Real estate prices continue to skyrocket: districts around Munich are particularly affected

Created: 03/26/2022, 08:51

By: Catherine Brown

Real estate prices will continue to rise significantly in 2022.

© Bernd von Jutrczenka/dpa

Real estate prices have skyrocketed in the second Corona year.

Nine of the ten most expensive districts are in the Munich area.

Munich - Munich* is still the most expensive city in Germany - but real estate prices in the surrounding area are also climbing to record values: In the Munich bacon belt, condominiums* are now more expensive than ever.

This is the result of the new "Postbank Housing Atlas 2022".

Nine of the top 10 most expensive districts in Germany are in Upper Bavaria – in North Friesland on the North Sea alone, square meter prices are slightly higher.

The second year of Corona has driven up prices for condominiums throughout Germany: in 2021 they rose by an average of 14.2 percent.

The previous year the increase was 9.6 percent.

The reasons for this were persistently low interest rates and unrestrained demand.

"The new records on the real estate market are favored by the fear of a rise in interest rates and rising inflation," says Eva Grunwald from Postbank.

Many people have therefore invested in real estate - especially since the pandemic has increased the desire to own a home.

Rental market in the Munich area: Prices in the surrounding area are rising more than in the cities

Of the ten most expensive districts in Germany, the prices for condominiums in Miesbach* have risen the most: In 2021, 7973 euros per square meter were paid here.

This is an increase of 14.9 percent compared to the previous year.

Not even in the state capital have prices risen so sharply: At around 9730 euros per square meter, the apartments in Munich are almost 9.8 percent more expensive than in 2020. In the districts of Ebersberg (14.2 percent), Freising* (12.1 percent) and in Garmisch-Partenkirchen* (10.9 percent) prices have increased significantly more than in Munich.

Only in Starnberg (6.2 percent) has the increase weakened somewhat compared to the previous year.

According to the Postbank experts, the price gap between metropolises and their surrounding districts is shrinking: in Berlin, for example, the plus for condominiums was 8.1 percent in 2021 - in the Oder-Spree district, on the other hand, it was 45.2 percent.

Potsdam is now almost as expensive as Berlin, but prices have increased by 27.3 percent.

Interested parties would have to “take a close look,” says Grunwald.

Real estate prices: Germany's most expensive cities - high increase even in large cities that have been cheap up to now

Because of the high prices in the most important metropolitan regions, other major cities are now coming into focus, according to the housing atlas.

Potsdam, Freiburg im Breisgau and Heidelberg are now also among the most expensive cities in Germany – all three have exceeded the 5000 euro mark with their square meter prices.

In general, condominiums in large cities will be twelve percent more expensive in 2021 than in 2020.

Real estate prices have increased significantly, especially in the big cities in eastern and central Germany: by around 29.5 percent in Erfurt and by almost 22 percent in Chemnitz.

But: Compared to other German cities, condominiums are still cheap here.

In Chemnitz, for example, buyers pay EUR 1,671 per square meter, only around a sixth of the Munich level.

Apartments in Magdeburg are available for 1984 euros per square meter.

Real estate prices continue to rise: Experts recommend medium-sized cities

For those interested, it is worth taking a look at cities with 20,000 to 100,000 inhabitants: "Centers with short distances, neat inner cities, good infrastructure and proximity to the green surrounding area attract property seekers," says Grunwald.

However, the supply in such cities is often lower - which is why prices have risen significantly here as well.

In Bavaria there were particularly high increases in Hof, Amberg, Kempten and Passau.

The university town of Hof is therefore still "affordable" at 1884 euros per square meter - in Kempten in Allgäu, however, buyers have to pay 4000 euros.