Real estate: Kiel Institute: weaker price increase for residential properties
Purchase prices for condominiums have generally increased more slowly. In some cities, such as Stuttgart and Frankfurt, prices are even falling.
The growth of property prices, including single-family homes and apartments, continues to weaken according to an evaluation by the Kiel Institute for the World Economy. In the second quarter, property prices increased by 0.3 percent compared to the previous quarter, with apartment prices rising by 1.8 percent. However, data for the second quarter is still not available from the Federal Statistical Office.
Among the eight most populous cities, apartment prices in Düsseldorf increased the most at 1.2 percent, while prices in Stuttgart fell the most at 1.6 percent. Specific figures for Berlin, Hamburg, and Munich were not available at this point. "While nominal prices are still rising, the surge has visibly lost momentum," said project leader Jonas Zdrzalek.
After accounting for inflation, property prices for apartments even fell by 0.9 percent compared to the previous quarter. This means that sellers may be achieving higher prices, but they cannot afford them as easily. The Kiel Institute usually evaluates quarterly transaction data from appraisal committees and creates the Greix Index, which contains data from over 20 major cities and three counties.
The Cologne Institute of the German Economy (IW) argued in late April that the Iran war is dampening property prices, citing rising interest rates resulting from the conflict. This would decrease the affordability of properties, thus limiting demand and constraining the room for price increases.
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