Consumer protectors and insolvency law experts are watching the rising rents, especially in metropolitan areas, with concern. "The burden of rental costs represents a growing risk of overindebtedness," warned Christoph Zerhusen of the North Rhine-Westphalia consumer advice center.
The rent should actually be no more than one-third of net income. "But we see more and more often that it makes up 50 percent and sometimes even more. This is very worrying."
According to data from the Federal Statistical Office on Monday, two out of ten over-indebted consumers in Germany who sought help from a debt counseling center last year had rent debts. The proportion has remained largely constant since 2015. But it is precisely in conurbations that more consumers could get into payment difficulties.
In large cities, there is currently no end in sight to the rise in rents, Zerhusen said. He appealed to those affected to take advantage of one of the numerous counseling options as early as possible in the case of rent debts. "Housing is existential."
Christoph Niering, chairman of the Professional Association of Insolvency Administrators in Germany (VID), also observes "that rental debts are playing an increasingly important role in conurbations". If price increases continue, the problem is likely to worsen. If, in addition, the economy cools down significantly and unemployment rises, the situation for those affected will be even more difficult. "If the rental market reacts significantly at all to an economic slowdown, it only does so with delays," Niering explained.
According to data from the Federal Statistical Office, rent debts are much more widespread in eastern Germany than in the west. Because of arrears for housing, almost one in three over-indebted people (31 percent) in the east sought help from a debt counseling service in 2018. In the western states, that was just under one in five (18 percent). However, unemployment is also higher in eastern Germany than in the west. In May, the rate in the east was 6.3 percent, in the old states 4.6 percent.
Citizens in the east also have higher levels of rent debt, according to data from the authority. At an average of 1147 euros, outstanding payments for housing were higher there than in western Germany (786 euros). On average across Germany, over-indebted German citizens were just under 1.8 months’ rent in arrears in 2018. That was 3 percent of the total debt of just over 29,000 euros.
Niering and Zerhusen see differences in development primarily between structurally weak and strong regions.