Real Estate Analyst Sven Carstensen urges states to lower the real estate transfer tax, making construction more affordable.
“The state should recognize that it doesn’t collect the real estate transfer tax if nothing is sold” the CEO of the analysis and consulting firm Bulwiengesa told the ‘Redaktionsnetzwerk Deutschland’. The real estate transfer tax ranges from 3.5 to 6.5 percent of the purchase price, depending on the federal state. In the face of rising construction costs and high demand for housing, there have been more calls to lower the tax recently. However, for example, the Bremen Senate has just decided to increase the tax rate from 5 to 5.5 percent.
Carstensen also appealed to federal politics to reduce costs. The high state share of the construction costs makes it more expensive to build. The real estate expert also criticized the government’s subsidy policy, saying, “The abrupt end of the new construction subsidy at the beginning of the coalition’s term of office had many gnawing at it.” Looking at a new federal government, he said, “It would be good if there were a bit more security.”
2025 will be a big question mark as to which subsidies a new government will bring on the way. However, Carstensen observes a slight easing in the residential real estate market in some areas. “Some developers are holding it again possible to build, which is due to fallen land prices, more affordable technologies like modular construction, and also because the rents have risen a bit” the Bulwiengesa CEO said. “Therefore, I believe that the year 2025 won’t be so bad after all.