Berlin Rents Rise Again – Strongest Growth in Neukoelln

Despite the introduction of a rental cap (‘Mietpreisbremse’) in 2015, rental prices in Berlin continue to rise, according to a new residential market report by Berlin Hyp and consulting company CBRE. In 2016 apartments were being offered at 9 EUR per square metre and month, a 5.6% increase on the previous year – and there are other significant changes to the market, as shown on the new Berlin Price Map and Berlin Rental Map from leading international estate agent Black Label Properties.

Berlin Housing Market Report 2017

Berlin’s population is growing rapidly and its housing market is developing dynamically. The city has a diverse scene that ranges from major projects by public housing experts to private developers and co-operative projects, to exclusive apartments in the centre aimed at international clients. Refugee numbers have had some impact on the statistics, but there are also professionals and families relocating to the city for quality of life and to study – free education being a key factor. In 2015 Berlin gained 48,000 residents, and since 2005 has grown by 270,000 people. There is plenty of planned construction (32,240 apartments) but this does not cover the influx.

Here are the key findings of the Berlin Housing Market Report:

Biggest growth in the outskirts of the inner city, i.e. districts with smaller apartments like Neukoelln (17% growth) and Marzahn-Hellersdorf (10% growth). Rapid growth in two Neukoelln postcode areas: Richardplatz and Silbersteinstrase where rents increased by 32% to 11.92 EUR within one year, and 24% to 11.17 EUR.
Strong growth in Humboldthain (Mitte) with rental prices rising from 47% to EUR 10.60 per square meter and month. “Such enormous deviations are explained by several new projects, which were let for the first time in 2016,” says Michael Schlatterer, Team Leader Residential Valuation for CBRE in Berlin.
Furnished apartments in inner city areas now account for 27.4% of the total rental offer. Landlords typically let these at an extra charge of 3-4 EUR per square metre, which helps them to get around the rent brake in certain circumstances. More than half of furnished apartments were rented in three inner city districts – Mitte, Charlottenburg-Wilmersdorf and Friedrichshain-Kreuzberg with ads for these accounting for 40% of rental housing offers.
Fewer empty apartments in the city – just 1.2%, slightly higher than Cologne and Stuttgart.
Price reductions in some areas – the biggest fall was in Kreuzberger Prinzenstrase at 16.8% to 9.26 EUR per month and square meter; Buelowbogen in Schoeneberg also fell 11% to a rent of 7.73 EUR.
Rents are currently highest in Hackescher Markt (Mitte) at 13.70 EUR and Unter den Linden at 13.38 EUR. Ahrensfelde (Marzahn-Hellersdorf) has the cheapest rents at 5.75 EUR.
Home ownership continues to be more expensive – because of the rise in prices there is more international interest in residential property in Berlin. The price for owner-occupied apartments rose by 9.6% to 3,289 EUR per square metre. The highest prices are in Mitte, Friedrichshain-Kreuzberg and Wilmersdorf; the largest increases in Spandau and Lichtenberg (23%) and Tempelhof-Schoneberg (21%).
“One of the key highlights of this report is the sustained growth of Berlin’s residential sector. Over the past few years investors have been shifting capital in increasing amounts into Europe’s most undervalued capital city,” says Ian Sigmund, Investment Associate, IP Global Ltd. “Whilst investment in previous years has been concentrated solely around more central locations such as Mitte, Charlottenburg and Friedrichshain, we are now seeing potential in Berlin’s outer districts. Lichtenberg is a prime example of a location that has been a recipient of this investment. In 2015 it saw a meagre 3.4% capital appreciation yet a strong leap in rentals, 8.7% a key indicator for future growth. Lichtenberg’s top market segment appreciated an astonishing 29.7% over the year 2016, with much of this growth attributed to areas surrounding the Tierpark.

“Looking ahead, this report solidifies the Berlin investment case with the average residential capital growth over all districts at a healthy 9.6%. With uncertainty surrounding traditional safe haven markets such as the UK and the US, Berlin remains an attractive alternative for investors in search of strong, sustainable returns.”

