Dynamic Price Growth for Existing Condominiums in Berlin since 2013
The latest edition of the LBS Residential Property Price Index, which the empirica research institute periodically compiles on behalf of the LBS Nord state building and loan association, shows that prices for existing condominiums in the German capital have increased by more than ten percent annually since 2013. The researchers diagnosed a citywide price growth of 11.4 percent per year by the third quarter of 2016. For the purpose of the survey, for-sale ads in dailies and online portals posted in Q3 2016 were analysed. This shows inter alia that the past year experienced a particularly brisk price growth.
Condominium Prices Highest in Friedrichshain-Kreuzberg
In the course of the past three years, the borough of Friedrichshain-Kreuzberg took the place of Mitte as the most expensive borough, or so the findings of the property price index suggest. By Q3 2016, every other existing condominium in Friedrichshain-Kreuzberg had a price tag of at least 3,785 euros per square metre of residential floor area. This contrasts with a median square-metre price of c. 3,600 euros in the borough of Mitte. The average square-metre price for existing condominiums across the city was 3,100 euros by the third quarter of 2016. Standard prices for this property type now exceed 2,000 euros per square metre in ten of Berlin’s twelve boroughs.
Steepest Price Hikes Recorded in Tempelhof-Schöneberg and Neukölln
The fastest price growth for existing condominiums over the past three years was registered in the boroughs of Tempelhof-Schöneberg and Neukölln. Here, condominium prices went up at rates exceeding 16 percent per year. Even peripheral boroughs like Spandau (+13.3 percent) and Marzahn-Hellersdorf (+12.0 percent) recorded annual price increases in the double-digit range. But despite the drastic price hikes, Marzahn-Hellersdorf continues to be the borough with the most affordable pre-used condominiums. At 1,894 euros per square metre of residential floor area, the local price tag is well below Berlin’s citywide average. Another thing that the empirica research institute found out when compiling the LBS Residential Property Price Index is that despite the increased prices, buying a flat remains financially more attractive than renting in two of three boroughs in Berlin. The borough where the financial benefits of homeownership are highest is Lichtenberg. The average price of 130,000 euros for a pre-used condominium implies monthly savings of 144 euros compared to renting.