S4-4 – Taking Action on Material Impacts on Consumers and End-Users and Approaches to Mitigating Material Risks and Pursuing Material Opportunities Related to Consumers and End-Users, and Effectiveness of Those Actions
Since all of the measures that are outlined below are part of a continuous process, there is generally no specific timeline for their completion, unless a timeline has been defined for individual measures.
Actions for Affordable Homes that Meet Tenants’ Needs
In order to implement our policy of providing affordable homes that meet tenants’ needs for as many people in society as possible, we take the following actions with regard to the impacts that have been classified as material:
As regards housing affordability, we focus on fair rent pricing. Our rental prices are based on local rent prices, and, if available, on certified rent indices. Our involvement in rent index commissions, including providing data, in numerous locations helps ensure their accuracy and fairness. We monitor compliance with all applicable regulatory frameworks through our central rental management team.
Across the Group, the average rent price came to € 8.38/m² (2024: € 8.01/m²) in the 2025 fiscal year, and in Germany to € 8.19/m² (2024: € 7.89/m²), which corresponds to an organic increase in rent of 4.1% (2024: 4.1%).
Index-linked rents, i.e., rents linked to inflation, make up just around 2% of our lease agreements. The average rent excluding ancillary expenses in our portfolio remains below 30% of the average disposable household income of tenant households in Germany.
In Germany, the costs of energy-related refurbishments can be passed on in the net rent – within a specific framework. The government has limited companies’ ability to pass on costs to € 3/m² (€ 2 in the case of rents under € 7/m²). The resulting increase in the rent is balanced out for customers through a reduction in heating costs. When passing on refurbishment costs, we are always mindful to ensure that the burden placed on our customers is socially just and offer individual solutions as part of our social management system. That said, reasonable compromises must be made in favor of additional climate change mitigation measures. In the 2025 fiscal year, an average of € 0.75/m² in refurbishment costs was passed on (2024: € 1.25/m²).
We also offer publicly funded housing. Our business model ensures that we are always integrated into the urban society where we offer homes. In numerous cities and municipalities, we also offer subsidized and independently financed homes for people on low incomes – in Germany around 27,000 (2024: 33,700) of our homes are currently price-controlled – and are responding to specific challenges with services tailored to local needs.
The supplementary voluntary agreements that we conclude with cities and municipalities include, for example, provisions governing fair rental conditions, the construction of new apartments or the strengthening of municipal housing construction companies and joint neighborhood development.
We also offer price-controlled homes in Austria and Sweden. Almost 18,400 (>90%) apartments in Austria and 100% of our approximately 40,000 apartments in Sweden are price-controlled. In total, around 16% of our entire portfolio is therefore subject to rent caps. By creating new, demand-oriented and – in part – subsidized homes in neighborhoods, we are helping counteract the shortage of available homes and mitigate rising rents, particularly for existing tenants. Through our development subsidiary, BUWOG, Vonovia constructs homes for both portfolio retention and sale, focusing on highly sought-after urban areas. A total of 2,090 (2024: 3,747) residential units were completed in this area in 2025, 800 (2024: 1,276) units for our own portfolio and 1,290 (2024: 2,471) units to be sold to third parties.
The use of public subsidies helps us to make existing and new housing affordable for our customers and, at the same time, to implement climate protection measures. This contributes to a balanced tenant structure in our neighborhoods. We remain focused on optimizing construction costs and we have adopted the “Basic House” policy (see ESRS E1 and ESRS 2 SBM-1) to provide sustainable, affordable homes for diverse target groups while introducing a share of subsidized homes to the market.
Accessible construction and refurbishment allows us to create homes that meet tenants’ needs – particularly for people with restricted mobility. In our portfolio, low-threshold structural measures as part of a (partial) modernization to create accessible spaces are often sufficient to significantly increase the level of living comfort in old age. Homes that are completely barrier-free, according to German industry standard DIN 18040-2, are only necessary in very rare cases. As an additional measure, we have developed a criteria catalog for construction measures for barrier-free (partial) modernization. This catalog is applied following an assessment of existing properties to determine potential areas for reducing barriers and the scope of modifications. Additionally, portfolio tenants can request age-appropriate upgrades through our program “Age-appropriate modernizations in response to tenant requests.” If a care level is determined, partial costs can be recovered by the respective health insurance. As a further measure, we plan our new buildings to make them highly accessible and wheelchair-friendly.
In addition to structural measures, the social infrastructure in the neighborhood also plays a key role. As a result, we have introduced further measures to address our impact on “Housing tailored to tenants’ needs,” such as senior-friendly apartments, services and neighborhood meet-ups, for example.
