Rent or buy? Significantly less competition on the buying market
Rent or buy? Significantly less competition on the buying market
In a current analysis by Immoscout24, the 40 largest cities in Germany were examined to find out how much living space is available for a monthly rent from 1,000-1,200 euros compared to a condominium if the same amount for monthly financing is issued. The analysis also shows how high the demand pressure is compared to the rental market. The results of this analysis could offer local effects and relevant context for regional readers.
The analysis reveals that the demand for a rental apartment is 21 times higher compared to a condominium. This unequal is shown in almost all of the 40 largest cities in Germany. In some cities such as Hamburg and Berlin, the competition on the rental market is particularly high, with about 60 times more inquiries for a rental apartment compared to a condominium. In Munich and Cologne, demand is 46 to 50 times higher. The cities of Dresden and Erfurt, on the other hand, have less pressure on the rental market, with a demand that is only three times as high as that of condominiums.
Interestingly, the difference between the living space between ownership and rental apartments in many cities is slightly. In about half of the cities, the difference is less than five square meters. In some cities there is even more living space for the same budget when buying a condominium compared to the rent. Mönchengladbach stands out here, where you get an average of 21 square meters more living space when buying for the same price. In Dortmund the difference is around ten square meters. Frankfurt am Main and Stuttgart also offer minimally more living space when buying.In the 40 largest cities in Germany, you get an average of 90 square meters of living space for rent and 83 square meters of living space for a monthly budget of 1,000-1,200 euros. The cities of Mönchengladbach, Wuppertal and Saarbrücken offer most square meters of living space when buying, while Chemnitz, Magdeburg and Gelsenkirchen offer most square meters for rent. The city with the lowest living space for the budget is Munich.
These results show that the purchase of real estate can be financially a sensible alternative to rent, especially in cities with a high demand pressure on the rental market. The Immoscout24 analysis takes into account an interest rate of 3.49% with a 15-year binding and a 2% repayment. It is assumed that 20% capital share is brought in at the purchase price.
The results of this analysis offer local effects and context for regional readers in Stuttgart and other cities in Germany. It confirms that the lack of living space and the demand pressure in large cities like Stuttgart are still a big problem. It could encourage local readers to consider buying a property as a financially sensible alternative to rent. A table with the results of the analysis could be useful in this context to visualize the comparisons between the cities.
Source: Immoscout24/OTS
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