser cities in the northeast and midwest follow the single house model much more than Germany; it's just that the houses are left over from the streetcar era so they're close together and often two or three dwellings per house. Even then builders were responding to popular desire for free-standing houses even if not single family or on more than a deep narrow-frontage lot. Don't know why so many people are recommending she watch Not Just Bikes-- if anything, he'd broaden his perspective by watching Black Forest Family!

[@jmpht854]

Great video! I've lived in North America off and on for years, but I'm currently on my first stint in a Canadian city (a decent-sized one out on the Prairies) and I've found the housing issues here fascinating. The cost is much better than elsewhere in Canada, but affordability by local cost is still a mess. My family wanted a central, walkable neighborhood, but when we looked at the city centre it quickly became clear that we would either be in old, cockroach-infested buildings with little to no security or in very expensive (Toronto expensive), newer buildings...right next door to the cockroach-infested buildings with fights and drug deals going down most nights. And mixed in with all of that are the mid-range, more affordable apartment buildings...all of which are for seniors only. It feels so close to being well planned, and yet so far at the same time! (The few buses and 20-minute walk to the main supermarket in the area aren't ideal either TBF.)

[@oakld]

Nice in-depth video. It reminds me of some messages from Not Just Bike channel, which has some videos on zoning in US (vs. Europe/NL), about tax revenue from typical US towns vs. european, etc. He puts it in much simpler words, so it's good for us, who don't have deep understanding of the subject. This video is more like a detailed study :-). Good job!

[@jpdj2715]

I live West of Germany and we, again, have upwards pressure on the housing market. Much higher fraction of ownership, I guess, than at the neighbors. Also, the price differences per blended square meter house, square meter plot and cubic meter house, typically are significantly higher in the denser populated region of the country (cf. "coastal" USA). The problem in these markets? When you move from the "expensive" to the "cheap" side of the country, you step out of the inflation spiral on the expensive side and most people will not be able to afford a return into that spiral at a level they will find acceptable. Leaving the "coastal" US for a stable or cheaper German market may have the same effect, I guess.

[@DJDoena]

One other major difference is though: If you can't pay mortage on your house no more in the US, the bank gets the keys and the debt is on the house. In Germany if you fail to pay your mortage, the bank gets the keys and you still have to pay the rest of the debt until it's fully paid off.

[@manub.3847]

Now that you mention it, it strikes me that in our small town and neighborhood, apartment buildings actually "frame" the single/semi-detached and townhouses. And that since the 1990s most of the "new development areas" here have followed a similar principle. Either with apartment buildings or with terraced houses that surround the "inner area". It is currently being examined whether old properties can be divided in order to build additional single-family or terraced houses in the "2nd row". Often old buildings with large lots are demolished for closer development. Sometimes apartment buildings or terraced houses are built. And at the same time, it is often checked how far away the nearest school, kindergarten, shop is, or in this new development area, a part is diverted for the new construction of these units.

[@toniderdon]

It is true that housing prices over the whole country of Germany stayed the same I think, because houses in rural areas in eastern Germany are still cheap af. But looking at Frankfurt and Munich, we should be really worried. According to a report by UBS (swiss bank), Frankfurt is in a bigger housing bubble right now than San Francisco or New York City. While renting in Frankfurt is still "cheap", buying has become impossible basically.

[@lizmagno1]

Excellent presentation! Thank you!

[@andreashuber6145]

Just stumbled across this beautiful channel while browsing youtube and have to say thank you for explaining the housing market in Germany and the US in such an understandable way and providing this detailed information on how they work. I'm also living in in the black forest but I think nobody explained the local policies and developments better. Thanks!

[@TypeAshton]

So glad you enjoyed the video!! Thank you.

[@Beeboop10000]

Ich arbeite im Handwerk und habe den Anstieg der Preise letztes Jahr mit Schrecken gesehen. Die Einkaufspreise sind im letzten Jahr gerade bei den Baustoffen; speziell bei Holz; um bis zum 5fachen gestiegen. z.B. m³ Holz von ca. 250 - 350€/netto ohne VAT; je nach Sorte und Art; zu Beginn der Krise im Einkauf auf bis zu 900-1.350,- €. Das hat sich zwar wieder im Laufe dieses Jahres auf einen Preis von ca. 320-400 € eingependelt, aber im Augenblick ist wieder ein Anstieg zu verzeichnen, z.Zt. ca. 480,-. Auch andere Baustoffe; Dämmung, Metall und anders; hat da letztes Jahr munter mitgezogen. Vielleicht liegt es aber auch am Export. Letztes Jahr z.B. war Holz und deren Endprodukte; KVH, OSB und anderes; in Deutschland knapp, aber der Export dieser Produkte; über den Rostocker Hafen; hat sich zu der Zeit nach China und den USA mehr als verdoppelt. Wer kann da noch bauen oder will bauen, das deutsche Modell für kleine und mittlere Einkommen kommt da nicht mehr mit. Auch Ihr habt das ja durch euren Hausbau mitgemacht, mit Sicherheit wurden Preise bei eurem BV angepassst. Aber viele kleine Firmen haben versucht, diese Preise nicht komplett an den Kunden weiterzugeben, was nicht immer möglich war und ist, wenn sie überleben wollten. Auch viele Städte und Gemeinden sind auf den Zug aufgesprungen und haben die Grundstückspreise erhöht, um eine schnelle Mark für die Haushaltskasse zu machen. Das geht auch gerade deshalb, da bebaubarer Platz im Gegensatz zu den USA in Deutschland ein rares Gut hier ist. Wobei ich hier keine Verschwörungstheorien verbreiten will, aber der Konsens, der hinter hinter den Erhöhungen über alle Produkte hinweg liegt, macht doch nachdenklich, vieles ist Hausgemacht und nicht nur den Krisen; Corona und Ukraine-Krieg; geschuldet.

