East German Housing Markets Keep Catching up
While the number of condominium sales in the major German cities declined overall in 2018, average selling prices increased noticeably, as the ACCENTRO Homeownership Report 2019 shows. Another finding is that the performance of several cities in the East German states was particularly positive.
The fastest price growth rates among the major cities were registered in Halle (Saale) in Saxony-Anhalt with an increase of 35.56 percent over prior year. The city of Jena in Thuringia ranks third with a growth of 28.48 percent, while yet another outperforming, high-ranking city is Chemnitz with a rate of 17.56 percent. It should be remembered that Chemnitz had already been among the big winners of last year’s report after scoring a price growth of 19.74 percent in 2017. The price growth in this city in Saxony therefore sustained its upward trend. Another East German city that made it into the top ten cities with the fastest price growth in 2018 was the Rostock, the most populous city in Mecklenburg-West Pomerania.
Leipzig among the Most Active Housing Markets
Leipzig also managed to consolidate its status as one of the most important housing markets in Germany. In terms of sales volume, Leipzig continues to rank eighth, right behind the seven Class A cities. The Saxon city actually outperforms some of the Big Seven cities in regard to the number of transactions, and it ranks fifth nationwide by total number of condominiums sold.
Striking to note is also that Leipzig’s housing market shows an above-average level of activity, even though it counts among the largest and most important in Germany. Judging by sales per 1,000 residents, Leipzig is now in rank seven, after placing second the previous year. In other words, the city’s housing market is as busy as you would normally expect the market of smaller cities to be.
New-Build Construction Doing Better in Smaller Cities
In the new-build segment, Leipzig also shows a similarity to the Big Seven cities that it trails because it matches the unambiguously negative trend of most Class A cities. The number of new-build flats in Leipzig declined by 11.58 percent since 2017. New-build housing sales also went down in Dresden, the state capital of Saxony, but unlike in Leipzig, new-build construction activities remain disproportionately high here. Dresden actually made fifth place in this category with 1,205 new-build flats sold, behind Berlin, Hamburg, Munich and Frankfurt am Main.
By contrast, the previously mentioned cities of Halle (Saale), Jena, Rostock and Chemnitz report a positive trend in new-build construction. The number of new-build flats sold in these East German cities has gone up noticeably, which suggests that property developers and investors seem to be quite confident as far as the development of selected cities in the eastern part of the country goes.