Melbourne and Berlin Deepen Exchange on Affordable Housing and Social Cohesion

Representatives from the cities of Melbourne and Berlin met through the IURC Affordable Housing & Social Cohesion Community of Practice (COP) for two interactive exchange sessions focused on housing affordability, urban inclusion, and community wellbeing. The meetings, held on 30 April and 8 May 2026, created a valuable platform for both cities to compare policy approaches, share local experiences, and discuss the growing pressures facing global cities.

The first session centred on Berlin’s housing context and policy framework. Representatives from Berlin’s Senate Department for Urban Development, Building and Housing presented an overview of the city’s housing market, where 3.78 million people currently live across more than 2 million apartments. Berlin’s housing model is strongly rental-based, with 85% of apartments rented rather than owner-occupied, and more than half of all households consisting of single-person households.

Participants discussed the increasing pressure on Berlin’s housing market as the city’s population is expected to grow to around 4 million inhabitants by 2040. To meet demand, Berlin estimates that 222,000 new apartments will need to be built by 2040, with a target of delivering 20,000 apartments annually between 2022 and 2026.

The Berlin team also outlined how housing costs have risen significantly over the past decade, driven by population growth, international migration, rising land values, and construction costs. Between 2014 and 2024, offered rents increased substantially while purchase prices for newly built apartments more than doubled.

To address these pressures, Berlin has implemented a broad set of housing policy instruments, including local reference rents, rent brakes limiting rents for new contracts, caps on rent increases for existing tenants, and tenant protection measures linked to condominium conversion. The city also provides free tenant counselling and rent inspection services to support residents navigating the rental market.

The presentation further highlighted Berlin’s extensive social housing system and subsidy programmes. The city reintroduced construction subsidies in 2014 and now supports affordable housing delivery through interest-free public loans, grants, cooperative housing programmes, and municipal housing companies. In 2026 alone, Berlin’s social housing programme is expected to reach €1.3 billion in funding.

Municipal housing companies were presented as a central pillar of Berlin’s housing strategy. Six municipal companies currently manage approximately 378,000 apartments, representing more than one-fifth of the city’s rental housing market, while also contributing to neighbourhood stabilisation, social infrastructure, and housing affordability.

Second Session: Melbourne’s housing and social cohesion strategies

On 8th May 2026, representatives from the City of Melbourne outlined the city’s rapidly changing housing landscape, where high-density living and renting dominate the municipality. Melbourne currently has an estimated population of 189,381 residents, with 63% of households renting and 85% of housing classified as high-density development.

The Melbourne presentation highlighted the scale of housing affordability challenges facing the city. Median apartment rents have reached approximately AUD $620 per week, while nearly 14,000 rental households are experiencing housing stress. The city also faces a projected affordable housing shortfall of more than 23,000 dwellings by 2036.

Participants also explored Melbourne’s planning and housing delivery context, including the Victorian Government’s target of delivering 2.24 million new homes statewide by 2051, with the City of Melbourne expected to accommodate an additional 119,500 dwellings over the same period.

Melbourne representatives shared several innovative housing initiatives designed to support vulnerable residents and increase affordable housing supply. This included “Make Room”, a specialist supportive housing project completed in 2024 that delivers 50 self-contained apartments with wraparound support services for people experiencing chronic homelessness.

The City of Melbourne also showcased the Queen Victoria Market (QVM) Munro Development, a major mixed-use redevelopment project combining affordable housing, build-to-rent apartments, community facilities, retail space, and a public library. The development includes 49 affordable housing dwellings and 490 build-to-rent apartments delivered in partnership with the private sector and community housing organisations.

Additional discussions focused on Melbourne’s growing build-to-rent sector, student accommodation market, and the impact of short-stay rental accommodation on housing supply. Melbourne currently has an estimated 4,100 short-stay dwellings, representing approximately 14% of all residential dwellings within the municipality.

The social cohesion component of the exchange explored Melbourne’s Inclusive Melbourne Strategy and neighbourhood-based engagement model. The City of Melbourne described social cohesion as a combination of belonging, trust, participation, inclusion, and shared responsibility across diverse communities. Participants discussed key challenges, including social inequality, rising living costs, loneliness, digital media influences, and declining trust in institutions.

Melbourne representatives also presented their Neighbourhood Model, which strengthens local engagement through neighbourhood partnerships, community grants, and place-based planning frameworks designed to better respond to the needs of individual communities.

The exchange generated active discussion between both cities on issues including housing affordability, migration pressures, social infrastructure, rental market regulation, construction costs, and the role of local governments in shaping inclusive communities. Participants agreed to continue the dialogue through future Community of Practice sessions ahead of upcoming study visits, reinforcing the value of international city-to-city cooperation in tackling complex urban challenges.