Latest News

Berlin property market update: purchase prices and rents both on the rise

June 6th 2019

By Property Investor Today

Purchase prices in Berlin’s property market are rising faster than expected, according to Black Label Properties.

The Berlin-based international agency recently published its 2019 Price Map and Rental Map showing current prices and trends on the German capital’s property market, with purchase prices increasing by 10-15% rather than the expected 5-8%.

The price per square metre within the popular S-Bahn ring, meanwhile, has almost equalled last year, with buyers now struggling to find an average apartment for sale in the centre of Berlin for less than €4,000 per square metre.

The purchase price for new builds has also exploded, with medium quality new builds at over €6,000 per square metre, while renovated vacant apartments now have a value of more than €4,500. This is an increase of between 10-15%, despite there being fewer buyers competing for homes.

A similar upward trend can be seen in the Rental Price Map 2019. Although rents are not rising as quickly as purchase prices, rents within the S-Bahn belt continue to increase at an impressive rate. Renters will now struggle to find an apartment for less than €15 per square metre on the open market.

Investors should be investing in a rented apartment for the biggest gains

There is a significant difference in price of around 30% between vacant and rented flats, which are much cheaper to invest in. They are leased to long-term tenants who have up to 10 years’ self-employment protection so this is a good option for those looking to invest in Berlin.

The reason for the big price gap between vacant and occupied apartments is because there are significantly fewer vacant apartments to purchase than last year. As a result, prices for vacant apartments continue to rise.

Apartments, which are subject to a re-letting of the rental price brake, rarely come onto the open market. Either they are sold for profit or rented out as a shared flat and/or furnished, or traded on the ‘black market’. The negative effects of the rental price brake have made the search for an affordable rental apartment much harder.

Rents will continue to rise – especially in the southwest districts like Steglitz, Tempelhof, Mariendorf, Britz, and Zehlendorf – there is still a lot of movement on the market.