DIP partner Aengevelt Immobilien predicts that the supply of low-cost rental apartments will continue to decline because the political framework conditions set for this purpose continue to impair renting instead of promoting it. According to analyses by Aengevelt Rechearch, up to three million rental apartments can be lost due to a shortage of supply because private small landlords leave their apartments empty (for a longer period of time), convert them into second or holiday apartments, misuse them or sell them to owner-occupiers.
On 28 May 2026, Kai Warnecke, chairman of the owners’ association Haus & Grund, complained that political regulations, most recently the planned amendment to the Heating Act, continue to make renting out apartments increasingly unattractive. Warnecke literally: “We will therefore not be able to recommend many landlords to continue renting out their apartments.” Warnecke explained that up to three million rental apartments could fall out of rent. Against this background, the chairwoman of the German Social Association, Michaela Engelmeier, reiterated the fear that millions of rental apartments could be lost, so that the housing shortage in cities with low supply would further exacerbate.
According to the results of the 2022 census, 64% of the approximately 25 million rental apartments in Germany are provided by around 5.5 million private small landlords. According to surveys by the Socio-Economic Panel, private small landlords generate an average annual net rental income of around 5,500 euros, so that these districts only generate ancillary income from renting out apartments.
Aengevelt Research analyzed named comments posted by private small landlords in response to the coverage of the topic on various social media (Focus Online, Facebook, X) and summarized the results as follows:
- Private small landlords often rent out cheap apartments in old buildings at rents that are often well below the rent index level.
- Taking into account maintenance and modernization expenses and other costs, only minor surpluses are usually achieved.
- A large proportion of landlords confirm that renting is becoming increasingly unattractive due to legal regulations. Above all, the ongoing tightening of tenancy law, which is perceived as “de facto expropriation”, the increasing risk of loss of rent, the distribution of the CO2 levy, the regulations of the Heating Act or the planned amendment as well as the stress associated with tenant changes and new apartment rentals are mentioned.
- In particular, many private landlords do not see themselves in a position to renovate their apartments to make them more energy-efficient and to convert their heating to heat pumps for financial reasons in view of increases in material costs and interest rate increases.
- Dissatisfied landlord groups react to this with different strategies: Some sell their apartments to tenants, some to investors (who usually increase rents), some convert them into second homes or holiday apartments, some simply leave them empty for a longer period of time.
- Sales are also considered attractive because the proceeds from the sale can very often be invested in other investments at higher returns and with significantly less effort. In addition, the sale of up to three condominiums within five years is tax-free, provided that the statutory holding period of ten years has expired.
Dr. Wulff Aengevelt, Managing Partner of Aengevelt Immobilien: “The housing policy of the federal governments of the recent legislative periods achieves exactly the opposite of what it should be striving for: The supply of affordable rental apartments is reduced because the constantly tightening regulations mean that millions of low-cost apartments are gradually being taken out of rent. The rent-driving process, with private landlord groups gradually withdrawing from the rental cycle, has been underway for many years.”
