Houses, like other goods, decrease in value over time. A new house should be significantly more expensive than a 50 year old house - just like a car.
I was picking the absolute lowest cost for an example, so on one hand it should have.
On the other hand, what's that in "years of average income", and does it seem reasonable that half of this is the land itself?
I know that the salaries in Berlin are in the lower end, but 100k EUR a year in household income seems like a reasonable expectation for people wanting to live in attractive areas.
But even if the median income were €100k, the €400k level was around the cheapest I could find that you could actually live in and wasn't a weekend house, or a reverse-mortgage you'd only get to use when the seller died, or a building opportunity with no land, or they're rented out and as Germany has fantastic protection for tenants you are not going to move in etc.
If the standard is 4 years, even then you'd be excluding 50% of the households from ownership at €100k/year and €400k minimum prices. As is, €43k/year is closer to 9.5 years income still not being enough for 50% of households.
Not everyone gets to live the most popular places.
> The median pre-tax household income in Berlin is €43,572
Seems like Germany can not afford to not allow mothers into the work place.
Edit: At a median household income of EUR 43k the issue is not housing prices. in Denmark the median salary (not household) is 73.000 EUR a year. I think Germans need to negotiate their salaries.
Definitionally, everyone who actually lives in a place must be able to afford that place. If people suddenly can't, they leave, it's now less popular.
Right now, it's rent controls which allow most Berliners to live in Berlin. Without that, many would be forced to leave, making the city less popular, and thus less expensive.
(Perverse incentives, yay!)
> Edit: At a median household income of EUR 43k the issue is not housing prices. in Denmark the median salary (not household) is 73.000 EUR a year. I think Germans need to negotiate their salaries.
Negotiate with whom? Where would the extra money come from? https://www.wolframalpha.com/input?i=germany+gdp+per+capita+...
Making a country richer isn't as easy as printing more money. They tried that, it didn't end well.
Anecdotally, Tesla Berlin pays in the range 50-60k/year in Berlin (for SWE roles) - I am quite sure they are able to pay muuuch more.
So either are workers in Berlin less than half as effective as Tesla's other offices or Berliners accepts a much lower pay.
GDP is a number - If the Berliner kebab was priced at 12 EUR instead of 6 EUR, then they could afford paying double the salary - The rest of the world is about to add zeroes to everything. Why wouldn't Berlin?
My thinking is that this is Europeans focussing on "budget rather than profitting".
And then the houses and the land also double, or house builder's salaries real term wages halve and the workers leave and stop building stuff. Land prices are harder to draw conclusions about, but the owners have to want to sell at the price being asked, which is ultimately what the market will bear.
> The rest of the world is about to add zeroes to everything. Why wouldn't Berlin?
Fear:
https://en.wikipedia.org/wiki/Hyperinflation_in_the_Weimar_R...
This is roughly 1/3 of the Danish household income. If I were German I would riot for higher salaries - we simply can not accept such disparities in a modern world with movement of labor and remote work.
It seems like German fear is what forces the ECB to lower the interest rates causing severe asset price inflation in Denmark.
Please - negotiate your salaries in Germany.
IMO it's yet another network effect caused by fewer people being willing to work in these kinds of fields, and a decreasing birth rate. Infrastructure inherently requires maintenance, so as it increases, so does the amount of people required to maintain it. Yet we have fewer and fewer people to do it, so adding new stuff just becomes unreasonably expensive.
I've been looking at getting a house built, and that starts at about €200k*, but the land in Berlin is at least another €200k on top of that (and usually more).
If I was willing to live in the back end of nowhere, I can get the land for almost nothing, halving the total cost.
But then I'd be living in the back end of nowhere, and turning that into an interesting town (let alone city) would need some very expensive infrastructure to be built, just to support that many residents.
Make the infrastructure cheap, and you can build New Towns.
Most of the developed world seems to struggle with infrastructure during my lifetime, be it major roads, railways, sewage, electricity networks, or anything else.
* list price €100k but that's a cheat as it's the outer shell only, no plumbing or interior plastering