Housing has once again become more expensive, particularly for tenants. Asking rents in the second quarter of the year were 4.0 percent higher than in the same period a year earlier, the Institute of German Economy (IW) in Cologne announced on Monday. Condominiums and single- and two-family houses each became 0.8 percent more expensive, meaning it is "not yet possible to speak of a strong new upswing" in purchase prices.
Rents rose sharply especially in the major cities of Cologne (plus 7.9 percent), Hamburg (5.5 percent) and Leipzig (5.4 percent), the IW further reported. This means they climbed considerably faster than inflation, which stood at 2.6 percent.
At the same time, supply is lacking: nationwide, nearly 12 percent fewer rental apartments were advertised than at the start of 2022, the IW explained. The researchers pointed out that the rental supply had fallen far more drastically in individual major cities. In Hamburg, the rental supply more than halved, down 57 percent; in Frankfurt am Main, 43 percent fewer apartments were advertised, and in Leipzig, the figure was 40 percent.
In Berlin, by contrast, there was a 43 percent increase compared with 2022. However, the IW attributed this rise to the fact that the so-called rent cap (Mietendeckel) had choked off supply at the time.
The rent cap was a law in force in Berlin that froze rents for around 1.5 million apartments completed before 2014 at their June 2019 level. From November 2020, rents that exceeded a defined ceiling by more than 20 percent were also banned. In a ruling dated 15 April 2021, the Federal Constitutional Court declared the law unconstitutional.
The situation on the purchase market looks somewhat different, according to the IW. Nationwide, there are now almost twice as many condominiums and around 140 percent more single- and two-family houses on offer than at the start of 2022. However, this is due to higher financing costs, which have caused more prospective buyers than before to fail to secure a purchase.
"Those who want to rent are met with a scarce supply and rising prices, those who want to buy often fail because of financing."
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