FRANKFURT / LONDON (IT BOLTWISE) – Real estate prices in Germany are rising significantly again, especially in the big cities. In the third quarter, houses and apartments recorded a price increase of 3.8 percent compared to the previous year. The ongoing housing shortage is also driving up rents, further exacerbating the challenges in the housing market.
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Real estate prices in Germany recorded a significant increase in the third quarter, especially in the country’s large metropolises. According to the Association of German Pfandbrief Banks (VDP), prices for houses and apartments rose by 3.8 percent compared to the same quarter last year. This development shows that the crisis on the real estate market has been overcome and buyers are willing to pay higher prices again.
In cities such as Munich, Düsseldorf, Hamburg and Cologne in particular, residential property prices have risen by more than five percent. These metropolises are known for their high demand for housing, which further drives up prices. Rents have also developed accordingly, with new contract rents increasing by 3.7 percent on a national average and 3.8 percent in major cities.
VDP general manager Jens Tolckmitt emphasizes that the housing shortage in large cities will continue for several years. Although the federal government would like to achieve faster and easier construction approvals with the so-called construction turbo, this is not enough, according to Tolckmitt. He calls for additional measures such as state guarantees for real estate loans in order to enable new housing construction on a large scale.
The current VDP figures are based on real transactions from over 700 banks and are therefore considered particularly reliable. They show that investors are increasingly entering the real estate market again, especially in multi-family homes, which recorded a national average price increase of over five percent. This suggests that buyers and homebuilders have become accustomed to the increased interest rates and the market is stabilizing.
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