Berlin is in the green - at least as far as the Postbank is concerned. For the first time, experts are forecasting considerable increases in value for real estate investments in the German capital by 2030. Since 2013, economic research institute Prognos has been analyzing the growth prospects for real estate investments on behalf of the Postbank, as part of a series of studies on home ownership. The result of this year's study: real estate owners in around half of all 402 German towns and municipalities can expect to make a profit if they sell in 2030. A further quarter of all municipalities promise stable continued growth at least.
Until recently, Berlin was also in the mid-range of this stable growth. Just last year, the capital was marked yellow in the list of all municipalities. Not any more: dark green shows that the experts are forecasting good future values and decent growth in real estate prices for the booming metropolis too. While Berlin only advanced to number 26 in the latest site rankings, headed up by Hamburg (first place) and Munich (second), the capital is now firmly in the fast lane and for the first time can compete with the value growth in the regions in the south of Germany. The main indicator for these increased values is rapid population growth, leading to expectations of stable to growing demand for residential property. The study by the experts at Prognos also included additional factors such as disposable income, average age, job market prospects and the number of people receiving benefits. Here, too, the indications for Berlin show strong upward growth.
According to the Postbank study, apartments in Mitte, Friedrichshain-Kreuzberg and Charlottenburg-Wilmersdorf are in particularly great demand. Purchase prices here are also comparably high. According to the experts at Postbank, real estate purchasers in Mitte will generally have to allocate more than 40 percent of average net average income per household for interest and repayments. By comparison, only around 20 to 30 percent of income goes towards financing in locations on the outskirts of the city. According to the study, however, the value for inner city locations in Berlin remains within reasonable bounds and as a rule, experts consider a monthly installment of 20 to 40 percent of total income, with an equity capital share of 20 percent, appropriate.
So, investing in Berlin city-center properties is well worth it: under current financing conditions, purchasers of a 70m² apartment in Mitte will save between Euro 100 and 150 on average compared to renting - every single month. Only in some parts of Zehlendorf is the potential for savings even greater: here, owners pay around 305 Euro per month less than those renting. In addition, the chances that the property will significantly increase in value by 2030 are good.
Currently, potential buyers have the greatest choice in the Westphalian quarter and around Nordbahnhof in Mitte. Between Gartenstraße and Chausseestraße in particular, an entirely new quarter filled with a mixture of residential and office buildings has taken shape over the last few years. Attractions in this new neighborhood, aside from the ‘BeachMitte', a beach bar with beach volleyball and climbing, include the organic supermarket and a water playpark. Furthermore, now that the development work in Invalidenstraße has been completed after many years, this new quarter also has excellent transport links to the west of the city.