25 09 2018

11th ACCENTRO Homeownership Report 2018 - Berlin Remains Germany’s Most Important Housing Market

Berlin, 25 September 2018 – Berlin remains squarely in the lead nationwide with 21,377 residential units sold in 2017 (down from 22,549 units in 2016). The city is trailed at considerable distance by runner-up Munich with 9,950 units sold. However, it was the second time in as many years that the capital registered a decline in the number of flats sold, which dropped from 7.42 percent in 2016 to 5.20 percent. But since condominium prices in Berlin simultaneously rose by 5.5 percent to 263,966 euros—up from 250,215 euros in 2016—the revenue total maintained a stable sum total of 5.64 billion euros. This is the gist of the 2018 ACCENTRO Homeownership Report that is based on the analysed data of property valuation committees for the 82 largest housing markets in Germany.

Price Growth in Berlin Levelling out

At 5.50 percent, the one-year price trend in Berlin topped the national average of 4.56 percent, but only just so and it did lag behind the trend in Munich (6.03 percent), Hamburg (13.17 percent) and Frankfurt am Main (9.01 percent). In 2016, Berlin had still registered a price growth of 16.73 percent. “In the wake of the enormous price hikes seen over the past ten years, the pace has slowed for the time being. But the stats in the German capital keep pointing upward,” said Jacopo Mingazzini, CEO of ACCENTRO AG. During the past ten years alone, selling prices for condominiums in Berlin went up by 134.63 percent. In a ten-year comparison of the major German cities, Berlin again comes out on top. If, however, you limit the long-term comparison to the past five years, Berlin slips down to rank ten.

Upside Potential of Condo Prices Remains High

The price level for condominiums in Berlin is still relatively low compared to other metropolises. Although Berlin reported a 26.69 percent higher revenue total than Munich, the fact is explained by the high number of sales. In fact, they are twice as high in the capital. “A comparison with other top cities shows that the housing market in Berlin still has considerable catch-up potential,” said Mingazzini. The condominium prices paid in Munich are almost 70 percent higher, while in Hamburg the average revenue per sale is roughly 52 percent higher. The only city among Germany’s “Big Seven” whose price level compares to Berlin is Cologne. In the history of this survey, Munich has always scored the highest revenue per sale. That being said, Frankfurt and Hamburg managed to narrow the gap in 2017. The average price tag exceeded 400,000 euros in all three of the cities in 2017. Berlin, meanwhile, still ranks twelfth in terms of price level, exactly where it was a year ago.

Number of New-Build Condo Sales Perking up

Despite the declining number of condominium sales, the revenue total has remained stable, which is explained primarily by the share of new-build flats sold. The total of 5,711 new-build condominium sales implies a modest 1.84-percent increase, up from 5,608 units in 2016. Aside from Düsseldorf, Berlin is the only one among the “Big Seven” cities that registered an upward trend in new-build condominium sales. In Germany as a whole, the number of new-build flat sales declined (by 14.63 percent). Yet Berlin actually expanded its lead over the runner up, which is Munich. Around 3,000 new condominiums were sold in the Bavarian state capital. “The investment focus keeps shifting more and more to the capital because Berlin has far greater reserves than Munich in terms of both price upside and available building land,” said Mingazzini. “The stable number of sales illustrates that Germany’s first city continues to have massive appeal for buyers of new-build condominiums,” he went on to say. Transaction figures in Berlin have quadrupled since 2007. That year, only 381 new-build condominiums changed hands. While the pace of the market action has obviously slowed, Berlin continues to outperform the overall market.

About the ACCENTRO Homeownership Report

This year’s edition marks the eleventh time that ACCENTRO Real Estate AG published its Homeownership Report. The analysis is based on residential property sales transacted in Germany’s 82 major cities during the reporting year of 2017. The fact that it has access to the actual data of the surveyor committees sets this report distinctly apart from similar publications that tend to be based on expert assessments or the evaluation of quotes.
Detailed findings of the ACCENTRO Homeownership Report on Germany’s “Big Seven” cities and the trends of the past ten years are also available online in the ACCENTRO database, and can be retrieved in selective drilldowns:

About ACCENTRO Real Estate AG

ACCENTRO Real Estate AG is a listed residential property company. Its core business consists of tenant-friendly housing privatisations. The company’s subsidiary ACCENTRO GmbH is the leading service provider on Germany’s housing privatisation market. ACCENTRO Real Estate AG has its registered office in Berlin and is listed on the Prime Standard of the Frankfurt Stock Exchange (WKN securities code number: A0KFKB).

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