[@Oldmarty]

Freunde die bauen wurde von Baustoffhändler gesagt das vieles was zZ knapp und teuer hier ist, exportiert wird. Man bekommt da halt einen besseren Preis. So ist der Kapitalismus halt. Aber natürlich spielen auch Corona und Ukraine eine Rolle.

[@justme9801]

Thank you for choosing this very interesting topic. Very informative. You did an excellent job and I definitely will watch the next one. Good job, well done !!!!

[@TypeAshton]

Glad you enjoyed it!

[@frauteacher]

My 18-year old daughter showed me how to look for the "Playlist." That was helpful. We are all enjoying your videos in our family.

[@frerkshow9874]

Hey thanks for this type of content. I wonder if you aware of the Mietshäuser Syndikat (MHS) . It's a system founded in Freiburg to buy houses collectively and decommodify the houses they buy. Project of the mietshäuser Syndikat can be found all over Germany but in Freiburg they become really a bigger player. So when the city plans a new housing area they ask the mietshäussr syndikat first. One of the reasons is, that rent prices in a MHS Project never rise. Maybe the MHS is a interesting topic for a future video of yours. Cheers

[@TypeAshton]

YES! this is a very fascinating subject - actually one of my student's did a research project on the MHS in Freiburg.

[@marie9814]

I like the wide range of topics here. That is really interesting. Looking forward to more videos on that topic!

[@TypeAshton]

Thank you so much!

[@tullio0]

Impressively great video! Thanks very much!

[@TypeAshton]

Thank you!

[@robwilliams2410]

I usually skip through the Skillshare ads, but I was so intrigued by the graphics - which I did indeed notice before you mentioned it - that I watched the whole thing. 😉

[@TypeAshton]

Ah cool! I really mean it when I say that the program I used to create it was REALLY user-friendly. I picked it up with just an hour's practice. I love some of the more "powerful" programs like Adobe After Effects, but I am still not proficient enough to churn out graphics with the same pace.

[@investigationcommittee]

Oh yeah house prices are insane. I always do a lock at zillow and its crazy to see that some houses got sold in 2018 for 600k and now people try to resell it again for 1.2 Million. All House prices made a big jump up. Well, maybe we will just buy a piece of land and Build our own house might be cheaper at the end.

[@albrechtquincke5008]

Even as an architect I can really learn a lot from you. Way to go, Dr. Schottler!

[@TypeAshton]

Thank you so much! So glad you enjoyed the video.

[@arnodobler1096]

Hi Ashton, Jonathan and Jack. I only know American cities and suburbs from afar. Especially these huge residential areas with nothing but one house next to the other, I imagine a terrible childhood. I live here in a suburb in a play street, the children (up to 20) play catch or football, race through the street on their bikes or scooters. They can be at a bakery or a supermarket in 5 minutes to buy something sweet. They can cycle to the lake or forest in 5 minutes. They grow up more independent - more free. I always have to smile when I see or hear them. 🙋‍♂️

[@LaureninGermany]

Hi Arno! Yes, the more I compare, the more I realise why American families are so happy to move here. I completely agree with what you wrote.

[@arnodobler1096]

@@LaureninGermany Thank you Lauren. I've been wondering a lot lately if this mass of school shootings doesn't have something to do with it. Kids are frustrated to the point of mental disorders when you're barracked like this!? 🤔🙋♂️Happy Sunday to you

[@LaureninGermany]

@@arnodobler1096 oh my goodness, I could imagine it contributes. Because when you all hang out together, then frustrations normally don’t build so much. Fights happen, and things are all more out in the open. Parents see their kids are not socialising normally. I‘m not an expert, I hope this doesn’t sound ridiculous. Have a lovely day - bald bist Du aufm See! (Ooo I’m a poet, I didn’t know it)

[@arnodobler1096]

@@LaureninGermany Haha ja bist du eine Dichterin mein ich Ja sehe ich auch so, aber wir sind natürlich beide keine Spezialisten!

[@papamaanbeerVideo]

the free hand drawing is really impressive

[@briananderson8428]

My laugh of the week was definitely from your clip of Steve Carrell yelling, "NOOOOOOOOO GOD!" regarding the hideously tacky American re-fashioning of Neuschwanstein as an apartment complex in Michigan. Only in the United States. I am hoping to re-locate to Deutschland in 2024, and these videos have been very helpful. And thanks for the humor, too!

[@kemaldjakman183]

Like this very much! Can't wait for the next episode!

[@dinola3268]

Wieder ein schönes D/USA Vergleichsvideo. Folgende Ergänzungen sind aber notwendig: a) Trailer und Mobile Homes (Texas, Florida, Louisiana). Etwa 500.000 Wohneinheiten in den USA, gibt es in D - mit Ausnahmen - so gut wie gar nicht als permanente Wohnungen (entgegenstehende Bauordnungsvorschriften). Das ist die preiswerteste Möglichkeit in den USA "im Eigenheim" zu wohnen. Ist - gebraucht - auch für 2 Personen mit "minimum wage" erreichbar. Nachteil: Soziale Ausgrenzung! b) Gated Communities/Country Clubs als Wohnanlage (“the very essence of American upper-class.”) Etwa 500.000 Gated Communities und etwa 10.000 Country Clubs mit Wohnmöglichkeiten für Mitglieder. Das Gegenteil der "Trailer-Parks" aber Wunschidee eines jeden gut verdienenden "Managers" (wie in D das Traumbild eines "freistehenden Einfamilienhauses"). c) Haus oder Wohnungen mieten: In D gab es im Jahr 2017 allein 226.933 Mietprozesse, 1,1 Millionen Menschen suchten bei Mietervereinen Rat. Kein Modell für die USA mit einer viel kleineren Anzahl von Richtern/Gerichten pro Kopf der Bevölkerung, keiner hinreichenden Prozesskostenerstattung oder Prozesskostenhilfe. Wie in Frankreich oder UK muß man halt in den USA die Wohnung oder das Haus kaufen, wenn man nicht preiswert in "Oakland West, CA" wohnen will (150 Straßenmorde jährlich). Wird die Hypothek nicht bezahlt, kann die Bank das Objekt ohne aufwändiges Zwangsversteigerungsverfahren selbst verkaufen. Darüber hinaus ist auch das US-Eigentumsrecht viel flexibler als in D, da z. B. auch zeitlich befristet Eigentum zulässig ist. In D sind die Bauvorschriften extrem, daher gibt es keine richtigen "Hochhäuser".

