German home prices rose by 1.9% year-on-year in Q4 2024, marking the first increase since 2022, according to the federal statistics office. Compared to the previous quarter, prices saw a modest 0.3% rise. However, uncertainty persists due to recent borrowing cost increases.
The housing market downturn began in 2022 when the European Central Bank raised interest rates to combat inflation, triggering Germany’s most severe real estate crisis in decades. While price declines have slowed, concerns remain, particularly for the broader property sector, including office spaces.
Prices rose in most areas, except sparsely populated rural districts, where apartment prices fell by 1.2% and single- and two-family houses dropped by 0.9%. In Germany’s seven largest cities—Berlin, Hamburg, Munich, Cologne, Frankfurt, Stuttgart, and Düsseldorf—apartment prices increased by 1.6%, and house prices rose by 1.1% year-on-year. However, apartment prices in these cities declined slightly (-0.3%) compared to the previous quarter, while single- and two-family homes saw a notable 3.9% increase.
In independent cities outside major metropolitan areas, apartment prices rose by 2.5%, and houses increased by 2.2% year-on-year, with both segments recording a 0.2% quarterly rise. The statistics office noted that figures remain preliminary as data revisions are underway.