Rising real estate prices year after year – with no end in sight. Especially the Housing shortage is being blamed for the steep rise in rental and purchase prices. And it is no longer just the business locations of Munich and Frankfurt that have been affected by skyrocketing real estate prices, but also the capital of the Federal Republic of Germany. However, we will explain in the following article that it is still possible to find affordable living space in Berlin and that a thorough search can definitely pay off, as well as looking at the most popular districts and their development and forecasts.
How are the real estate market and real estate prices currently developing in Berlin?
The development of property prices in Berlin since 1990 has been blessed with almost constant new records, with only a few exceptions. Although growth has not been quite as strong since 2017, the trend is still steadily upwards. The continued low interest rates in 2021 and Berlin’s population growth make the city one of the top real estate locations in Germany – and coronavirus does not appear to have put a noticeable damper on this either. However, many forecasts suggest that the rent cap adopted in 2020, in which legal regulations on rent caps were agreed, could favor at least a slight decline in prices.
However, Berlin should not expect a bubble to burst any time soon – an important indicator of Berlin’s popularity as a real estate location is its extremely low vacancy rate of 0.8% and building land remains in high demand.
The development of real estate prices in Berlin in figures
Let us now take a look at the statistics, which show that, with a few exceptions, the value of Berlin real estate has grown steadily since 1990. It is worth taking a closer look at the long-term performance of real estate in particular, as it is less dependent on external influences than shares or interest rates, for example – it is also considered inflation-proof, as it generally retains its real value.
Since 1991, when turnover from property purchases amounted to EUR 3,739 million, this has tripled to EUR 18,133 million by 2015. Declines in sales and therefore property prices in Berlin were recorded in 1995, 1997 and again significantly in 2008, the year of the financial crisis. Since 2010, however, sales generated with rising real estate prices have been on a steep upward trend in Berlin – and have repeatedly broken their historic high over the course of 10 years.
What are the current average real estate prices in Berlin?
How much do condominiums cost in Berlin?
In 2020, a square meter of new construction in Berlin cost an average of EUR 6,597 and EUR 4,909 for existing properties. These figures have already risen to EUR 7,800/m² and EUR 5,120/m² within a year.
How much do detached houses cost in Berlin?
For the purchase of a house with approx. 100 square meters of living space, an average of around EUR 5,758.79/m² had to be calculated in Berlin in December 2021. For a house with 150m², around EUR 5,166.27/m² had to be paid in Berlin at the same time. For a house with 200m² of living space, it was EUR 5,985.62/m² in December 2021.
Real estate prices by map: What is the situation in the individual districts?
In the individual districts of Berlin, we concentrate on the average prices per square meter for existing condominiums, as these reflect the attractiveness of a district and the demand there.
Charlottenburg
In the Charlottenburg district south of the Spree, property prices are developing similarly well to the rest of Berlin, although there are regional differences. Condominiums were sold for an average of EUR 5,520/m² in 2021, but prices in the district, which is characterized by urban villas, can be as high as EUR 10,000, while lower prices of around EUR 4,000 per square metre are realistic in the northern commercial district of Charlottenburg North.
Wilmersdorf
At EUR 4,100 per square meter for an existing property, property prices in Wilmersdorf are in the middle segment, but have not risen quite as rapidly as in other districts.
Friedrichshain
Berlin-Friedrichshain, on the other hand, is one of the districts with the strongest increase in property prices – between 2016 and 2017 alone, the standard land value roughly doubled from EUR 1,097 to EUR 2,100, which now stands at EUR 4,223 per square meter. The average price for a condominium in 2021 was EUR 5,180/m² – so you should not expect a bargain in Friedrichshain.
Kreuzberg
Similar to Friedrichshain, there has also been a significant increase in Kreuzberg – prices for condominiums have risen by 240% from EUR 2,000 in 2009 to EUR 4,700 per square meter in 2019 – in 2021, they are already at EUR 6,510/m², making Kreuzberg one of the most sought-after districts in Berlin – especially among young people.
