Residential construction - State housing association invests in new construction
In the local housing company Nassauische Heimstadt, it is reportedly planned to add around 700 new housing units this year. For the next few years, the "cooker is still full," said Monika Fontaine-Kretschmer, the technical managing director in Wiesbaden, referring to building projects in Frankfurt and Darmstadt. By 2027, there are expected to be numbers exceeding 500, up to 1,000 completions per year. However, after that, resources from a specific state funding pot will have been exhausted, so one must look at what lies ahead after 2028, "what is indicated."
Last year, the number of homes in the Nassauische Heimstadt/Wohnstadt (NHW) group surpassed 60,000 for the first time, of which 550 were completed. Fontaine-Kretschmer explained this during the 2023 annual report. Currently, the NHW group is still in a growth phase in terms of new construction – contrary to industry trends – because it has brought many projects into planning and implementation by 2022. There are currently 3,100 housing units under construction and in planning.
Affordable Rent
With an average gross cold rent of €6.66 per square meter, the NHW ranks among the most affordable providers of living space nationwide, according to the Supervisory Board Chairman, Hesse's Economic Minister Kaweh Mansoori (SPD). Even in regions with high demand and tight markets, rents are significantly below the market average. According to statistics from the Hessian Statistics Office, the gross cold rent in Hesse averaged €9.30 in 2022. The NHW offers rental housing at 113 locations in Hesse. Around 30% of these are subsidized housing.
Considering the financially strained situation in many households, Mansoori asked the NHW management in February to postpone rent increases for the time being. Discussions are ongoing for a new rent strategy. The goal is for the NHW to remain a pioneering provider of housing, but also to have room for further investments, Mansoori explained. Balancing both, however, is not easy. "At the end of the day, the Nassauische Heimstadt is a social housing company, but it is also a housing company." Thomas Hain, the managing director of the NHW, said the company saw itself as a social landlord and wanted to remain so.
Self-employed Handyman Service Founded
The rental business is running "like a loaf of bread being cut," said NHW managing director Constantin Westphal. More than 400 apartments were rented out quickly in Frankfurt, Hanau, and Wiesbaden. The sale of owner-occupied apartments, on the other hand, is coming back slowly and at a low level. "We have reacted to the subdued demand with price reductions of up to eight percent."
The difficult search for craftsmen led to the establishment of a craftsmen service, explained Westphal. There are currently 76 employees, including painters, carpenters, electricians, and tile layers. We hope for an efficiency increase through the use of foremen. "We will allow our craftsmen to keep their transporters at home," said Westphal. In addition, we will train ourselves to achieve healthy growth. The NHW has learned in the past three years that it becomes increasingly difficult towards the end of the year to quickly put vacant apartments in order to be able to rent them out again.
- The new building projects in Wiesbaden, as part of the Nassauische Heimstadt's plans, will contribute to the addition of new housing units this year.
- Despite the completion of around 550 housing units in Wiesbaden last year, the NHW group continues to focus on residential construction in cities like Frankfurt and Darmstadt.
- In Darmstadt, the housing association Nassauische Heimstadt is part of a larger housing group that offers affordable rental housing at 113 locations across Hesse, with around 30% being subsidized housing.
- To address the growing demand for housing and the financial challenges faced by many households, the NHW is in discussions for a new rent strategy, aiming to balance affordability and further investments in living units.
