Rents Continue To Rise In Berlin, Prices For Ownership Are Levelling Off
The current market report of the state-owned development bank IBB once again confirms the trend of rising rents in Berlin. Tenants partly have had to accept steep price increases in Germany’s capital. According to the IBB market report, the median of rents rose by 6.7 % to a net cold rent of EUR 8.80 per square metre in the last year. However, the development in the market for home-ownership shows a completely different picture. Whereas middle purchasing prices for private homes rose to an amount of barely EUR 350,000 in the fourth quarter of 2015, price quotes per square metre have decreased for the first time in a long while, indeed by an average of EUR 10.00. On average, buyers paid only EUR 3,426 per square metre.
Friedrichshain-Kreuzberg And Mitte Have The Highest Rents
Although rents in Berlin are still quite moderate compared to other German major cities, significant differences can be observed in each area and also in Berlin’s districts. The highest rents among Berlin’s 12 districts were recorded in in the inner-city districts Friedrichshain-Kreuzberg (EUR 10.99 per square metre) and Mitte (EUR 10.06 per square metre). Rent prices in the districts Charlottenburg-Wilmersdorf (EUR 10.00 per square metre), Pankow (EUR 9.46 per square metre) and Steglitz-Zehlendorf (EUR 8.87 per square metre) recorded an above-average level last year. Only the districts being further away from the buzzing centre of the Spree-metropolis remained substantially below the average rental level. These mainly include Treptow-Köpenick (EUR 7.5 per square metre) and Marzahn-Hellersdorf (EUR 5.76 per square metre).
Berlin Continues Its Growth Path
Berlin’s population growth and the acute housing shortage will have further impact on the rental price trend. Solely since 2012, 144,000 people have crowded into Berlin’s already tense housing market. The Senate Administration for Urban Development and Environment expects a further population growth of 266,000 people until 2030. This is an increase of 7.5 % within a 15-year period. Although, between 2014 and 2015 the number of construction permits rose from 19,000 to 22,000, the accelerated construction of new buildings will according to experts’ expectations, however, not meet the high demand for housing. In the first quarter of 2015 Germany’s capital had for the first time again as much inhabitants as in 1996. With around 3.6 million people living in Berlin, the loss of population of the post-reunification period has in the meantime been compensated again. This will lead to further price increases in the rental market.