Lichtenberg
With EUR 3,450 per square meter for condominiums in 2018 and an increase to EUR 4,560/m² in 2021, Lichtenberg is not in the upper price segment, but has followed the general trend in Berlin’s property prices.
Marzahn-Hellersdorf
The districts of Marzahn and Hellersdorf, which used to have a rather negative image, are among the cheapest districts in Berlin with an average of EUR 3,590 per square meter for condominiums in 2021 and are therefore increasingly popular with young families in particular, but property prices here also rose by 15.5% compared to the previous year, albeit at a slower rate than in other districts.
Berlin-Mitte
Condominiums in Berlin-Mitte cost an average of EUR 5,458 per square meter in 2019 and have doubled since 2009 – and could rise again in 2021, when average property prices for condominiums will amount to EUR 8,160/m².
Neukölln
Neukölln, which borders Kreuzberg, is also one of Berlin’s up-and-coming districts and achieved average property purchase prices of EUR 4,480/m² for condominiums in 2021 – thanks to the numerous new businesses and jobs that are increasingly transforming the district into a hotspot for young entrepreneurs and start-ups.
Pankow
The East Berlin district of Pankow offers its more than 400,000 residents elegant city villas and modern new buildings – but with an average price per square meter of 4,490 euros for condominiums, the rise in property prices has recently leveled off considerably.
Reinickendorf-Tegel
Berlin-Reinickendorf, which is often pushed into the background, could become the focus of investors in the future in particular, as fresh investment in research, production and housing, such as in the Urban Tech Republic at the former Tegel Airport or Siemens’ high-tech campus, will make the district increasingly interesting and property prices are likely to rise – in 2021, they will be EUR 3,920/m² and still belong to the lower mid-range.
Spandau
Growth is also predicted for Spandau – with EUR 4,040/m² for condominiums in 2021 and a 19.80% increase in real estate prices compared to the previous year, this is also making itself felt on the housing market.
Steglitz
Even if the Berlin Steglitz district has replaced its bourgeois and quiet image with a dynamic and modern one, the many green spaces and shopping facilities continue to contribute to the district’s attractiveness – as far as condominiums are concerned, prices per square meter rose sharply in 2019, reaching EUR 4,630/m² in 2021.
Zehlendorf
With over 50 % water and forest area, Zehlendorf is a noble center of quality of life in Berlin and also extremely popular with tourists – this is also reflected in the real estate prices, which at 5,490 EUR/m² for condominiums are exceptionally high for a district outside the center of Berlin.
Tempelhof
With average property prices of EUR 4,110/m² in 2021 for condominiums and despite its proximity to the city center, Berlin-Tempelhof can still be described as an insider tip for affordable and central living.
Schöneberg
Good transport connections and an exciting pub and cultural scene, even during the coronavirus pandemic, speak for Schöneberg’s laid-back image. However, at EUR 5,380/m² for condominiums in 2021, property prices are in the upper range.
Treptow
The sustainable and modern development of the district is also causing property prices to rise – they averaged EUR 4,210/m² in 2021, representing year-on-year growth of 17%.
Köpenick
Property prices in neighboring Berlin-Köpenick are also on the rise. On average, they will amount to EUR 4,620 per square meter in 2021 – with growth of 19.50% compared to 2020 – making the location one of the most promising in the capital.
Forecast: Will real estate prices in Berlin rise or fall?
Although Berlin’s districts are experiencing varying levels of growth, they are all following the trend of rising real estate prices, which are unlikely to fall in the foreseeable future. The only dampener for long-term forecasts up to 2030 are potential new legal regulations – but the unbroken high demand and the continuing shrinking supply make attractive increases in value possible even after 2021. A crisis or even a bubble are currently unlikely on the Berlin real estate market and the outlook gives hope that real estate prices will continue to develop positively.
