VDP index: Real estate prices in Germany fall by 5.3% - Current development 2024

VDP index: Real estate prices in Germany fall by 5.3% - Current development 2024

In the first quarter of this year, the price adjustment process for real estate prices in Germany continued, as the real estate price index of the Association of German Pfandbriefbanken (VDP) shows. The index reached a value of 174.7 points, which corresponds to a minus of 5.3 % compared to the previous year's value and 0.3 % compared to the previous quarter. The price correction now amounts to 10.3 % since the highest level in the second quarter of 2022. The VDP index is based on real real estate transaction data of over 700 credit institutions and covers both residential and commercial properties.

Compared to the same period last year, residential property prices fell 4.3 %in the first quarter of 2024. Since the highest level in the second quarter of 2022, the prices for residential properties in Germany have decreased by a total of 8.6 %. The prices for commercial properties showed a significantly stronger price adjustment than residential properties with a decline of 9.6 % in the year. Between the second quarter of 2022 and the first quarter of 2024, commercial property prices decreased by 17.2 %.

The general manager of the VDP, Jens Tolckmitt, commented on the development as follows: With residential properties, a gradual price stabilization is already indicated, while no ground formation is yet evident in commercial real estate. The prices for apartment buildings remained stable compared to the previous quarter, while the self -used home ownership had to accept slight losses.

Tolckmitt pointed out that residential properties will remain scarce in the long term, which will continue to affect rent development. In the top 7 cities, residential property prices developed similarly to the entire federal territory, with Cologne recording a slight price growth.

on the commercial property market continued to deprive itself, especially for office and retail properties. Prices for commercial properties gave up by almost 10 %. Here, too, double -digit returns were shown in the previous year.

The VDP general manager emphasized that the commercial property sector continues to face structural challenges and that the subsequent quarters can also be expected to return to prices. A relaxation of the situation can only be expected from the beginning of 2025.

The VDP real estate price index is published quarterly and is based on actually realized purchase prices and rents of over 700 credit institutions. It is an important indicator of real estate price development in Germany.

The following table shows the development of residential property prices in the top 7 cities:

Source: Association of German Pfandbriefbanken (VDP)

Source: Association of German Pfandbriefbanken (vdp) e.v./OTS