Condominiums for owner-occupation or as private investment are are popular as ever. An unfailing sign suggesting so: Prices are going up, as the just published Accentro Homeownership Report 2014 shows. It reveals that nearly 130,000 flats changed hands in Germany's major cities in 2013. Year on year, this actually marks a drop by 2.8 percent. Yet the revenue realised increased by 4.1 percent during the same period of time. The revenue per sale increased even faster at a rate of seven percent.
Berlin Outpaces Munich in Sales
Accentro studied the data of surveyor committees of Germany's 82 largest cities to compile its Homeownership Report. The data were used to compile rankings on various markets aspects. How dynamic the growth of the residential property markets was becomes evident when comparing the prior-year figure of a given market. The report also includes a ranking of cities with the most successful housing markets – and has something of a sensation to announce: For the first time, the German capital took the lead from the traditional star performer, Munich. A sum total of 4.28 billion euros was generated in condo sales in Berlin last year, which is 18.3 percent more than in 2012. This compares to approximately 3.77 billion euros in the Bavarian state capital. The gap is actually even wider because Munich fails to differentiate between homeownership and part ownership in its sales figures.
The enormous popularity of condominiums is not limited to Berlin. In 39 out of 79 major cities for which data are available, the number of single condominiums retailed rose year on year. In 14 cities, the growth rate was actually in the double-digit range. Düsseldorf, for instance, reported a hike by 19.4 percent.
Report Identifies Winners and Losers of the Market
The Homeownership Report, rather than just showing how popular condominiums have become in Germany's big cities, also reveal how heterogeneously the German housing market is developing. For instance, many cities in Bavaria made it into the top rankings. A case in point is Regensburg, which placed among the top ten cities analyses due to the number of sales per 1000 residents, the number of new units sold, and the revenue per sale. In 2013, an average condominium sales in this Bavarian campus town yielded approximately 311,300 euros, which is 5.5 times as much as a condo sale in Salzgitter, for example. This is hardly surprising: The markets of economically undeveloped regions tend to fare poorer in the ranking of the Homeownership Report. Then again, some of these very cities are catching up: Chemnitz and Cottbus, for instance, increased their sales by around 79 percent each.
Favourable Forecast for German Housing Market
There is no reason to worry that the predominantly positive development in Germany's housing markets might end any time soon. The demand for housing remains high – in the metropolises and campus town more so than elsewhere. At the same time, the historically low level of interest rates and the scarcity of safe investment alternatives provide added incentives for investors to commit themselves in condominiums.