Living with Social Value:
Good Arguments for Residential Properties

How social are your resi­den­tial prop­er­ties? It’s a legit­i­mate ques­tion — after all, hous­ing is high­ly rele­vant to soci­ety. The impor­tance increas­es notice­ably when there is a lack of suffi­cient living space. Never­the­less, it is often unclear which crite­ria can be used to deter­mine the social value of hous­ing. A study by Price­wa­ter­house­C­oop­ers (PwC) in collab­o­ra­tion with the Bundesver­band deutsch­er Wohnungs- und Immo­bilienun­ternehmen e. V. (Feder­al Asso­ci­a­tion of German Hous­ing and Prop­er­ty Compa­nies) provides answers. In today’s Valdivia expert tip, we present the most impor­tant results — and thus good argu­ments for market­ing your newly built or refur­bished prop­er­ties as social­ly sustainable.

Social sustain­abil­i­ty in resi­den­tial property
The ques­tion of the social value of hous­ing has not only arisen since the Unit­ed Nations set social sustain­abil­i­ty goals. The PwC study shows that the major­i­ty of compa­nies surveyed have long consid­ered social factors. This applies to construc­tion measures, rental price calcu­la­tions, and purchase and sale deci­sions. Howev­er, clear crite­ria that would enable this social value to be deter­mined in terms of sustain­able prop­er­ty qual­i­ty, and thus make it possi­ble to argue for it, are bare­ly known or missing..

The study first analy­ses which of the 17 UN Sustain­able Devel­op­ment Goals can be applied direct­ly or indi­rect­ly to the social factors of housing:

• Afford­able, secure housing
  is expressed in “no pover­ty” (1) and “fewer inequal­i­ties” (10).
• Qual­i­ty of 
  The qual­i­ty of life, e.g. through green spaces around the house or on roofs, is reflect­ed in “Health and well-being” (3) and “Life on land” (15).
• Social compat­i­bil­i­ty
  is includ­ed in “Sustain­able design of cities and commu­ni­ties” (11). We have already present­ed one aspect, Farm­ing 2.0 for construc­tion projects, in the Newsroom.
• Sustain­able infrastructure
  e.g. mobil­i­ty (bicy­cle friend­li­ness, public trans­port access) and waste dispos­al results from “Sustain­abil­i­ty in consump­tion and produc­tion” (12).

24 Factors for the social hous­ing value

In the next step, the PwC study derives 24 indi­vid­ual factors in five cate­gories from the UN goals that contribute to social hous­ing value. The study also analy­ses the weight­ing assigned to each of these factors by the 18 hous­ing compa­nies surveyed:

1 — Rent amount

Surpris­ing­ly, a “cold rent below the market aver­age” only achieves an aver­age value of 50% for “impor­tant” or “very impor­tant” (also summarised below)

2 — Neigh­bour­hood quality

The results in the second cate­go­ry vary. For exam­ple, respon­dents rated a parcel pick-up station as hard­ly rele­vant (11%); fast-charg­ing stations (34%) and care centres (22%) were not consid­ered to be of any great impor­tance either. Child­care facil­i­ties (50%), espe­cial­ly for chil­dren, and above all green and open spaces in the neigh­bour­hood (55%) appear to be more important.

3 — Community

This cate­go­ry includes two factors repre­sent­ing the social inte­gra­tion of resi­dents in the neigh­bour­hood: Offers for joint events were rated lower (34%). Converse­ly, areas suit­able for all gener­a­tions (50%), includ­ing children’s play­grounds, foot­ball pitch­es and boules facil­i­ties, are of greater inter­est — as are commu­ni­ty gardens and small cater­ing estab­lish­ments, which were not mentioned in the study, as social meet­ing places.

4 — Qual­i­ty of living

It is obvi­ous that this cate­go­ry includes most of the indi­vid­ual factors; they are list­ed here accord­ing to their weighting:

• Barri­er-free access to the prop­er­ty (83 %)
• Suffi­cient number of bicy­cle park­ing spaces (72 %)
• Suffi­cient number of park­ing spaces for pushchairs (72%)
• Low-barri­er rental space (61 %)
• Private­ly usable outdoor areas (61 %)
• Shared green spaces (56 %)
• User-friend­ly facil­i­ties for waste collec­tion and sepa­ra­tion (55%)
• Adequate number of park­ing spaces for wheel­chairs and walk­ing frames (50 %)
• Aesthet­ic design in public areas (34 %)
• Attrac­tive design of the stair­wells (28 %)

It should be noted that the last two points are primar­i­ly a matter of taste. We there­fore view their low weight­ing with caution: it has been shown too often, espe­cial­ly in older large resi­den­tial complex­es, that a less appeal­ing design can very well contribute to a signif­i­cant reduc­tion in social quality.

5 — Security 

Over­all, this cate­go­ry has only recent­ly been prop­er­ly recog­nised. For exam­ple, the oblig­a­tion to install smoke alarms has only been in place for a good ten years; smart tech­nolo­gies are still the excep­tion in private resi­den­tial build­ings. The study lists six indi­vid­ual factors:

• Burglar-resis­tant flat doors (67 %)
• Compre­hen­sive outdoor light­ing (50 %)
• Visi­ble entrances and flat doors (45 %)
• Mail­box­es to be loaded from the outside, emptied from the inside (39 %)
• Door inter­coms with or with­out camera (39 %)
• Smart living elements (28 %)

Howev­er, given the low rank­ing of smart living elements, it should be borne in mind that the rele­vant tech­nolo­gies are devel­op­ing rapid­ly. For exam­ple, AI-support­ed assis­tance systems for senior citi­zens could become signif­i­cant­ly more impor­tant in the near future.

Social score with high benefits

The results of the PwC study enable well-found­ed conclu­sions to be drawn about the extent to which a prop­er­ty achieves social sustain­abil­i­ty. This enables compar­a­tive values to be deter­mined for prop­er­ty plan­ning or purchas­es, a risk score to be calcu­lat­ed, and veri­fi­able qual­i­ty state­ments to be made for commu­ni­ca­tion purpos­es. This also applies, for exam­ple, if you are consid­er­ing convert­ing office space into resi­den­tial space. Here, a social score can make your deci­sions easi­er and subse­quent­ly help to convince investors or the public.

Sources

1. “Hous­ing — the new social issue?” — IW-Analy­ses 136, Research reports from the German Econom­ic Insti­tute, 2020
2. “Major­i­ty satis­fied with hous­ing situ­a­tion, but cramped living condi­tions for fami­lies” — DIW Wochen­bericht 41, Deutsches Insti­tut für Wirtschafts­forschung e. V., Octo­ber 2024
3. “Social value in the hous­ing indus­try” — Price­wa­ter­house­C­oop­ers GmbH, June 2023

(Image source: istockphotos)