In the course of the refugee crisis the accommodation of incoming migrants and the implications for building activity have increasingly attracted the attention of the public, policymakers and, not least, the construction industry. At the same time, the housing market has faced increasing pressure on prices and rents due to building activity that in recent years has lagged behind the growing need for homes. Despite the high importance of these problems, reliable information concerning the demand side of housing has been lacking. Based on the IW Construction Demand Model , this study attempts to close this gap by estimating the additional housing demand until 2020 depending on certain scenarios as to patterns of migration. While one scenario reflects the rather high immigration expectations of the government, the other assumes a halt to inward migration in 2017. We combine the two scenarios to derive a range of possible demand figures with certain thresholds.

The first scenario leads to an average annual construction demand until 2020 of 380,000 homes while the second suggests that demand will be approximately 20 percent lower (310,300 homes). The additional annual average housing demand to accommodate incoming refugees ranges from 158,000 to 67.800 homes depending on the scenario. In a further section of this study we break this demand down by region according to the Königsteiner Schlüssel, a longstanding agreement between the federal and state governments on the sharing of financial burdens which is the current distribution regime for refugees. This allows us to derive implications for the different regional levels and types of agglomeration.

There nevertheless remains a high degree of uncertainty concerning future developments and these results must therefore be seen as only a first indication of how demand could evolve over time in line with the flow of refugees.