Out now: Market Report for investment properties

Engel & Völkers Commercial has analyzed the market for Residential Investment in 64 German cities and examined the nationwide market as a whole. The 164-page report is all about real estate prices, the development of yields, market trends and expert forecasts. Interested parties get a free PDF copy of the full report here.

Positive market trend since 2024

Falling interest rates have revived the market for investment properties: in 2024, around 12% more apartment buildings (around 31,900 properties in total) were sold in Germany than in the previous year, while the transaction volume rose by 10% to EUR 26.5 billion. Demand is growing, particularly in major cities and their surrounding areas. 

Investors back on the market

Currently, private investors in particular, but increasingly also institutional investors, are taking advantage of the improved financing conditions in combination with moderate prices. International investors have also rediscovered the German market for Residential Investment. In addition, the fact that many private owners are looking to sell in order to avoid the expense of necessary renovations is contributing to the market recovery. 

Offer prices at the level of three years ago

The current level of asking prices is roughly the same as three years ago. Price reductions such as those seen in 2022/23 are generally no longer to be found on the market for residential and commercial properties today. However, there is certainly room for negotiation for buyers of properties in an unsatisfactory energy condition. 

There are currently many existing properties with renovation potential on the market: 45% of advertised residential and commercial properties have an energy efficiency rating of F or worse. For many investors, this represents an attractive alternative to expensive new builds. Experience shows that buying existing properties plus modernization costs is often cheaper than investing in new-build properties. 

Optimistic outlook

Yields are expected to increase moderately over the course of 2025. “That's why an investment is sensible and attractive right now - even in properties in need of refurbishment. After a refurbishment, significant increases in value can be expected in the long term,” says Till-Fabian Zalewski, CEO for the D-A-CH region at Engel & Völkers. (20.2.25)

Tip: You can find continuously updated interactive graphics on market developments here.