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Residential Real Estate Transactions - Germany

Germany

Germany's Residential Real Estate Transactions market market is projected to reach a transaction value of €203.80bn in 2024.
It is expected to exhibit an annual growth rate (CAGR 2024-2029) of 1.67%, leading to a market volume of €221.40bn by 2029.
The German residential real estate market is experiencing a surge in demand due to low interest rates and a strong economy.

Key regions: Germany, Europe, Asia, United States, United Kingdom

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Analyst Opinion

The Residential Real Estate Transactions market in Germany has been experiencing steady growth in recent years.

Customer preferences: Customers in Germany have shown a strong preference for residential real estate as an investment. This is due to several factors, including the stability of the German real estate market and the potential for long-term appreciation. Additionally, the low interest rate environment in Germany has made real estate investment more attractive compared to other investment options.

Trends in the market: One of the key trends in the German residential real estate market is the increasing demand for urban properties. As more people move to cities for work and lifestyle reasons, the demand for housing in urban areas has surged. This has led to a rise in property prices in cities like Berlin, Munich, and Hamburg. Another trend in the market is the growing popularity of sustainable and energy-efficient properties. German consumers are increasingly concerned about the environmental impact of their homes and are willing to pay a premium for properties that have energy-saving features, such as solar panels and efficient insulation.

Local special circumstances: Germany has a unique rental market, with a significant proportion of the population living in rented accommodation. This has created a strong demand for rental properties, particularly in major cities. As a result, many investors are focusing on purchasing properties for rental purposes, which has further fueled the growth of the residential real estate market.

Underlying macroeconomic factors: Several macroeconomic factors have contributed to the growth of the residential real estate market in Germany. Firstly, the country's strong economy and low unemployment rate have increased consumer confidence and purchasing power. This has led to higher demand for housing, both for personal use and investment purposes. Additionally, the low interest rate environment in Germany has made it more affordable for individuals to take out mortgages and invest in real estate. This has stimulated demand in the market and encouraged more people to enter the property market. In conclusion, the Residential Real Estate Transactions market in Germany has been experiencing steady growth due to customer preferences for real estate as an investment, increasing demand for urban properties, and the popularity of sustainable and energy-efficient homes. The unique rental market in Germany and the country's strong economy and low interest rates have also contributed to the growth of the market.

Methodology

Data coverage:

Figures are based on total and average revenue of residential real estate transactions (sales).

Modeling approach:

Market size is determined by a bottom-up approach. We use national statistics, international organizations, and industry associations to analyze the markets. To estimate the market size for each country individually, we use relevant key market indicators and data from country specific industry associations such as GDP, price level index, household wealth, household size, number of renter and owner households, housing consumer spending per capita.

Forecasts:

We use a variety of forecasting techniques, depending on the behavior of the market, for instance, exponential trend smoothing. The main drivers are GDP per capita, population, number of renter and owner households, price level index, housing consumer spending per capita.

Additional Notes:

Data is modeled using current exchange rates. The market is updated twice per year in case market dynamics change. The impacts of the Russia-Ukraine war considered at a country-specific level.