Prices for apartments and houses have risen to a record

Dhe prices for German residential real estate rose at a record pace at the end of 2021. From October to December they increased by an average of 12.2 percent compared to the same period last year. “This is again the strongest price increase for residential real estate transactions since the start of the time series in 2000,” shared the Federal Statistical Office on Monday with On average for 2021, prices for residential real estate rose by 11.0 percent overall, after 7.8 percent in 2020.

The prices for one- and two-family houses in sparsely populated rural districts rose particularly sharply in the fourth quarter by 15.9 percent. Condominiums there increased in price by 13.2 percent. In more densely populated rural districts, the plus for single and two-family houses was 14.5 percent and for condominiums 11.2 percent.

The seven major cities of Berlin, Hamburg, Munich, Cologne, Frankfurt, Stuttgart and Düsseldorf also recorded above-average increases. Here, detached and semi-detached houses cost around 12.8 percent more at the end of 2021 than a year earlier. Condominiums increased in price by 12.7 percent.

the Federal Bank has been warning of increasing dangers on the German real estate market for a long time. “The overvaluations of residential real estate increased,” it said recently in the monthly report of the Bundesbank. “According to the latest estimates, real estate prices in cities in 2021 were between 15 percent and 40 percent above the price indicated by fundamental socio-demographic and economic factors.” In 2020, the overvaluation was a maximum of 30 percent.

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