[@alanklainbaum1473]

Very interesting subject. Please continue with these type of videos.

[@SchlawinerUSA]

again such a good video, i love watching your videos, and it is a very interesting topic and i learned something new :) thank you so much for your effort! and a compliment, the editing is very good, sounds, graphics and so on, on point, not to loud or over the top graphics. i love it! and i love the office :D

[@martinaneuer5710]

Thanks a lot for your very interesting video. Lots of new information for me as a German living my whole life here. I really appreciate your channel.

[@o.b.7217]

Not an expert on that matter, but... ...if the number of houses available on the market is the lowest since whatever, while at the same time, the number of people willing to buy a house is the highest since 2006... Well, then of course the prices are high, no? Demand dictates the price: Low supply, high demand - high prices. High supply, low demand - low prices. That's how the market works. More so - that's how it is supposed to work.

[@immeremma]

I'm excited to see more videos from this area of your expertise

[@TypeAshton]

Thank you so much!

[@serge..k]

When an American got out of comfort zone, migrated to Germany, learned Deutsch and bought a house there, that says everything about the evolution trend in living standards)

[@indrinita]

This was so well-researched, evidence based, informative and understandable, well done!

[@richteffekt]

Wait, apartment- and single family homes in the same neighborhood? But- we were told these would never exist in the same place - like penguins and, you know other penguins.

[@udomann9271]

Wow .... I am almost speechless, that's why I write my comment down here ..... you managed to explain a very complicated situation in a way, that everybody could easy understand, you were short and at the same time you explained every aspect, and on top of it, you managed to explain the differences between USA and Germany. But .... I can not agree with you, that housing in Germany is cheep, the opposite is the case, renting is something like play with the wheel of fortune and building a home/house is extremely expensive. 10 years ago it was wayyy cheeper, I bought my house in 2011 for 135.000 €, it has now a value of at least 220.000 €, the house of my parents was build in 1978 (a two-family-house) for 187.000 DM (Deutsche Mark), that has now a value of at least 250.000€. My parents bought the ground for building the house in 1974 for just 10.000 DM (1.000 m²), now here around that house, even building-ground half that size (bigger sizes are not affordable anymore) will cost you at least from 100 € per m² on, if you are so lucky and can buy one.

[@TypeAshton]

Hi there - to be clear, I mentioned that housing in Germany is stable, not cheap. There's an important difference there as the housing market is less volatile to changes in the wider economic market (such as the crash of 2008) - BUT (and it's a BIG but...) prices are still high and inflation is causing prices to increase faster. There's a really great graphic done by the International Monetary Fund that shows House Prices (and rent) compared to income - and in both categories, it is higher in Germany. www.imf.org/external/research/housing/

[@jochenlutz6524]

I am living in a modern village with a very good infrastructur and many shops, doctors and a pharmacy . It is located 20 min. away from a big city with 200.000 inhabitants (including an train-station). The Autobahn is 1 km away. In our Village (2 villages united in 1 district) one family houses are built all the time and at the moment 3 bigger buildings for elderly people are built respectively under construction. Furthermore we have an open-air bath, a football-club, a tennis-club and a gym. Last not least we have got a wonderful nature and it is really quit. So no reason at all to move to a town. :-)

[@normakrahe3671]

May I ask where you live?

[@TypeAshton]

Your village sounds a lot like ours (except we are a lot smaller). Our town has about 25,000 people and is about 20 minutes from Freiburg. We moved here because 1) we could afford to buy here and not in the city and 2) It has great infrastructure (shops, regional train to the city, public pools & parks, and quick access to the forest).

[@jochenlutz6524]

@@normakrahe3671 Habichtswald near Kassel

[@normakrahe3671]

@@jochenlutz6524 Thank you! We are exploring where to move in Germany. That region hasn’t been on our radar, but you make it sound like an area to check out. 🙂

[@chkoha6462]

The three L would also be applicable here in Germany...Lage,Lage,Lage. The Mantra for each Real Estate manager. Around here, 30km North of Frankfurt, prices for houses and apartments have gone through the roof in that last year's.I am sure a lot of new home owners will struggle now with raising interest rates plus higher cost for energy

[@TypeAshton]

I think we are heading towards a breaking point. Between inflation and the rising cost of energy, it really is putting a strain on so many right now.

[@samanthawho9591]

Wow, this video was so insightful, can't wait for the video about zoning laws in the US.

[@TypeAshton]

Awesome! I am also looking forward to continuing this topic over the next few weeks

[@cinnamoon1455]

In Switzerland we have insurances increasingly gobbling up properties for development, which further increases prices. Also Covid brought a considerable upswing in house prices in rural areas because when in home office you naturally prefer to do it in a nice environment and proximity to your workplace matters less. I think zoning laws are certainly a very important aspect. Here, building zones limit not only the allowed height, they also limit how much of the property area may be covered with buildings. This often limits the owners possibility to densify. I think laws like Canada's allowing laneway houses are very encouraging to densification without needing to tear down existing buildings. My grandma's property in Germany even had a significant portion of it where it was prohibited to build anything above ground level. You could put a subterranean garage there or a pool but no building. Revisiting and changing such zoning laws would allow for a lot more density in such suburban areas since larger lots could be chopped up into smaller, more affordable lots.

