photo: Rupert Oberhauser/picture alliance
After growing by 3.2% in 2025, German residential real estate will appreciate by 3% annually over the next three years, according to a forecast by Reuters analysts and data from VALUE Marktdatenbank.
The market has started to recover from the prolonged downturn of 2022-2024. According to Destatis, house prices rose 3% on an annualized basis in the fourth quarter of last year. This marked the first annualized increase since 2022. At the same time, the market still has not recovered previous losses: average prices remain almost 10% below their peak levels in 2021, Prian reported.
The recovery has been uneven. According to the GREIX index, in the first quarter of 2026, apartment prices rose by only 0.5% year-on-year, while private houses rose by 3.2%. At the same time, the dynamics in the apartment segment is noticeably weaker than in the market of individual houses.
The gap is also noticeable between cities. The most expensive market remains Munich, where a square meter of secondary housing costs an average of 8,588 euros, and in new buildings – 11,237 euros. Next come Frankfurt and Hamburg. In Berlin, prices for ready housing for the year increased by 1.6%, while new apartments, on the contrary, fell in price by 0.6%.
Essen, Dortmund and Leipzig remain the most affordable among major cities.
Experts attribute further price growth primarily to the lack of supply. High construction and financing costs make many projects unprofitable, which limits the volume of new housing on the market.
According to a Reuters poll, housing prices in Germany will grow by 3.3% by the end of 2026, and in 2027-2028 will add another 3% annually. Analysts believe that the recovery remains fragile due to inflation risks and buyer caution.
