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IW Köln: Too much new housing in rural areas

There is clearly too much new housing construction in rural areas while large cities are suffering from a severe housing shortage. This was revealed in a needs analysis conducted by the Cologne Institute for Economic Research (IW Köln). Researchers are cautioning about urban sprawl and losses for builders. In rural areas, an average of 20 % more units were built than needed between 2011 and 2015. For single family homes that number is twice that. One example is the Emsland region, where 1,060 more units were built than were needed. But too many homes were built in the south of Germany and in many other regions as well. In the seven largest cities, by contrast, only 32 % of the units needed were actually built from 2011 to 2015. To stem this development, communities should not release any more construction lots and make new construction contingent on demolition of old houses, the IW recommends.

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