BERLIN INVESTMENT HOTSPOT WITH 52% MARKET SHARE
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The persistently challenging market environment continued to have a dampening effect on the German residential investment market in the first quarter of 2024, although the consolidation phase that has been evident since 2022 is now likely to have come to an end. Across Germany, €771 million was invested in larger residential portfolios (30 residential units or more) in the past three months. This was 33% below the result for the same quarter of the previous year and 85% below the long-term average.
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The Big Six cities account for a significantly above-average share of almost 60% (Ø 10 years: 46%) and thus clearly dominate the transaction activity on the German residential investment market. However, this high market share of the six largest cities is mainly driven by the German capital: Berlin is responsible for 52% of the total volume with a turnover of around €403 million. Even though sales are slightly down on the same quarter of the previous year (€546 million), the market share is well above the long-term average (26%). A forward deal worth €225 million concluded by a US investor in Berlin-Neukölln sends a strong signal. Opportunities like these emphasize the confidence in the German capital and the good medium as well as long-term prospects on the German residential property market.
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Of the other A-locations, only Düsseldorf, Frankfurt and Hamburg can report significant volumes, with market shares in the low single-digit percentage range in each case.