'Grotesque misallocation' of housing

A study by the Raiffeisen bank is suggesting the current housing crisis is being caused by pensioners living in apartments that are far to big for them – and the rental law is to blame.

The bank says it’s a ‘grotesque misallocation’. 

Older people, tend to stay in the home they’ve lived in with a family. But when the children leave, they have more space than they need. But as their rent can’t rise too high on the same contract, they end up with a bargain and moving to a smaller place would probably cost them more. 

Those aged 45 or over make up nearly half the population – but only account for about a quarter of house moves. 

The study showed if older people moved to an apartment more suited to their needs – it would free up space for a further 450,000 people.

The bank concludes the problem is only going to get worse with an aging population, increasing immigration and limited construction.

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