[@TypeAshton]

Here in Freiburg I have also heard from those in the real estate business that a lot of properties are being bought up by Swiss developers because of the proximity to the border.

[@nachbarslumpi7093]

Stadt- Regionalplanung immer wieder spannend. Danke. Zum Thema zoning finde ich die Beiträge von notjustbikes auch immer sehr spannend, dort liegt der Schwerpunkt allerdings auf dem Aspekt des Verkehrs

[@pawl23]

The fact that Germany's population hasn't grown since the 70's while housing construction has persisted has kept demand soft as well. Similar thing in Japan.

[@joories]

It has grown though. Germany’s population in 1970 was 78 million and is over 83 million today. So more than 5 million extra people to house is quite substantial I would say.

[@pawl23]

@@joories That's still tiny by percentage the us grew from 205 million to 329 million in the same time. That's 37% vs Germanies 8% growth.

[@arnodobler1096]

Germany half size of Texas with 83 Mio People 🤔

[@VeolonMedia]

Hi, you made a glaring mistake! In Germany, 48% of all people live for RENT - this costs about 60% of income after tax, plus there are horrendous living expenses such as gas and electricity. - That means that 48% of all people here in Germany have spent around 70% of their income on accommodation throughout their lives without having built up a fortune. So you have nothing to inherit and hardly any money to live on. Here almost 48% of the people only work to survive. The other part "the owners" lives at their expense - greetings from Germany. (and by the way in Russia 92% of all people live in PROPERTY)

[@mr.t993]

Its not 60% of income let alone 70%. I don't know where you pulled those statistics. You can buy cheap houses in Germany too if "PROPERTY" is all you are after. Just go to east Germany, there are a lot of dirt cheap houses you can buy. Oh and I would personally rather rent in Germany or anywhere else in the western world than own property in Russia.

[@klausbeeblebrox64]

Thats a quite onesided comment. Let me speak for the "owners" (private ones - companies will obviously try tobmake more Profit). I built a House a few years ago for about 600000€ and included a small flat (35 m^2) to rent. We are somewhat rural here (but near Freiburg 😉) so I decided to take 300€ (cold) wich seems quite reasonable to me. I myself now have to pay quite an amount of interest and maintainence and If anything get's broken I am called to fix it while the renter (or rentee or something?) hast no trouble and keeps full flexibility to move somewhere else if he should want to etc.. I would say both positions have up- and downsides...

[@CaraBirkholz]

Such a huge and important topic these days. Thanks for your video.

[@TypeAshton]

Thank you so much!

[@DisinterestedObserver]

I’m looking forward to your next episode. I can already sense where it is going to go. I live in a moderate sized city in Massachusetts and housing along with just about everything else is much more expensive compared to most of the US excluding NYC, DC, SF Bay Area, and Seattle. My city was always a starting off point for many people starting to climb the economic ladder. My city has been busy increasing housing availability by turning former textile mills in low income housing which has substantially increased the population and expenses but doesn’t generate much tax revenue. While I live in a single family zoned neighborhood, many of the houses have turned over in the last decade or two and it appears multiple families are now residing in a number of these houses. This has resulted in a much noisier environment with way more cars so while the 1 or 2 family cars of years ago used to fit in garages, today a third and fourth car are now parked on the street. Again, this increases population but expenses increase even faster not to mention making plowing snow more difficult. So while people are advocating for higher density, I see a downside to it. Less than 0.4 miles from my house is the city/town border where the adjacent town with larger lot sizes required by their zoning hasn’t seen multiple families moving into single family homes with its attendant issues and as a result the property values in that town are increasing faster than my city. The adjacent town has no problem paying their way from local revenue sources as it’s planned ahead for commercially zoned areas which bring in revenue but not many expenses. Therefore, the town provides great services including top notch schools to their residents while receiving substantially less revenue overall and on a per resident basis from the Commonwealth compared to the revenue the Commonwealth provides to my city while the Commonwealth is also essentially paying the entire school budget of my city. One last thing, your graphics are over the top great!

[@TypeAshton]

During my PhD, I spoke quite a bit with low-income housing developers about what are the most significant pre-development steps community members get the most invested in, and they overwhelmingly talked about traffic studies and parking strategies. For new developments, especially when constructing multi-family projects with an increase in cars, they are actively working with planners to address traffic and parking issues. However, with infill projects this can be a LOT more difficult - especially if the area in which they are "in-filling" with multi-family housing is not well connected with other forms of public transit that make commuting without a car more feasible and the streets were designed for a lower traffic flow... it can be a very difficult and complex problem to fix.

[@DisinterestedObserver]

Dr. Ashton, Thank you for your reply. It is a tough problem.

[@MegaBait1616]

I love Cape Cod n eastern coast but Taxachusetts is out of control n bought a house in NC.. Same as Ma. but less rules, laws n taxes... Plus year round fishing n isn't anti 2nd. Amt... be well.

[@awijntje14]

Fantastic video can't wait for the next video. What I do wonder is how the finances work in other countries. For instance in the Netherlands your mortgage is based on your annual income and banks look at your employment status. Having a permanent contract is handled differently from temporary or freelancer contracts (requiring different types of proof you will be able to pay your mortgage). Also some parts of the mortgage are tax deductible and home ownership is "encouraged" (granted these rules are changing). Local government get some of their funding from taxes on housing but they might also get some from the government based on population (not sure). Anyways absolutely loved this episode and can't wait for the next one!!