Vonovia also has a comprehensive hardship and social management system in place. Our objective is to support people’s ability to pay so that they can stay in their homes and their homes remain affordable. To this end, we offer individual support measures ranging from rent rebates to assistance with housing allowance applications and relocation assistance. A team of social managers who have been trained specifically to assist with such matters are on hand to help.
We do not want our customers above the age of 70 to have to worry about their livelihoods due to rising rent levels. We really don’t want them to lose their homes with us. This is why we support people aged over 70 if the standard local comparative rent changes. We support customers who feel that their apartment is too large but would like to stay in their neighborhood, for example, by switching apartments.
As part of our hardship regulations, we apply uniform standards based on those of welfare associations in the event of refurbishment work. These standards were developed in collaboration with the tenants’ association and other residential real estate companies, and help to ensure greater reliability and transparency in cases of hardship. In recent years, we have been able to achieve a positive outcome in the vast majority of hardship claims and provide direct assistance to the affected customers, for example by reducing or waiving the modernization allocation.
We are committed to ensuring that the rules of the game are followed in the housing market. This also applies in scenarios involving illegal subletting or apartment misuse, which can make it difficult for everyone to access the rental market fairly and can also place additional strain on the rental markets. In order to curb the associated abuse of the system, we take appropriate measures to combat fraud within the context of the applicable data protection regulations.
Finally, we offer homes for vulnerable target groups, i.e., for people who are homeless or at risk of becoming homeless, as well as refugees. The “Housing First” approach ensures that homeless people are provided with a standard tenancy agreement with all of the normal rights and obligations, regardless of any mental or physical health conditions that they might have. It is only after this that they are offered help in order to get some stability into their lives. Vonovia provides homes for this purpose across Germany as part of numerous cooperative initiatives. This is also a focus of our support for refugees.
The measures relate primarily to the German market, but also apply to some extent in Austria and Sweden.
The investment program for accessible (partial) modernization is implemented in this form exclusively within the German portfolio. The elimination of barriers is also, however, taken into account in the relevant building regulations in Austria and Sweden.
We allocate significant financial resources to manage our considerable influence on “housing tailored to tenants’ needs.” In the fiscal year under review, for example, € 807.5 million was invested in modernization measures/our portfolio. An additional € 354.0 million was invested in new construction (to hold) and € 811.2 million in maintenance. The total amount of € 1,972.7 million corresponds to the figures disclosed in the financial report. Investments at a similar level are planned for the coming fiscal year (see the Forecast Report).
Measures for fair rental pricing (impact “Contribution to affordable homes”) do not lead to significant operational or capital expenditure. Instead, they tend to limit revenue, as potential margins are not fully realized. New construction, on the other hand, involves operational expenditure. In 2025, this came to € -30.0 million (2024: € -25.0 million, see Earnings performance – Development segment). Investments in new construction (to hold) rose considerably to € 354.0 million in the reporting year (2024: € 224.5 million, see Earnings performance – Rental segment).
Customer Satisfaction Measures
Our actions to boost customer satisfaction are aimed at continuous service and product improvements, quick response and processing times within the customer service department and enhanced accessibility, such as expanding digital channels.
One key measure in relation to the policy for customer satisfaction is our centralized customer service centers, supported by decentralized local contacts in Germany, which ensure fast and reliable service, directly contributing to our goal of a high level of satisfaction. Our central, multilingual and long-term customer service centers in Essen, Dresden and Berlin act as the first port of call, whereas our caretakers, craftsmen and landlords look after the needs of customers on location. This structure allows us to identify customer dissatisfaction early and respond immediately.
We also maintain a central and permanent knowledge and training management system to enhance customer satisfaction. We continued our focus on developing the skills of our employees throughout the Group as a whole during the reporting year to meet the needs of our customers. The Training & Quality department collaborates here with HR to provide a comprehensive training catalog of around 120 training modules tailored to employees’ learning needs. Regular dialog formats ensure performance and quality. The aim is to guarantee the same level of quality for the entire portfolio in Germany. A high level of service and quality in turn contributes to our overriding goal of a high level of satisfaction as part of the management policy on customer satisfaction.
Our digitalization policy during the reporting year included implementing self-service functions across the Group, with a particular focus on tenant apps. We can use these customer apps as a particular example of how we map the full customer journey: from the apartment search process, including arranging viewing appointments, to the digital conclusion of contracts and all other issues affecting existing customers, such as ancillary expense bills, through to the concerns of customers moving out of our properties and former customers. The Mein Vonovia and DeuWo Digital apps have already been downloaded over 1.7 million times, with approximately 260,000 active users. The app portfolio also includes the BUWOG-Kunden app. The app features are being continually enhanced.
We also focus on extensive supplemental communication across the Group, including during the reporting year. For example, our website provides comprehensive, multilingual information on important housing-related topics, such as energy-saving tips for our customers.
