Market Analysis
Berlin housing market report 2015
Housing market report 2015: first signs of price stabilisation in Berlin
Berlin's property market showed first signs of consolidation in 2015. Listing prices peaked at EUR 3,663 per sqm at mid-year and eased to EUR 3,426 by year end.
Peter Guthmann
After years of rising prices, Berlin's housing market took its first breath in 2015. The annual housing market report, presented in mid-March, points to a shift that does not yet qualify as a turnaround, but no longer fits the old upward spiral either.
Prices: peak at mid-year, slight correction afterwards
The average asking price per square metre hit a preliminary high of 3,663 euros in mid-2015. By year-end it had eased to 3,426 euros, somewhat below the mid-year level. New developments stayed clearly above this benchmark at an average of 4,343 euros per square metre.
The shift toward the upper price segment continued through 2015. Sixty-four percent of all listings were priced above 3,000 euros per square metre. That number describes mainly the inner-city boroughs, though. In Spandau and Marzahn-Hellersdorf, price levels remained noticeably lower.
Building permits at 1990s levels
In parallel, the Berlin-Brandenburg Statistics Office reported 22,365 approved apartments for 2015. That is 16.5 percent more than in 2014 and the highest figure since the 1990s building boom, which peaked at 29,457 permits in 1995.
The strongest growth came from work on the existing stock. Loft conversions and changes of use added 4,430 apartments, an increase of 56.1 percent year over year. A further 17,935 apartments will arise as genuine new construction, a third of them as condominiums. Almost 90 percent of all approved units are being built within apartment buildings. Most permits went to Treptow-Koepenick, Mitte and Lichtenberg.
What the movement tells us
A single quarter with slightly softer per-square-metre prices is not a turning point. From our perspective, the report nonetheless shows two things at once: willingness to pay in the upper price segment is not unlimited, and at the same time, more supply is reaching the market than at any point in recent years.
For Berlin's market for apartments for sale, this changes the signs. Anyone who bought in recent years has profited in almost any location. If you are now planning an investment, the look at micro-location and building condition matters more than it did even two years ago. This is exactly where an experienced Berlin real estate agent earns their keep, by being able to demonstrate the difference between a sound asset and one that is merely expensive.
