Study: demand for rental apartments increases significantly
In Germany, the demand for rental space has significantly increased, according to a study by real estate platform ImmoScout24. This trend is particularly noticeable in smaller cities, even surpassing the top eight metropolitan areas. This leads to higher rental prices, especially in new construction. The prices for commercial real estate, however, have slightly decreased.
The demand for rental apartments in Germany is on the rise. This leads to higher rental prices, as ImmoScout24's business manager, Gesa Crockford, pointed out. "The demand pressure on the rental market has reached a new record high and illustrates the tense situation," she said. "The increasing demand is no longer just a phenomenon of metropolitan areas." The metropolitan areas' surroundings, regional centers, and economically well-connected locations are also attracting more and more seekers. The demand for rental space in the metropolitan areas' surroundings increased by 17% between April and June within a year, and in other cities by 19%.
Rental prices for new construction apartments on ImmoScout24's platform rose nationwide by 2.7% in the spring compared to the beginning of the year. Within a year, they even rose by 8.7%. An average two-room apartment with 70 square meters in new construction was offered for 856 Euros in cold rent per month. This corresponds to a square meter price of 12.23 Euros. However, in Munich, the traditionally most expensive pavement under Germany's metropolitan areas, the rent in new construction averaged 1756 Euros, with 25.08 Euros per square meter. The rent for existing apartments remained unchanged nationwide in the second quarter, but was 4.2% higher than the previous year. The average 70-square-meter apartment cost 599 Euros, with 8.56 Euros per square meter.
Despite significantly increased demand, prices for many commercial real estate properties have remained relatively stable in the spring. In seven of eight metropolitan areas, the asking prices for existing owner-occupied apartments remained largely stable from April to June, according to ImmoScout24. Nationwide, however, prices here fell by 1.1%, and for new construction apartments by 2.1%. This is due to the fact that there are fewer new construction projects and these are increasingly being built at the city outskirts instead of in the city center. "This results in less price development dynamism."
ImmoScout24 sees signs of a market revival. "The residential real estate market for purchases is gaining momentum again, the waiting phase for buyers and sellers is over," said business manager Crockford. Both contact and financing inquiries on the internet platform are therefore increasing significantly. "People want to buy again." At the same time, more single-family homes are coming onto the market. This is particularly evident in metropolitan areas.
The interest in purchasing - measured by contact inquiries at ImmoScout24 - increased by 47% in the largest eight cities in the year-on-year comparison. This is the highest level since 2017. This trend is continuing in the metropolitan areas' surroundings (+36%). The purchase prices for existing homes were 0.9% higher than the previous year nationwide in the second quarter, but 0.6% lower for new construction homes compared to the previous quarter.
The trend of higher rental prices in Germany, as noted by ImmoScout24, is particularly noticeable in Berlin, leading to increased rents for apartments. This is a result of the significant demand for rental space in the city.
The real estate market in Germany is seeing a revival, with the demand for purchasing properties also on the rise. ImmoScout24's business manager, Gesa Crockford, has observed a 47% increase in contact inquiries for purchasing properties in the largest eight cities compared to the previous year.
In contrast to the increased demand and prices for rental apartments, prices for commercial real estate properties have remained relatively stable in many cities. However, there have been fewer new construction projects in city centers, leading to less price development dynamism.
