German rental prices rise sharply while buying homes becomes cheaper in many regions

The Postbank Wohnatlas 2026 shows that in 59 German regions buying a 70 m² existing apartment now costs a lower share of household income than renting – on average 17.2 % of income for mortgage payments versus 13.5 % for net cold rent. In 30 % of districts the purchase is very affordable, while 20 % of households live in areas where mortgage costs exceed 25 % of income.

The Institute of the German Economy (IW) reports that advertised rental prices rose by 4 % year‑on‑year in the second quarter of 2026, with the strongest gains in large cities such as Cologne (+7.9 %) and Hamburg (+5.5 %). The rental market is tight: the number of advertised apartments is about 12 % below the early‑2022 level, and in cities like Hamburg the supply has halved.

Overall the German housing market is split. Demand for rental units remains high while supply is constrained, pushing rents up faster than purchase prices, which have risen only modestly (around 0.8 % quarter‑on‑quarter).