Düsseldorf is becoming more and more expensive, Berlin is stagnating

Housing shortage

Rents are rising almost everywhere – except in this city

The German housing market remains under pressure. Rents have become particularly expensive in these cities.

The housing shortage in Germany remains an urgent problem: According to the current housing barometer from Immoscout24, rental prices rose in almost all regions and building age groups in the fourth quarter of 2024. Demand has increased significantly year-on-year, particularly in metropolises and independent cities – despite a usual seasonal decline towards the end of the year.

Gesa Crockford, managing director of Immoscout24, sees a need for action to promote housing: “With the federal election campaign, discussions about stricter rent regulations are intensifying. But instead of just combating the symptoms of rising rents, the focus should be on the actual problem: there is a lack of living space. “

Demand for rental apartments fell slightly compared to the previous quarter for seasonal reasons: the decline was 2 percent in metropolises and independent cities and 4 percent in rural areas. Nevertheless, the seasonal effect was significantly weaker than in previous years.

Demand fell by nine percent in the metropolises in the fourth quarter of 2023, and by even ten percent in 2022. A year-on-year comparison, however, shows a different picture: search volumes rose by 14 percent in major cities and by 9 percent in the surrounding areas.

The average asking rent for new rentals of existing apartments across Germany rose by 1.8 percent year-on-year and is now 8.57 euros per square meter. In the metropolises, Düsseldorf (+8.4 percent) and Frankfurt am Main (+6.8 percent) are the front runners in terms of price increases. Prices in Cologne have also risen above average compared to the other eight metropolises (+6.2 percent).

In Leipzig, the asking rents for new rentals of existing apartments have increased by 6.1 percent within a year and are at 8.49 euros. In Hamburg, the annual price increase of 3.7 percent to 13.80 euros is the lowest in a metropolitan comparison.

In a year-on-year comparison, Berlin also recorded growth of 6.4 percent, but the situation is different in a quarterly comparison: the asking rents even fell slightly (-0.6 percent), but are still high at 14.11 euros per square meter.

Leipzig is showing the strongest momentum in the new construction segment: Asking rents there rose by 12.7 percent year-on-year and by 3.9 percent quarter-on-quarter to an average of 13.09 euros per square meter. Despite the increase, the city remains the cheapest among German cities.

The highest asking rents for new apartments are in Munich (25.68 euros), Berlin (20.11 euros) and Frankfurt am Main (18.35 euros). Of these three cities, the price development in the Main metropolis is the strongest – both quarterly (+1.4 percent) and year-on-year (+7.8 percent). Berlin is the only city where prices hardly move at minus 0.3 percent.

A special evaluation by Immoscout24 sheds light on rent developments in large cities with fewer than 600,000 inhabitants. While prices in major cities rose by an average of 6.1 percent year-on-year, they rose even more sharply in cities such as Nuremberg and Essen, at 11.5 and 8.7 percent, respectively. Demand is also growing: more and more people are looking for an apartment, especially in Dresden (+34 percent) and Bochum (+21 percent).