SCHWÄBISCH HALL (dpa-AFX) - In light of rising real estate prices, Mike Kammann, CEO of the building society Schwäbisch Hall, believes it is becoming increasingly challenging for people in Germany to move into their own four walls. 'Affordability is likely to become somewhat more difficult over the next five years,' Kammann told the Deutsche Presse-Agentur in Stuttgart.

Simply put, too little is being built in Germany. 'From my perspective, this naturally carries social explosive potential. Lifelong dreams are shattering,' Kammann said. Looking at the real estate market, he admitted to having 'a rather critical underlying sentiment.'

Who will still be able to afford their own home in the future? 'Many people who have wealthy parents, possess a significant inheritance, earn well or - very importantly - those who started saving early themselves,' he said.

Rise in Real Estate Prices Expected

Kammann anticipates a rise in real estate prices of two to three percent in the medium term, alongside a slight increase in interest rates. 'The higher the inflation expectations, the higher the interest rate will rise,' he noted. In contrast, he expressed a 'rather more pessimistic' view regarding real disposable income, given the current economic outlook.

'People want their own four walls,' Kammann said. To achieve this, however, they would have to save by sacrificing consumption, such as on holidays or lifestyle. The building society is also noticing that homebuilders are once again performing more of the work themselves. 'Without sacrificing consumption and putting savings aside, securing one's own home will become difficult,' Kammann stated.

According to the building society chief, it requires 'a bit of compromise, diligence, and a firm will to save, as well as the courage to build up equity, commit to mortgage financing - and thus debt - and take the leap into property ownership.'

Crisis in Residential Construction

In 2025, fewer apartments were completed in Germany than at any time in more than a decade. The 206,600 units built represented an 18 percent decline, or 45,400 apartments, compared to the previous year, as reported by the Federal Statistical Office in May. The number of single-family houses built fell particularly sharply in 2025, dropping by nearly a quarter to 41,800.

Last year, residential property prices in Germany increased by 3.2 percent compared to 2024, according to the Federal Statistical Office. This marked the first increase in three years, following a period of sometimes significant price declines.