Berlin: rents keep rising

Last year, the rents in Berlin have increased on average by 4.5 percent. In the two-year comparison, rents soared, up nearly ten percent higher. This is from the residential market report presented yesterday by the housing company, GSW and the consulting firm CB Richard Ellis (CBRE).

"The Berlin housing market is very attractive," concludes GSW-chief Thomas Zinner. The main reasons for rent increases are according to CBRE evaluator Michael Schlatterer the low construction activity in recent years and the significant increase in the number of households. According to the report on the Housing Market by IBB also published this week ,
there are currently 165,000 households more in Berlin than a decade ago.

While  in suburban municipalities such as Spandau and Marzahn-Hellersdorf the rents are stagnant or falling, the rents explode in desirable downtown locations. In the center, they rose in a single year by 13.7 percent, in Charlottenburg-Wilmersdorf by 10.7 percent. The existing tenants were not taken into account , but only the rents asked by owners in published ads.

Just a few miles lie between the areas, but rents separated worlds.
 The upward trend is confirmed by further investigations. Jones Lang Lasalle (JLL) estimates the average rent increase in the second half of 2010 to 3.6 percent. Also according to the research institute Empirica apartment rents are rising in Berlin as strong as in no other German city.

Nevertheless, living on the River Spree is still much cheaper than in Hamburg or Munich: the average for new leases of GSW-residential market report put at € 6.11 per square meter.

The development of the housing market attracts investors. "Berlin is by far the largest apartment building market in Europe," says CBRE expert Schlatterer. Here, the investors are willing to pay higher prices again: The price per square meter of apartment buildings took last year to an average of 4.1 percent. Nevertheless, observers see no sign of overheating of the market. "Investors are currently buying a particular quality," says Schlatterer.

"But we have no housing shortage," said GSW head Zinner. "Especially in the lower segment the rents are still very tolerable." Other market participants see the not so relaxed: "Also the former low-price locations are getting more expensive," according to JLL. And the Association of Berlin-Brandenburg housing company wants the Senate to present a strategy how approximately 60,000 new dwellings can be built until 2020.