[@TypeAshton]

I can only speak from our experience - but when we were applying for a home loan in Germany there were a LOT of factors that they considered. For example, although both Jonathan and I are equally liable to pay the loan, we only moved forward with Jonathan's income to be factored when determining how much money we could be lended - because 1) He is the only one with a permanent residence permit (I have only a temporary permit) and 2) I was/am self-employed so the documentation and weight given to how much money I make was negligible.

[@awijntje14]

@@TypeAshton sounds like the German system is somewhat similar to the Dutch (my sister is self employed and they did roughly the same thing). I do wonder how this works in the US especially in the so called "at will" states (how do you "prove" you have a stable income in such situations)?

[@TypeAshton]

@@awijntje14 So when I bought a house in the US the requirement to prove stable income is a requirement from the bank and mainly boils down to the type of contract you were given (open-ended versus limited) and not necessarily the product of at-will laws. For example, it was difficult for me to get a loan in Missouri because as a University Instructor, I was on a year-to year contract for teaching. I had to get a letter written by the dean of our department stating that it was his intent to continuing hiring me each year because of my value to the program. However, had I been a part of the professional staff (and not academic staff) where you are just hired on as a full-time employee without a limited contract, even if my income was lower, I would have had an easier time qualifying for a loan.

[@awijntje14]

@@TypeAshton ah very interesting sounds somewhat similar to the EU in terms of banks wanting contracts and using those to assess their risk and amount one can borrow. Ah so I was under the impression that "at will" basically means "without a contract" so I assumed (yes, yes assumptions...) it would be nearly impossible to get a loan but from what you said I guess this is not a factor for banks. Last question (because I could go on for hours) is there in general a difference between the types of contracts people have and their education (I.e. highly educated = strong contract, less educated = weak contract) as I personally think education is the way for people (and countries) to rise out of poverty and create a society that benefits everyone.

[@machtmann2881]

I came across Alan Durning and the Sightline Institute's article series recently too and was really hooked! It truly illustrates that you get what you incentivize, whether that's a good thing or a bad thing.

[@TomsTutorialsAndHowTos]

I think that those graphs don't tell the whole story, as they are normalized over the whole country. I know that on the Polish or Czech borders, you can get a house dirt cheap. But where we live, houses have jumped from 400k to 1.3M in the last 10 years. And we are 1 hour outside of Munich. I am sure a lot of people would agree with me, that where there is work, infrastructure, and leisure activities, housing in Germany is implausible for all but the highest earners, or inheritors.

[@colmcorbec7031]

There is nothing in those border areas. Like living in the middle of nowhere Montana.

[@huubjoanfranssen8980]

More affordable does niet equal affordable. That in many European/western countries economical centers have increased disproportionate in cost of living is at least anecdotally correct. Germany had/has a relative stable housing market. That doesn’t mean it is is without its issues. I do think it is also about making privately the right choices. Maybe even more so. I am not dismount that allot of people agree with you. People feel it in their wallets. However it is also about the underlying economics. Your salary is also not the same as 10years ago.

[@TomsTutorialsAndHowTos]

@@colmcorbec7031 That's why they are cheap.

[@TomsTutorialsAndHowTos]

@@huubjoanfranssen8980 Haha, my salary has not changed much since then, other than the Freibetraege from having children. In the industrial industry, salaries get capped at a certain Entgeltgruppe.

[@MAD8MATT]

And still your union has negotiated increases to the whole table year over year.

[@juliaclaire42]

Great video about a heavy topic. I have to re-watch it to get it all.

[@SD_Alias]

It all depends on region in Germany. Here 90km from Hamburg direction northwest. A 100year old brick build house which needs some renovation like a new heating system and some insulation could be bought quite cheap for about 120000-180000€. The same kind of house within the circle of 40km around Hamburg would cost about 500000€. But such kind of Houses are very rare in the near of big cities today. Most of them are already renovated and would cost more than 700000€. That amount of money is not payable by average German.

[@norwegianblue2017]

Housing prices have gotten completely out of control here in the US. I think it is more of a product of inflation and economic fears for the future than of organic demand for housing. Not to mention no shortage of wealthy foreign nationals (mostly Chinese) and corporations who are desperate to get their money into something tangible. My sister is currently trying to buy a home here in San Diego. She has a short list of reasonable requirements. 1. Needs to be within 5-10 miles of the ocean. 2. Doesn't need to be big, but she doesn't want a little bungalow. 3. Has to have at least a small back yard. 4. Needs to have something of interest within walking distance (coffee shops, restaurants, bars, etc.) 5. If it has an HOA, needs to be less than $400/month. She has a budget of $1,100,000 and she can't find anything.

[@StrassenbahnBen]

You make me appreciate my country a bit more. Thank you.

[@LaureninGermany]

17:50 Thank god you said it. Looking forward to next week’s video, this is all super interesting and making me appreciate Germany even more. I’m trying to compare all this with GB. I think it’s a different situation altogether, definitely more home ownership and single family homes compared to Germany.

[@MechmanGetrieb]

Interesting! I startet my House build mid 2015 and moved in mid 2016. So I literally finished just right bevor the prices soared even higher :)

[@darkredvan]

Prices for building houses are going up steeply in the last ~ 5 years , especially comparing 2020 to 2022, and they are still going up. If you could build a one family home in 2017 for about 300 - 350k €, the same house will cost about 450 - 500k today. So one could talk of an increase of about 30 + %. Construction of. new houses (and larger apartment buildings) is grinding to a halt, contracts revoked. This is true for professional investors as well, as profits might get quite uncertain due to renters going broke in numbers due to exploding energy costs. Though prices are still high for buying used houses, they will go down when more and more owners can not pay the rising costs of living, energy and credits. The crisis will slash property value massively, hopefully not as much as it did ~ 97 years ago.

