Prices for houses and flats in Germany continued their downward trend in the first quarter of 2024, with residential properties selling on average 5.7% cheaper year-on-year.
Compared with the last quarter of 2023, the loss in residential property values was 1.1 percentage points from January to March, the federal statistics office in Wiesbaden reported on Friday.
This was the sixth consecutive quarter that prices decreased in both cities and rural regions, according to preliminary figures.
The largest year-on-year declines of 9.5% were observed for detached and semi-detached houses in Berlin, Hamburg, Munich, Cologne, Frankfurt, Stuttgart and Dusseldorf.
Flats in these cities fell in price by an average of 4.6% within a year. In sparsely populated rural districts, buyers paid an average of 6.7% less for detached and semi-detached houses and 2.4% less for condominiums than in the first quarter of 2023.
Since mid-2022 - the peak of a long housing boom - Germany's property market has been in decline. This is mainly due to the sharp rise in interest rates, making loans more expensive.
Many people can no longer afford their own home and investments are no longer profitable for large investors.
At the same time, demand for housing remains high, especially in cities, while new construction is in the doldrums due to higher interest rates and construction costs.
As a result, the number of building permits for new builds and flat conversions in April fell 17% year-on-year. In view of the housing shortage, construction and property industry associations are calling for more state subsidies, especially in conurbations.
