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Germany Residential Real Estate Market Analysis

The Germany Residential Real Estate Market size is estimated at USD 372.77 billion in 2024, and is expected to reach USD 499.84 billion by 2029, growing at a CAGR of greater than 3.06% during the forecast period (2024-2029).

The sale of residential property in Germany amounted to around EUR 3.7 billion (USD 4 billion) in the first half of 2023. This represented a decrease of 53% compared to the same period of the previous year and, at the same time, the lowest turnover in the first half of the year since 2011. In the year so far, there have been four transactions with volumes of more than a quarter of a billion euros each. These transactions accounted for 62% of the volume. However, according to the experts, about three-quarters of the sales were below EUR 50 million (USD 54 million).

However, several new building sales have been made public over the last few weeks and months, with multipliers exceeding 25 to 27 times annual rentals. Due to such benchmark transactions, the players have more certainty about the potential first yields in buying or selling.

The vacancy rate is already low in many cities and may worsen. Experts indicate that the number of completed units will be around 200,000 in a few years. The federal government has set a new construction target of only half that amount.

The timing may be suitable for owners willing to sell, while a favorable window of opportunity opens for long-term investors wanting to enter the market. The presence of equity investors in the market who stabilize prices, particularly for smaller and medium-sized properties, may favor early sales instead of waiting and observing. However, prices could fall again when this capital is used.

Germany Residential Real Estate Industry Segmentation

Residential real estate refers to land and any buildings for residential purposes. The most common type of residential real estate is single-family dwellings. A complete background analysis of the German residential real estate market, including the assessment of the economy and contribution of sectors in the economy, market overview, market size estimation for key segments, and emerging trends in the market segments, market dynamics, and geographical trends, and COVID-19 impact, is covered in the report.

The German residential real estate market is segmented by type (villas, landed houses, condominiums, and apartments) and key cities (Berlin, Hamburg, Cologne, Munich, and the Rest of Germany). The report offers market size and forecasts for all the above segments in value (USD).