Affordable housing is increasingly becoming a problem in Saxony

Affordable housing is also becoming increasingly difficult to find in Saxony. The housing industry is facing the challenge of managing socially acceptable rents while investing and achieving rising climate targets, explained the Association of Saxon Housing Cooperatives (VSWG) and the Association of the Housing and Real Estate Industry (vdw) in Dresden. Both associations presented their annual balance sheet (2025) together for the first time. Many of the key figures are similar.

Investments mainly in maintenance and modernization

The 199 cooperatives organized in the VSWG invested 623.4 million euros in the previous year, two percent more than in 2024. The focus was on maintenance (371.5 million euros) and modernization (209.4 million euros) of the portfolio. New construction stagnated at 42.5 million euros - only 176 new apartments were built. "Although construction prices are rising more slowly than in previous years, higher investments are leading to ever lower construction output in real terms," said VSWG board member Mirjam Philipp.

Bad times for new construction

The 117 housing companies in the vdw invested €703.6 million in 2026 - almost 11% more than in the previous year. Here, too, the money was mainly spent on maintenance (297.3 million euros) and modernization (284.7 million euros). 762 new apartments were built (2024: 719). "We expect a dramatic slump in new construction this year and in the coming years," emphasized vdw CEO Alexander Müller. The companies' forecasts are "very gloomy".

Vacancy leads to considerable loss of income

The two associations also have similar problems in other areas, such as vacancy. Around 24,000 apartments, or 8.2 percent of the housing stock, were vacant at the cooperatives. At the municipal companies, 9.5 percent of all apartments - more than 25,300 - were unable to find a new tenant. This is associated with enormous costs. The VSWG alone lost out on income of 94 million euros - 68 million in potential rental income, the rest in operating costs that could not be allocated.

Increase in operating costs is a particular cause for concern

In terms of rents, the cooperatives and municipal housing companies are still in the green - at least from the perspective of many tenants. This is because the net cold rent last year was EUR 5.75 per square meter (VSWG) and EUR 5.66 per square meter (vdw), up 13 cents and 16 cents respectively on the previous year. The so-called second rent - hot and cold operating costs - is increasingly becoming a burden factor, it said.

Associations anticipate rising rental costs

Philipp and Müller did not want to commit to figures with regard to rising rental costs. That would mean looking into a crystal ball. "In my view, it will become significantly more expensive," said Müller. Philipp illustrated this with the development over the past year. Overall, housing costs have risen by 27 cents, which corresponds to 3.1 percent. "I think that's now a figure that can be continued." This means that the gross warm rent currently stands at 8.92 euros.

According to Philipp, the VSWG is encouraging its members to increase rents moderately. Sometimes the prices per square meter are as low as three euros. Some have not increased their rents for 30 years out of sheer consideration. "We stand for affordable housing, but we also stand for the fact that we have to keep our properties modern and invest accordingly."