We provide extensive personnel resources to manage customer satisfaction and our key impact “Impact of accessibility and service quality on customer satisfaction.” Over 1,000 employees work in our customer service centers, and additional local staff, including caretakers, craftsmen, and landlords, directly contribute to managing this material impact. This structure enables customers to directly assess how we manage this material impact, either on site or through our customer service centers.
Actions to Increase Quality of Living for Tenants Through Contribution to Neighborhood Development and Infrastructure
Environmental and social aspects go hand in hand as part of our central, holistic neighborhood approach. Vonovia is equally committed to both aspects and to promoting social interaction in the local community. Measures to strengthen shared living and measures to drive the greenhouse gas-neutral transformation of the housing stock only become manageable, effective and efficient through the neighborhood approach. With our multidimensional neighborhood development approach, which targets the actual impact we have identified as material, different strategic components are applied individually to each neighborhood. These measures relate to the German market and focus on the clustering by neighborhoods (urban quarters) described in ESRS 2 SBM-3 in our strategic portfolio:
We perform building upgrades aimed at energy efficiency and install photovoltaic systems on our own properties. Sequential energy-efficient upgrades to our own housing stock in line with our climate pathway, the use of innovative heating and electricity concepts (e.g., district heating grids and our heat pump cubes), the expansion of renewable energy supply systems (especially using photovoltaics) and establishing smart links between these systems within the neighborhood are central elements of our climate strategy, which are particularly effective in the neighborhood thanks to the exploitation of synergy effects and economies of scale (see ESRS E1).
We are also expanding our neighborhood infrastructure (green and communal areas, playgrounds, establishment of local suppliers, educational and social facilities). A large number of diverse measures are being developed in order to meet the needs of the neighborhood concerned.
The provision of premises for social facilities plays a key role. Freely accessible space that can be used by the public can be seen as a key criterion for neighborhoods that offer quality of living and, thanks to additional opportunities for networking and the diverse ways in which spaces can be used, increases the variety of services on offer and quality of life for all users in the immediate vicinity. This is why, in the 2025 fiscal year, we made 88,000 m² or 13.9% of our commercial space available for social and community purposes (e.g., senior citizens’ centers, day-care centers, rooms for childcare, etc.). With our flexible “freiRaum” neighborhood concept, we also offer free, low-threshold locations for local initiatives and groups to allow people to get involved in social events and to network in our neighborhoods.
We also take action to promote state-of-the-art mobility concepts. These measures support the mobility transition towards lower-emissions (electric) mobility in our neighborhoods. When designing new construction projects, we pay attention to good public transport connections, focus increasingly on bicycle parking spaces and consider providing charging facilities for electric mobility right back at the planning stages. To date, we have installed 128 neighborhood charging stations for electric mobility in our existing neighborhoods, 119 of which are already in operation. We are planning a further 100 locations in 2026. Car and bike sharing services (including for electric vehicles) round off our offering. We are aiming to gradually connect our neighborhoods to municipal cycle path networks.
In the 2025 fiscal year, we invested a total of € 648 million (2024: € 510 million) in our urban quarters in Germany.
For 2026, we expect to invest approximately € 907 million in urban quarters.
Effectiveness of the Measures
The insights from the customer satisfaction surveys provide the operational departments and management with a fundamental basis for decision-making on customer satisfaction. The results give us an insight into whether our actions are appropriate and address our material impacts. The assessments of the satisfaction survey are discussed quarterly in Germany in the regional business areas on site (and directly with the specialist departments in Austria) and measures are developed at the neighborhood/building level. They also include our customers’ satisfaction with the neighborhood environment, enabling us to evaluate our neighborhood development measures. In Sweden, too, customer satisfaction is a fundamental benchmark for all business processes.
We use metrics that are commonplace in the housing industry to analyze and evaluate the effectiveness and appropriateness of our measures in relation to our contribution to affordable housing that meets tenant needs. Key examples include vacancy and turnover rates, as well as the rent collection rate, which is used to measure payment defaults. We evaluate applications submitted as part of our hardship and social management system to draw conclusions as to the prevalence of these cases and the effectiveness of our supporting measures to protect customers.
Our Group policies and our Code of Conduct mean that we are obliged to comply with all legal requirements. Rent pricing in particular is subject to stringent regulation to prevent exorbitant rents, for example. As part of the customer surveys, analyses of response and processing times are also conducted. Our experience shows that accessibility, speed and transparency in service are decisive factors for achieving customer satisfaction. These analyses allow us to identify weaknesses in our service commitments and address them effectively.
No serious incidents relating to human rights have been reported to us in connection with the implementation of our actions.
We use selected additional metrics to track the effectiveness of our measures and the extent to which they meet our objectives. For more information, see S4-5.