The sharp rise in rental prices for homes in major German cities is slowing compared to the rapid growth seen recently, according to an analysis by real estate specialist Jones Lang LaSalle (JLL).
Outside the major cities, however, price increases accelerated further in the first half of the year, experts said.
Overall, rents in Germany are rising, but purchase prices for homes in the major cities are falling.
The study analyzed approximately 35,000 rental advertisements and 41,000 purchase advertisements for new and existing buildings.
According to JLL, the average rental price for apartments in the eight largest cities Berlin, Hamburg, Munich, Cologne, Frankfurt, Düsseldorf, Stuttgart and Leipzig rose by 6.3% in the first half of the year compared to the same period last year.
In contrast, the second half of 2023 saw higher year-on-year growth of 8.2%.
According to the study, the largest increases in the first half of the year were again seen in Berlin, with an average of 11.4%, followed by Leipzig (9.8%) and Frankfurt (9.4%).
According to Sören Gröbel, a residential real estate research expert at JLL, one of the factors driving up rents is the stagnation in residential construction.
The impact of political efforts, such as the promotion of new construction and the planned building type E for simpler housing construction, will only become visible over time, says Gröbel.
“From the supply side, pressure on rents is likely to remain high in the medium term,” he added.
