Increasing demand from international investors, including Britons, looking to acquire residential property in Berlin is placing upward pressure on home prices in the city, with growth of up to 20% by 2018 forecast by Ziegert, Berlin’s largest estate agent.
The company’s latest condominium report reveals greater demand from foreign buyers is contributing to significant growth in house prices across the city, with inner city districts such as Tiergarten, Charlottenburg and Friedrichshain-Kreuzberg increasingly popular.
The study found that Berlin’s trendy Mitte district has experienced an increase in population of 30,000 since 2011, the highest in the capital, with almost half of the population - 44% - moving there from abroad, helping to boost sales in the city, particularly in the luxury segment of the market.
In fact, there are now more people moving to Berlin from abroad than from Germany, supported in part by the city’s growing tech economy – a key driver of residential sales prices – according to Ziegert.
Berlin has created 11,000 new jobs in the tech sector since 2011, more than any other German city, and is now considered Europe’s second most important city for start-ups, according to EY research, with venture capital invested in Berlin having exceeded $2.3bn (£1.85m) in 2015, compared with $1.9bn (£1.5bn) in London.
The city’s reputation as a leading tech hub is being further strengthened with the development of Media Spree, Berlin’s largest urban development covering 180 hectares in the heart of the city. An estimated 40,000 new jobs - predominantly in the tech sector - and 8,500 new homes are being planned as part of the project.
Additionally, Mercedes Benz will relocate its R&D operations with 1,200 jobs while Germany’s biggest online fashion retailer Zalando is building a new campus for its 15,000 employees.
Nikolaus Ziegert, founder and managing director of Ziegert Bank- und Immobilienconsulting GmbH, sais: “Berlin’s burgeoning tech sector is spurring a new swathe residential development in the city, as international investors realise the income potential inherent in the local market.
“Recently rated as a top investment destination for global venture capitalists, Berlin is increasingly popular with technology; media and telecoms start up firms, attracted by low commercial rent prices and a conducive business environment.”