Challenges / Risks

Challenges posed by demographic change and changing customer expectations

 

As a result of demographic change, the German residential construction market faces a massive demand for further development and the development of integral overall strategies to meet the changing needs of the customers (65+) and counter the risk of higher levels of empty stock in the medium term

  • Demographic changes is changing the property market clientèle dramatically.
  • The number of over 65 year-olds is set to increase to 22.3 million or 29 percent of the overall population by 2030 (2012: 20.7 %).
  • The number of people requiring intensive treatment will rise by 40 % (+380,000) to 1.2 million in 2030.
  • The number of people requiring care currently being looked after by relatives or community carers will increase by 400,000 to 2.2. million by 2030.
  • The trend towards age-appropriate living formats such as sheltered accommodation and inpatient care will increase at a disproportionately high level.
  • Only 5 % of the flats currently inhabited by the 65+ generation are fully accessible.
  • There is a need for 2.5 million accessible / modified apartments, costing around 39 billion euros.
  • In the regions which are weaker in economic terms, there is also a shift in the age pyramid as those in employment are moving towards the stronger regions and cities and will no longer be available as clientèle (tenants).

 

Risks

 

If the residential market does not consider the needs of clientèle requiring care on a more consistent basis (accessibility, integration of services), this could mean a departure of this clientèle in the medium to long term and lead to high levels of empty stock in the traditional property rental market.

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