Market Analysis
Berlin apartment market 2013
One in four Berliners wants to move and is considering buying
A TNS Infratest survey found that one in four Berliners was planning to move. Rising rents were making homeownership a realistic alternative for many.
Peter Guthmann
The Berlin property boom was not just driven by outside investors. A survey by TNS Infratest, commissioned by Wüstenrot & Württembergische, revealed that one in four Berliners was planning to move. The main reason: the financial burden of rising rents.
38 percent of income spent on rent
More than a third of Berlin households said they could not absorb another rent increase. On average, 38 percent of household income went toward rent and utilities, roughly four percentage points above the national average. In sought-after areas such as Mitte, the figure was even higher.
This pressure prompted many Berliners to think not just about switching apartments, but about fundamentally different ways of living.
Owning instead of renting
When monthly rent keeps rising, people start running the numbers. For many Berliners, buying an apartment became a realistic option. The logic: better to put the monthly payment toward building your own equity than toward someone else's property. Ownership offers the kind of long term planning certainty that a rental agreement cannot provide, especially when rents rise faster than incomes.
This trend was not limited to buy-to-let investors in 2013. Owner-occupiers were increasingly entering the market as well.
The detour via a rented-out apartment
An interesting approach many Berliners took: they bought an apartment at the current price, rented it out initially and planned to move in later. Rental income covered part of the financing, and the buyer locked in a price before further increases. Those who went this route used the investment apartment as a stepping stone toward their own home.
What this meant for the market
Strong local demand was a stabilizing factor for the Berlin property market. The desire for homeownership came not only from international investors but from Berliners themselves. That created broad, locally rooted demand, visible even in up-and-coming areas such as Neukoelln. For owners, it meant stable values. For investors, it meant demand that did not depend solely on economic cycles.