A growing number of property investors are attracted by rising residential property prices in Germany’s main cities, supported largely by high demand for housing, Germany’s strong economy, low borrowing rates and falling unemployment levels, research shows.
Home prices in Germany’s big cities have continued to surge ahead, with apartments in Munich, Berlin, Hamburg and Frankfurt now costing the equivalent of 10 to 15 years' earnings, according to a study for the German Postbank.
Figures show that apartment prices in Hamburg, for instance, have risen by 70% between 2010 and 2015 which is impressive given the European Union’s ongoing economic woes.
Yet, despite recent growth, apartment prices in Hamburg are forecast to surge by another 50% by 2030.
For many investors, property in Germany now looks like an attractive income investment at a time of low saving rates and stock market volatility, with returns beating nearly all other mainstream investments in the country.
Although most people still rent their homes in Germany, high tenant demand means that rents are rising across much of the country, particularly in the large cities; an attractive proposition for property investors.