Rising interest rates and high construction costs make home ownership unaffordable for many families. This is now also evident in the real estate market. Especially in the metropolises, the supply of real estate for sale is increasing immensely - at the same time, rental apartments are even more fiercely contested.
The real estate market is undergoing major changes. While offers for purchase properties on the Immoscout24 platform experienced a boom in July, the offer for rental apartments fell significantly. "With the rise in interest rates in the second quarter, financing a property purchase has become significantly more expensive," said Thomas Schroeter, Managing Director of Immoscout24, according to the announcement. "For many people, the dream of owning their own property has been shattered for the time being."
The range of properties for sale on Immoscout24 increased in all major cities in July: the strongest in Munich (plus 18.5 percent). But also in Dusseldorf (plus 15.6 percent), Cologne (plus 14.4 percent) and Stuttgart (plus 14.2 percent) the range of properties for sale grew significantly. For all of Germany and Berlin, Immoscout24 recorded "only" around nine percent more advertisements for properties for sale in July than in June. In a metropolitan comparison, the development of supply is the lowest there.
"People who previously thought about buying are now increasingly looking for properties to rent," says Schroeter. "The shift in demand from purchase to rental has continued to worsen in just one month." The development in the federal capital is particularly striking. There, the already very high demand for rental apartments rose by 31 percent within a month. On average, an advertisement for an existing rental apartment in Berlin receives 168 contact requests per week.
The rental market is also fiercely competitive in other German metropolises. In Munich, Immoscout24 recorded the second-strongest increase in demand for rental apartments in July, with an increase of around 17 percent. At the same time, the supply of rental apartments fell in all major cities: most notably in Berlin (minus 12.6 percent), Cologne (minus 10.8 percent) and Frankfurt am Main (minus 10.0 percent).
According to the portal, one exception to the development of the rental market is new-build rental apartments: In most metropolises, the supply for this is still on a slight growth course. In some places, however, the supply of new rental apartments is already declining - for example in Frankfurt am Main (minus 12.6 percent) and Cologne (minus 10.0 percent). "We need more supply," explained Schroeter. Due to the delivery bottlenecks and enormous cost increases in new construction, the federal government will not be able to achieve its goal of 400,000 new apartments per year this year.
