In the past Berlin had relatively low rental costs compared to other modern and developed cities such as London and Hong Kong, but in the past 3 years, Berlin’s property value has risen from 30% to 50% due to an increase in habitants and a high demand for exclusive residential property (source: Knight Frank’s Global Real Estate Index). If you’re looking for a sound property investment opportunity, Berlin may be the place for you.
Increase in inhabitants
On average the population size has increased by 25,000 people every year and in the year 2012, over 60,000 people moved to the city of Berlin. Due to the steady growing population, this has led to a great demand for one to two bedroom flats in the city, especially in areas such as Friedrichshain-Kreuzberg and Charlottenburg-Wilmersdorf. Moreover, the purchasing power of Berlin habitants has increased to an above average level.
High demand for exclusive residential property
According to estate agents Engel & Völkers, due to the high demand for exclusive residential property, this has led to significant increased property prices in the central districts of Berlin. The residential property is in such high demand that premium properties are sold right after the first viewing in popular locations. Other than new properties selling like hot cakes, this has also led to a rise of average basic rent by 13.8%, from €2.01 per square foot to €2.29 per square foot (source: 9th Housing Market Report GSW Immobilien AG).
Due to these circumstances, this has attracted a number of local and international investors to buy property in Berlin. Although the city was once divided, the reunion has led to significant urban and social development. As the city grows and develops, the property future will probably be a bright one in Berlin.