Market Analysis
Berlin population forecast
Senate forecast: Berlin to grow to 3.8 million residents by 2030
According to the Senate, Berlin's population will increase by around 7% to nearly 3.8 million by 2030. At the same time, households are getting smaller. Both factors increase demand for apartments.
Peter Guthmann
The Senate Department for Urban Development and the Environment expects Berlin's population to grow by around 7% by 2030. Starting from approximately 3.5 million residents at the end of 2011, that would mean nearly 3.8 million people. This alone would put pressure on the housing market. But there is a second factor.
More people, smaller households
Average household size in Berlin is falling. There are more one- and two-person households, more students, more singles, more commuters. This means that even without population growth, Berlin would need more individual housing units. Combined with the influx of new residents, the effect multiplies. Demand is particularly strong for compact, well-connected apartments within the S-Bahn ring.
New construction cannot keep up
Housebuilding activity in Berlin is currently unable to match growing demand. The market for small and affordable apartments is already tight. Vacancy rates are falling and rents are rising. Boroughs such as Friedrichshain-Kreuzberg and Neukoelln, which are particularly popular with newcomers, are feeling the pressure.
The Senate has announced 38,000 new apartments by 2025 under the Urban Development Plan Housing. Whether these plans will be implemented at the pace demand requires remains to be seen. Market data shows a clear demand surplus in any case.
Compact apartments near universities are the structural winners
3.8 million residents by 2030 plus shrinking household sizes feed each other, which makes Berlin's demand floor a structural one rather than a cyclical bet. Residential investment property within the S-Bahn ring captures the strongest pull. Locations with good infrastructure and proximity to universities, such as Oberschoeneweide near the HTW or Mitte, offer stable lettability through the target group of students and young professionals.