[@michalziobro7890]

I cant agree that prices stay the same. I think condo prices went up by 100% in last decade. I remember prices between 2-3k in Frankfurt or Berlin. And now they are closer to 5-7k and more

[@k.schmidt2740]

Great video, Ashton. This is discussed much too little on social media.

[@seanedging6543]

Excellent video! I can definitely attest to the American fixation on homeownership as someone working on housing policy at the moment. I don't think a "reset" of our psyche is going to happen anytime soon, but I think there are ways to creatively build more housing diversity without running afoul of the American ethos. I think a place where there's quite a bit of opportunity is changing state laws to facilitate ownership of denser housing types - including condominiums and limited equity home cooperatives. I've found this to help disentangle the notion that "ownership" is equivalent to "single family home". Then it becomes much more feasible to promote housing diversity (note: I also use 'diversity' over 'density' because people freak out at the latter, which makes sense - '32 du/ac' is much scarier than a picture of a quadplex). Another thing I question is the economic theory around fiscal zoning. I feel like if this was effectively playing out in American communities, they wouldn't all be so broke! If anything, high density zoning makes the most sense from a fiscal zoning perspective (more ratepayers on less infrastructure maintenance liabilities), but most U.S. jurisdictions have done the opposite, and - surprise surprise - their maintenance liabilities are so great, they have to shift infrastructure costs increasingly onto developers.

[@thats_guip]

I love thins kind of comparison. Thank you guys for the video, another great topic with a discussion entirely based in facts 🤯

[@erikc8284]

As a Spanish man living very close to you (in Karlsruhe, not even one hour from your Freiburg house) in Germany I wanna say I enjoyed the video a lot and I thank you for all the research and information you provide for free. With that said, I wanted to point out that for somebody like me, Germany is not really dense. Check the spanish case and you'll see much concentration there is in the big urban areas VS the rest of the land (90% of the total population living in 30% of the total land). Germany's population is very wide spread all over the country, which is something I like. I feel that Spain (as well as Japan, Australia or Korea) is a weird anomaly that should not happen. People concentration in high density areas is for me not the desired path, although there's a good side of that (less infrastructure to be created and less land to be destroyed by humans). Keep the great work.

[@gilliantracy7991]

Great and informative video. All the best from California!

[@BioD86]

I would have liked to see a bit of discussion why home ownership rates are so different between the countries despite the apparent difference in affordability. And it's not that people in Germany want to stay renters. There are many mechanisms that make it possible for people in the US to get into the housing market when still young. Good luck finding a bank in Germany granting a 30 year mortgage or a mortgage without at least 30% down payment. Because most mortgages are federally backed in the US (Freddie Mac) it's possible to get a mortgage with less or no down-payment, but higher interest rates and additional insurance. And in most cases even high prize mortgages are still comparable to local rents. Paying a mortgage means building wealth, paying rent is just money gone (yes I know, investing the down-payment can help equalize things, provided you have money left after paying rent). I paid close to $250,000 for rent during the past 15 years living in Germany, UK, France and the US as opportunity costs for building my career as scientist.

[@klausbeeblebrox64]

You have a Point in your last sentence. Renting instead of buying made it possible for you to move around so much, even between countries. I think this flexibility is one of the reasons why so many people Rent, especially in our current Job-Market, where many people have to move around a lot. In Germany you buy for life most of the times, partly because of the tax-structure.

[@WhatIsThis-zq4hk]

I feel pretty helpless in the US. I find myself regularly explaining the need for more density/housing units to conservative nimbys, and then later explaining supply and demand to left-leaning renters who think eating rich people is the solution. This problem will never be solved because only a very tiny amount of people know the real problem and have the will to fix it

[@WhatIsThis-zq4hk]

@@adas1988 rich people have the assets to invest in housing construction. Poor people do not. We need to stop limiting developers from building housing. Eating the rich does the opposite

[@WhatIsThis-zq4hk]

@@adas1988 rich people buy and hoard houses because they are scarce. They are scarce because of zoning laws restricting supply. If the government limited Apple to making only 10,000 iPhones per year, I would fully expect rich people to buy them up and hoard them as the value shot up. (People have already done this recently with graphics cards, PlayStations, and NFTs.) If people then came in and said “rich people are causing the iPhone shortage “, that would not be correct. yes, people are being greedy, but only because scarcity allows them to be. That’s exactly what you’re saying about the housing market. If rich people were prevented from buying up our limited housing supply, the prices might go down a little bit, but there would still be a housing shortage. The real solution in both scenarios is to allow Apple/real estate developers to build enough units to meet demand, which stabilizes prices an allows everyone to have a unit. That is exactly what Japan did, and they successfully fixed their housing crisis and now housing is very affordable in Japan because it is abundant.

[@KVPMD]

I am not so sure about other regions but in many East German cities still a big chunk is owned either by a city owned company or a "Genossenschaft". This is due to this 2 parts being the dominant economical forces in the GDR. For example in my city (230k inhabitants) it's about each 1/3 of all appartments (over all, not only rented ones) that are owned by the city (Wobau) or on of many local "Genossenschaft". They are both highly coorperative, have the well being of the city in mind and as the Genossenschaft means it's owned by the renters they also don't need to make a big profit. Both of them also keep building new ones, especially everywhere the city has an interest to fill holes. Private companies from the outside are growing but still they play a minor role. So at least here it's not small owners. But also only regional. This helps a lot.

[@NormanF62]

I rent for two reasons: the cost of buying a home is out of reach for me and I get a long term care public subsidy for renting my apartment. That’s makes it a no brainer for me to rent my place.

