Data published by the Kiel Institute for Economic Research showed that despite signs of price stabilization in the residential real estate market, the German housing market continues to experience difficulties amid high interest rates.
According to the report, in the 1st quarter, apartment prices fell by 0.7% QoQ, while prices for single-family homes remained unchanged. However, prices for multi-family homes fell by 10.5% QoQ, which is more than twice the rate of decline recorded in the 4th quarter of 2023. In annual terms, apartment prices decreased by 5.4%, prices for single-family homes fell by 5.3%, and prices for multi-family homes decreased by 16.4%.
"It is too early to talk about reaching the bottom in the residential real estate market. The persistently low number of transactions means that markets are quite volatile regionally," the Kiel Institute said, adding that from January to March 2024, the average number of sales in all residential real estate segments was only about 40% of the average from 2019 to 2021.