New rental rates in Germany rise by 3.5% — Der Spiegel
In Germany, new rental rates for apartments in multi-family buildings rose by 3.5% in the third quarter compared with the same period last year. Der Spiegel reports this, citing data from the Association of German Mortgage Banks (VDP).
The VDP, which represents around 50 real estate financing institutions, including Deutsche Bank, Commerzbank, savings banks and land banks, said the situation on the rental market was continuing to worsen. In the previous quarter, new rental rates rose by 3.2%. According to the association's CEO, Jens Tolckmitt, the situation is particularly tense in large cities.
Data from actual transactions
The VDP indices are based on data from actually concluded real estate purchase and rental transactions provided by more than 700 German banks as part of mortgage financing. The index, prepared by vdp Research, is part of the German Federal Bank's real estate price monitoring. Unlike analyses of listings, these data take into account finally agreed prices and rental rates.
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Housing prices are rising more slowly
At the same time, residential real estate became 1% more expensive in the third quarter year on year. Prices for private houses rose by 1.3%, for owner-occupied apartments by 2.3%, and for multi-family buildings by 0.5%.
Residential real estate prices rose the most in Hamburg, by 2.4%, followed by Frankfurt, by 1.6%, and Cologne, by 1.4%. A slight decline was recorded in Stuttgart. Compared with the second quarter, prices decreased slightly in all seven largest cities and on average across the country. At the same time, rates on ten-year mortgage loans exceeded 4%.
Germany is estimated to be short of more than one million apartments. According to an analysis by the Federal Institute for Research on Building, Urban Affairs and Spatial Development, around 320,000 new apartments are needed annually by 2030, while Ifo expects fewer than 200,000 completed homes in 2027 and 2028.
