Germany housing market: Rising rents and renovation costs

The German housing market is facing significant financial pressures. According to the Kiel Institute for the World Economy, rental prices for available apartments rose by 1.2 percent in the third quarter compared to the previous quarter, marking the strongest increase since early 2024. In a year-over-year comparison, rents in Hamburg saw the highest increase at 6.7 percent, while Berlin and Düsseldorf also experienced notable rises of 2.1 percent and 2 percent, respectively.

In addition to rising rents, a study coordinated by the Karlsruhe Institute of Technology (KIT) highlights concerns regarding energy efficiency. The survey of 3,000 households found that 65 percent of all respondents, and 75 percent of tenants, consider the costs of energetic renovations to be financially unfeasible. Approximately three-quarters of those surveyed also anticipate significantly rising energy costs.

A Forsa survey conducted for the German Tenants' Association and the German Trade Union Confederation indicates strong public support for stricter regulations. Approximately 89 percent of respondents in major cities support harsher penalties for landlords charging exploitative rents, while 75 percent favor tightening the rent brake.