Even in the midst of a pandemic, the real estate market is not allowing itself a breather. On the contrary, prices are climbing faster than before - possibly precisely because people are spending a lot of time at home. But this is not having the same consequences everywhere.
Despite the Corona crisis, purchase prices for residential property in Germany rose significantly last year. On average across all regions, prices for existing condominiums rose by 9.6 percent in 2020 compared to the previous year, adjusted for inflation - and thus even more strongly than in 2019, according to Postbank's "Residential Atlas". According to the report, property prices rose particularly in metropolitan regions; Munich remained the most expensive city.
Overall, residential property became more expensive in a good 94 percent of all German districts and independent cities, according to the data. "Corona and the experience of the lockdown have intensified the desire for home ownership among many people," explained Eva Grunwald, head of Postbank's real estate business. "Many prospective buyers who were looking around the housing market last year were prompted to act by Corona in the first place. Demand isn't slowing down."
According to Postbank, "Germany's most expensive place" remained Munich - and by a wide margin: on average, buyers there had to pay 8613 euros per square meter for a condominium in 2020, 6.1 percent more than in the previous year. This means that the Bavarian capital was eight times as expensive last year as Dessau in Saxony-Anhalt, the cheapest independent city in Germany at 1046 euros per square meter.
Most expensive county is in the north
The second most expensive city was Frankfurt am Main with a price per square meter of 6050 euros. Hamburg followed in third place at 5569 euros - here the year-on-year increase was particularly high at 9.7 percent. This was followed by Berlin at 4973 euros.
The bank also identified particularly high real estate prices and, in some cases, double-digit year-on-year growth in the suburbs of large cities. "In the Corona crisis, people experienced that it can quickly become cramped in a city apartment and that the trendy urban neighborhood in the lockdown no longer seems quite so appealing," explained Grunwald.
One consequence: Germany's ten most expensive districts with prices per square meter of more than 5,000 euros in 2020 were almost without exception in Bavaria - including most of the area around Munich. The high prices there "drag the surrounding area along," Postbank explained. The most expensive district nationwide, however, was in the north: In the Nordfriesland district, which includes the islands of Sylt, Föhr and Amrum as well as the resort of St. Peter-Ording, a square meter apartment cost an average of 6796 euros.