Germany for sale: Why the cost of living in Germany is on the rise


In towns and cities across Germany, rental prices are climbing steadily and real estate is becoming a hot commodity for international investors. Sumi Somaskanda and Nina Haase took a look at the situation in Berlin.

”Germany is a nation of renters, not homeowners. Almost 50 percent of Germans rent their homes; the EU average is only at 30 percent.”

Buy in Germany

More and more people are moving into cities and rural areas are emptying out. Germany is seen as an attractive place to live and work, particularly among Europeans. Berlin has taken in 220,000 new residents in the last five years alone.

“They arrive in cities and the demand there is enormous – the population rise is massive,” says Claus Michelsen at the German Institute for Economic Research (DIW). “That’s why rents are rising significantly, but also real estate prices. And there are simply too few apartments.”

The German capital is bursting at its seams with a vacancy rate of only 1.5 percent. That is why there has been something of a building boom in Berlin.

Across town, towering cranes have become a familiar backdrop to the skyline. Yet they will do little to lower the rents. Many of these new buildings are apartments for sale, not to rent. And they are so expensive that they are only for those seeking to invest in the luxury and premium market.

Meanwhile the German real estate market is becoming a globally sought-after brand – a stable economy and safe harbor for foreign investors keen to park their money.

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