Blog (English)

• Median contract rent will be EUR 7.21 per m² in 2023
• Strongest increase in new contract rents in Dahme-Spreewald, lowest rents in Central Saxony
• City of Munich most expensive place to live in Germany at EUR 16.30 per m² - increase of 21 per cent in five years

Immigration from abroad to Germany remains at a high level in 2023, even if it is significantly lower than in the previous year. A recent analysis by economic and property data provider empirica regio GmbH shows that Germany recorded net immigration of around 660,000 people in 2023. After almost 1.5 million net immigrants in 2022 and a good 1.1 million immigrants in 2015, this is still the third-highest figure since 1992. With a good 121,000 net immigrants, Ukrainians make up the largest group of immigrants.

The example of Rostock shows how important regional population analyses are for investments in the housing market. Young adults are moving into the city, while rents are rising and vacancies are falling. Young workers and families, on the other hand, are moving to the surrounding areas or to other labor market regions. Therefore, the basic rule for investors is: They should base their strategies on solid demographic data in order to minimize risks and take advantage of opportunities.

Various analyses have recently attempted to quantify the possible price discount on non-energy-efficient properties. Such a discount is undisputed, but the amount is probably overestimated. In a background analysis, empirica has examined more closely how this discount can be calculated on the basis of asking purchase prices.

On 25 June 2024, the first results of the 2022 census were published by the Federal Statistical Office. The empirica regio team has also been waiting for these results, as the census will put many important official statistics on a new footing. In this article, we would like to briefly explain what this means for the empirica regional database.

The new empirica housing market forecasts show the demographic trends in the German housing market until 2045. If immigration to Germany does not significantly decrease, then the population will continue to rise. The empirica demand forecast shows an annual new construction demand of around 170 thousand apartments for the period 2024-27. After that, demand decreases somewhat, but in the mid-2030s there will be a small demographic upheaval, causing demand from older households to rise again.

Net rents in major German cities (A-cities) are 70 per cent more expensive than 13 years ago. The rent burden for low-income households is 31 per cent across Germany. And: the development of rents is dependent on the development of incomes, particularly in the south. These are the key findings of a new study by economic and property data provider empirica regio GmbH. Our conclusion: The housing market is facing major challenges. The demand for new and affordable housing in Germany continues to grow. And: those who can, will stay in their own home.

In the housing policy debate around new housing, immigration, shortage of housing and urban sprawl, the issue of vacancy rarely plays a role. The vacancy rate offers important insight into the state of housing shortage in individual regions. However, a generalised view of the data alone does not help in the analysis of vacancy figures. The mutual interactions are far too complex, for example, when it comes to the regionally very different imbalance between supply and demand or migration movements from the A and B cities to more rural areas.

• Around 1.1 million people with Ukrainian citizenship were living in Germany at the end of September.
• Highest immigration rates in March, April and May with up to 375,000 people per month.
• Mostly underage and well-educated people come.

A look at migration within Germany shows: The basic trends were indicated years ago. While the big cities are losing more and more in internal migration, the districts and small independent cities in Germany are gaining more and more. Another turning point could be immigration due to the war in Ukraine.

The top 7 cities in Germany show shrinking tendencies. In 2021, most metropolises again recorded negative net migration. This continues the shrinking trend of the past years. This is shown by figures from the economic and real estate data provider empirica regio.

empirica regio has aggregated, adjusted and analysed property tax data from the federal states and the federal government. The data are always published by the statistical offices with a delay of approximately one year.

Singles and large families pay the highest rents per square metre in Germany. This is the key finding of a recent analysis by empirica regio GmbH. Especially in the large cities and major cities, the so-called A-cities, families have to spend more than others on rent.

The surrounding areas of Germany’s A-cities are becoming increasingly important as places to work, this is the result of an analysis by empirica regio GmbH. We have examined the commuter balances, commuter rates and commuter links of the German metropolises and their surrounding areas.

Ever since Tesla chose Grünheide as the site for its fourth Gigafactory, it has been clear: the previously little-noticed region around the little speck-belt town of 8,000 inhabitants in the east of Berlin is now seen as one that will be boosted and transformed in many ways. Grünheide’s mayor described the Tesla settlement as “winning the lottery”.

The updated empirica housing market forecast on new construction demand is now available regionally differentiated for flats in single and two-family houses as well as flats in multi-family houses. Depending on the scenario, between 233,000 and 253,000 additional flats will be needed in the short term.

The economic and real estate data provider empirica regio GmbH has determined the per capita residential space consumption of all German municipalities with 400 or more inhabitants. Almost 9,000 municipalities and 107 independent cities were analysed. The results show that popular holiday destinations in particular consume a lot of living space per inhabitant, but people in rural regions also have a particularly large amount of living space at their disposal. In the German metropolitan areas, on the other hand, people are moving closer together and living on less living space.

In 2008, an article in the German journal Informationen zur Raumentwicklung (Information on spatial development) posed the question Suburbanisation … and no end in sight? 1 In 2021, this question can still be asked in exactly the same way, albeit against the backdrop of a completely different housing market situation than 13 years ago. Back then, the focus was on shrinkage, whereas today it is on the growing pains of cities.

The updated housing market forecast on the demand for new construction is now available for flats in single and two-family houses as well as flats in multi-family houses.

Initial Situation Before the Corona Crisis In recent quarters, purchase prices in Germany have continued to rise, while rents in many core cities rose less strongly than before or even stagnated.

Translated by Jan Grade Background In 2015 the so-called rent brake was introduced in some federal states in Germany. The aim of the initiative was to curb the price increase of newly contracted rents in prospering cities so that housing in these cities remains affordable even for middle and low-income households. At least that is how the draft law on the corresponding amendment to the tenancy law should be understood. ZEIT ONLINE has asked empirica regio to investigate the price development of newly advertised rental flats since the introduction of the rent brake in selected cities. However, the following evaluation is not a comprehensive study of the effects of the rent brake, but only an ad-hoc evaluation of the supply rents of individual cities.