Real Estate Prices in Germany Falling Sharply

In 2023, real estate prices in Germany fell sharply. Researchers have already called this phenomenon unique. tagesschau.de writes about it.

As Tagesschau reports, based on the results of the research of the Institute of World Economics in Kiel, the prices of residential buildings decreased by 8.9%, private houses – by 11.3%, and houses intended for several families – by 20.1%.

For the last 60 years, real estate prices in Germany have only increased. Now the trend has changed in the opposite direction. The German publication writes that such an accelerated decline in prices has not occurred since the 1960s.

According to Tagesschau, real estate prices fall unevenly according to women. At the end of 2023, the decline has somewhat slowed down and the 7 megacities (Berlin, Dusseldorf, Frankfurt, Hamburg, Cologne, Munich, Stuttgart) have different dynamics. In the last quarter, condominium prices fell by 3.6% in Cologne and Stuttgart, while Berlin, Frankfurt and Hamburg remained almost unchanged.

According to IfW President Moritz Schularic, the drop in prices will lead to lower interest rates on bank loans, which will reduce the cost of construction and stimulate demand for real estate.