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Germany’s Apartments Are Set to Shrink as DIW Flags Market Shift

The institute cites smaller households as the main driver.

Overview

  • After decades of growth to roughly 94 m² per dwelling and 49 m² per person, DIW reports that average sizes have stopped increasing.
  • New homes have trended smaller since about 2005, with the average dwelling projected to drop by around six square meters to about 88.5 m² by 2050.
  • One-person households now make up about 41% nationwide, reaching roughly half of households in cities such as Berlin and Munich.
  • Sharp property price increases since 2010 have put larger homes out of reach for many, while smaller units deliver higher per‑square‑meter returns to developers.
  • DIW finds an undersupply of small flats—less than 30% of the stock—and urges converting oversized dwellings and emphasizing compact, energy‑efficient designs.