[@paulmckelvey3856]

In an article about homelessness, it was noted that Los Angeles had 20,000 people on the street. So they built 20,000 low income housing units. In the next decade, they had 40,000 homeless people. Tells me that there’s other drivers to homelessness that real estate.

[@robwilliams2410]

Fascinating. Looking forward to your next video on this topic. I’m sure that you have seen the Vox video about zoning.

[@TypeAshton]

Yes!! Also a great series.

[@Ditto787]

I've been saving up for a house like a very determined squirrel for well over a decade, and despite making on the low end of IT salaries (50-70k), living in an expensive area (Boston), I'm far from being able to buy a house/condo. Rent has skyrocketed this year with 5-10+% jumps, and that is making saving any money with stagnating salaries challenging. My income would have to increase significantly so as to not have to spend 40% of it on mortgage and HoA costs, or I'd have to purchase with another adult or three in order to be able to afford mortgage, even at a really good rate!

[@arnodobler1096]

17:45 omg 😭🤣

[@TypeAshton]

I knoooowwww. ☠️☠️☠️☠️

[@michaelkloters3454]

Hi ashton, as always - very well done video because of very well done research! but my question is a bit beside the topic and it`s not the first time i ask it: When do you sleep, or do you research by dreaming? all this - great topics, well done research and the improvement of filming or graphic skills can`t be done only by your dilligence! second question: can i have the recipe for the magic potion you seem to be using? Greetings from Hanover

[@TypeAshton]

Awe thanks. Since focusing on this channel full-time I finally have the time to also invest in trying to learn more graphics skills. Thankfully, this topic was also one that is in my "wheelhouse" so to say, so I was able to write the notes fairly quickly. ❤️

[@marenhuwald6395]

Almost all German houses have a basement, that can be used as living quarters if needed.

[@frauteacher]

When you talk about follow up videos, do you have a way that one can automatically get to them? That would be helpful because I find I am spending time searching for them. If they are organized in a sequence to have them numbered with the same title would be helpful, and then perhaps a subtitle for the content. Like Housing 1: Germany vs. USA (because the USA is not all of America) The Affordable Housing Crisis and then the next one would be Housing 2, because I am interested in following your series.

[@TypeAshton]

Hi there! - If you go into our content and organize by date, these videos should be shown to you in a sequence. However, as we continue expanding on this content, I will try to put together a playlist for viewing in the future.

[@donaldduck2621]

Hey, I like your channel and the topics you are talking about. Where in the US are you from ? I am an Austrian (= below Germany) and I am a 35-year old renter myself. To buy or build a house in Austria is virtually impossible for young people, unless you inherited half a million € in cash or if you build/buy it together with your girlfriend and have good-paying jobs. And this year, the material costs are up 20% or more too, making it even more expensive. So yeah, lots of young people either stay home until their 30s, or rent apartments. It's actually not bad and affordable and you are not wasting your money, especially in rural areas where rents are not this high and you got good quality of life. 👍

[@TypeAshton]

We are both from the Midwest USA - I am from south of Chicago and Jonathan from Kansas City.

[@donaldduck2621]

@@TypeAshton Cool. I have only visited the US East Coast in 2011 with a friend so far. Not Chicago, or Kansas City. Maybe in the future. But I know - as a geography nerd - that Kansas City is in both Missouri and Kansas. Basically on their borders. And it has a good football team (not soccer, as you Americans call the REAL football 😉, but NFL football).

[@patrickhanft]

I'm not a fiscal expert here in Germany and you are certainly right, that municipalities do have a huge incentive to create housing (and especially for cities, to get their inhabitants to register their "Erstwohnsitz" also there), but as you probably know, but haven't mentioned, the Gewerbesteuer also creates a big incentive to provide land for commercial purposes. From my point of view, while it is necessary to support businesses, I often have the impression that the commercial land use in Germany is the driving force for our kind of "suburbanisation" in the form of "building on the 'Grüne Wiese'", which normalises car dependency. Car dependency is still a big issue and drives the cost of infrastructure the municipalities need to build - and therefore the cost for the whole society. Higher density is also needed for more wealth in the cities and for lower environmental impact. The single family home is the most expensive and worst form of housing for the environment. Even here in Germany, it should be the exception in the future, not a part of normal housing politics. Removing the car from urban environments can lower the cost of buildings, as we can remove the cost of parking. And lowering incentives to drive by car from your single family home in the countryside to the city, could also lower housing costs there, as you might reduce from two or three cars in rural areas to having only one. But we need muuuuuch better public transport networks and even more "work from home" for that.

[@TypeAshton]

This is SUCH a great comment!! You are 100% right - Dependency on cars and the expansion of public transit is a significant part of this conversation. I would also love to see a more diverse approach to incentivize public transit or "green" options, both public and private. For example, Jonathan's employer gives all of their employees a bonus each month in "commuter points" - for every day they take a green-mode of transportation (public transit, walking, bicycling, etc.) they get points that they can then spend on products. Since he works for a cycling company, this means reduced prices on everything from bicycles to shoes and cycling kits.

[@donaldduck2621]

Question for Ashton: could you do a video next explaining to us Austrians and Swiss and Germans how the November elections work in the US and what to watch for ? Thanks. 👍

[@TypeAshton]

Yeah! I think that could be a great topic for a video in the future!

[@donaldduck2621]

@@TypeAshton Thanks ! I know that most Americans who are living abroad don't vote any longer in their original home elections. If I were living abroad for years, I probably wouldn't vote here in Austria as well any longer. Do you have any plans to vote in the USA election in November despite being in Germany ? And which states would that be ? I think I remember from the ancestor videos that you are from the Midwest (but not which states).