Where to invest in Berlin

The Berlin Price Map and Berlin Rental Map show you how much it would cost to buy or rent near every train station in Berlin. It is easy to see that the actual market price is much higher in practice compared to the average rental price of 10.84 EUR per square metre in many areas of Berlin despite the rental brake. Despite the higher prices, new buildings are now a better investment. This is reflected in the quality of the building, the contemporary housing the legal security in lettings and the foreseeable trend that the demand for new buildings will grow steadily over the next few years.

“We advise buy-to-let investors to buy properties that are new build or completely refurbished to avoid the rental capping law because the new restrictions to not apply there,” says Black Label Properties’ director Achim Amann. “A 3% yield for buy-to-let investors in Berlin for the new builds is realistic, but not more. Please look for areas where the rents are still cheap if you wish to invest into a capital growth. In the areas where renting is still cheap we see the best options for capital growth. More and more people will move there and then the rents will pick up. e.g. Spandau, Lichtenberg (last year) and south Neukoelln.”

The Housing Market Report Berlin 2017 is published by Berlin Hyp and CBRE and available to read in full here.

About Black Label

Black Label Properties is a leading Berlin realtor, international real estate agent, property surveyor, finance expert and lettings and property management agent. Our team speaks fluent English, German, French and Chinese. From our offices in Berlin we offer a full service package to individuals and companies looking to relocate to Berlin and we are one of the few agents who offer in-house finance brokerage for international clients. With 300+ properties for sale between 54K and 8.9M, we offer the largest selection in Berlin.

Black Label Properties works closely with IP Global to simplify property investment for international clients:

 

Written by Nicci Talbot.

EAN Content

Content shared by this account is either news shared free by third parties or sponsored (paid for) content from third parties. Please be advised that links to third party websites are not endorsed by Estate Agent Networking - Please do your own research before committing to any third party business promoted on our website. As an Amazon Associate, I earn from qualifying purchases.

You May Also Enjoy

Breaking News

Homeowners in England and Wales overvalue their properties by an average of 16%

Homeowners in England and Wales are overestimating the value of their property by an average of 16%, according to new figures. Data from Quick Move Now compares homeowner estimates with formal estate agent valuations and is broken down by both region and property type. Overall, homeowners overvalue in every single category.   Regional breakdown Region…
Read More
Visual blemishes on Roads due to service upgrades
Estate Agent Talk

Emergency Sidewalk Repairs: When to Act and Who to Call

Sidewalks are the unsung heroes of city infrastructure—quietly assisting tens of millions of footsteps every day. But when they crack, disintegrate, or shift all of sudden, they might quickly turn out to be volatile liabilities. In a town like New York, in which pedestrian site visitors are constant and belongings proprietors are legally chargeable for…
Read More
Breaking News

Reapit report reveals agents’ long-term market confidence amid legislative challenges

Despite the significant challenges posed by a shifting economic landscape and the largest wave of housing legislation in decades, estate and letting agents remain steadfast in their confidence about their long-term future in the industry. According to the first Reapit Property Outlook Report 2025, covering the full breadth of sales and lettings agency opinion countrywide,…
Read More
Breaking News

Owner-Occupiers Drive Resilient Commercial Property Market

Buying Becomes 37% Cheaper Than Renting The latest Commercial Property Demand Index from specialist property finance expert, Rangewell, reveals that while investor appetite across the sector held steady in Q2, strong levels of owner-occupied commercial mortgage activity are helping drive market performance, as business owners increasingly move from renting to buying their long-term premises for…
Read More
Breaking News

One year of Labour: Property market performance review

Investors left waiting for planning reform and incentives but majority plan to increase real estate allocation   Biggest failures: Lack of incentives for developers and investors, and ineffective planning reform Top priorities: Planning reform, tax incentives, and attracting international capital Where opportunities lie: Data centres, warehousing & logistics, and later-life housing Real estate debt is…
Read More
Estate Agent Talk

Plumbing Red Flags Every Homebuyer Should Watch Out For

Buying a home is one of the most significant investments a person can make. While factors like location, square footage, and curb appeal often steal the spotlight, what’s hidden behind the walls is just as important—especially the plumbing. Overlooking plumbing issues during the home-buying process can lead to costly surprises down the road. That’s why…
Read More