Housing in Small Towns

Housing in small towns is a blind spot in social and political debates. To date, both public and academic attention has focused heavily on large cities and metropolitan areas, even though approximately 30 percent of Germany’s population lives in small towns. They thus play a key role in the provision of equitable living conditions and sustainable spatial development. Nevertheless, due to limited data availability and a lack of empirical research, there aresignificant knowledge gaps concerning housing market structures and trends, and a lack of understanding of the housing needs and housing practices of different social groups.

Generalized notions that small towns have sufficient affordable housing or could serve as buffers for large cities are insufficient. Small towns are highly heterogeneous: they differ considerably in terms of location, functional integration, economic development, housing stock and social structures. Their corresponding housing policies are equally diverse.

Based on current research and social trends, this position paper identifies four key problem areas:

1. Small-town housing supply focuses on a limited number of housing forms and is struggling to meet increasingly diverse needs.
2. Small-town housing markets, which are dominated by homeownership, are at odds with the growing demand for rental housing.
3. Inner development as a guiding principle is being challenged by the continued designation of building land on the outskirts of towns.
4. Efforts to respond to the urgent need for action are constrained by a lack of human and financial resources at the local level, as well as by a general lack of awareness of the need for an active municipal housing market policy.

Solid empirical knowledge is required for effective policy and practice advice. Future research should therefore focus on the following:

• Systematic and comparative analyses of small-town housing markets, particularly regarding supply and ownership structures, rental markets and patterns of segregation, and the housing needs and practices of different age and social groups;
• Empirical studies of typical local constellations in small towns to better understand local housing market dynamics and thus to develop differentiated and specific policy approaches for housing and urban development; 
• Providing a practical knowledge base for municipal action, for example regarding instruments for revitalizing housing stock and inner development, municipal land and building policies, and governance and funding structures under conditions of scarce resources.

As many smaller municipalities have limited human and financial resources, developing practical and applicable tools for urban development and planning is particularly important. Comparative analyses and pilot projects can help to identify effective approaches and allow them to be adapted to different small-town contexts.

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