[@TypeAshton]

@@donaldduck2621 Jonathan and I still vote in the elections - however, because of work involved in getting the ballot and mailing it back in - we mostly just participate in the national elections and not so much in local elections. Since we don't own property in the US but we are required to have a "permanent" US address listed, both Jonathan and I just kept our passports tied to our respective parent's houses. So I (Ashton) vote in Illinois and Jonathan votes in Kansas.

[@donaldduck2621]

@@TypeAshton Thanks, I thought this would be the case with your vote being recorded in your previous home states - even if you are in Germany now. How long before election day must you request your ballot so it safely arrives in Illinois or Kansas to be counted ? Maybe you can explain this in the video then. Are there differences between the various states (I guess so) ? In President elections, neither Illinois nor Kansas are swing states, but are they in November ? I read today in the Austrian newspaper that the Illinois governor wants to ban assault rifles. I don't think Illinois is competitive, because Chicago is voting very Democratic. Kansas is very Republican, but has a Democratic governor. This will be close in November, right ?

[@Al69BfR]

To be honest, I personally thought China copying whole European cities (i.e. Hallstatt/Austria) is the worst thing I could imagine when it comes to city planning and architecture, but then I saw this picture of that building in Michigan that seems to shout out „Kill me!“. So dear Americans, when it comes to copying buildings either leave it to the Chinese or let Disney do the job. They made a much better version of Neuschwanstein than king Ludwig the second himself. 😉

[@LarsPW]

So despite of having - overall the USA - land enough and compared to Germany relatively cheap house construction habits, there is now a housing crisis like in Germany. In Germany it has been and still is more expensive to own your privately used home than to rent it. And that did not changed for decades so far. That could have changed for homes earning some money by producing photovoltaic electricity or at least saving money if it is less dependent on externally provided energy, but houses with flats might follow.

[@codex4046]

These graphics definitely add value to the video. And I can't wait to get into the zoning video.

[@TypeAshton]

Thank you so much!

[@weler1806]

A couple of years ago I saw an documentary about usa city's and why they have such a giant size, as I remember the reason was that the City build now houses to pay for the older suburbs wich are not profitable for them, as a result prices must go up because you need more expensive homes to pay for them.

[@PeTer-xd8nx]

I am always thrilled with the quality of your content and look forward to being so educationally entertained by you every Sunday. I would love to see a comparison of German and American taxes/cost of living. Thanks for the work you put in.

[@TypeAshton]

I think that could be a great idea for a future video series! Thanks!

[@David_Baxendale]

I don't think is just a US issue, here in germany property prices have been going up and up. Even cities that were relatively cheap like Berlin have seen prices explode. I can't see this changing as there is too much of a vested interest in keeping things the way they are. People that have already bought would see their investment (the property) drop if more property was to be built (this was called negative equity in the past), this (as mentioned in the video) reduces the investment of the people have bought property. Maybe more influential, lots of investment money is tied up in property being rented, this includes investment funds and people who invested in foreign property and either rent it or leave it empty (say as a holiday flat etc). Even where more property is being built, the price is not dropping. Either because building is being staged to keep demand high, or there is such demand that they cannot build enough in time. In germany there was a discussion about another factor, who pays for the infrastructure. Is it ok that a development company buys land on the edge of a city, builds a massive housing area and then leaves it to the city to deal with infrastrastructure (widening/improving roads, public transport etc). It seems unfair that a company makes all the profit and pass on this cost, but this cost would push the purchase price up or stop anything being built.

[@firstlast-cs6eg]

Should be more ownership than renting unless public housing. It's good the ownership is spread out among regular people in Germany, but I still see "renting" as a problem.

[@FabFunty]

That was a very informative presentation of this subject, Frau Dr. Haferkamp-Schottler😉

[@TypeAshton]

So glad you enjoyed it!

[@raman9756]

I bought an old apartment 15 years ago for about 90k € in a smaller city with about 550.000 citizens in a former industrial area of germany . so no fancy big city. the apartment prices in that area went through the roof and my apartments price would be about 210k€ now. And the statistics of my city show that in general a 100 square meter apartment in 2012 was worth 1.700€ per square meter - now in 2022 its 3.000€ per square meter.

[@RealConstructor]

I bought my first apartment of 90m2 for fl. 235,000 (€113,500) in 1991, which I sold in 2017 for €234,000. So more than doubled in 26 years. I bought a new apartment of 120m2 that year for €280,000, which I sold this year for €490,000. A gain of €210K in only 5 years! Madness! I could now buy a semi bungalow of 130m2 and I still have money for expanding it with 25m2, renew the kitchen, the bathroom, the toilet, get floor heating and tile flooring in the whole house, insulate the floor and the roof, take solar panels and prepare my house for a heatpump. I still got central heating on gas, but in a year or two I will get a heatpump. It is still too expensive to buy one now, even with the subsidy of €3,500 it still costs me €12,500. Prices are high at the moment because of the energy crises and labor shortages. I hope this will change in two years and prices will drop a bit (or I get used to the high purchase price). So in two years my home is future proof and energy low.

[@MartijnV452]

Are you familiar with the channel Not Just Bikes? It’s about a Canadian living in Amsterdam and he talkes a lot about zoning and the car dependent suburbs in North America. I love watching his video’s.

[@TypeAshton]

His channel is fantastic!

[@StrassenbahnBen]

Do you know the Genossenschaft-model? You're buying a share of a company that owns houses and then you rent one of the flats. So you're partially owning the company you're renting from. That means you get a say on the company's development.

[@johnkronz7562]

It’s not just about building, but who pays to build housing. Land Lords and rental firms will never build enough housing to bring down prices. So long as prices keep rising, they get profit for nothing.