ÌÇÐÄÆƽâ°æ

Most of the German population rented their housing. In 2025, around **** million people did so, compared to roughly **** million who had their own house. The German real estate market does offer different housing options, but it is also an increasingly tough one for tenants and future homeowners to navigate amid the ongoing recession.

Competitive and expensive

Becoming a homeowner is getting more and more difficult in Germany. After almost a decade of uninterrupted growth, the market has entered a period of downturn. For years, homebuyers could access cheap credit, with mortgage rates as low as *** percent. However, in 2022 and 2023, mortgage rates have increased strongly to over **** percent, making it much more expensive to invest in residential property. In addition to that, prices for owner occupied houses have increased by over ** percent since 2015, house price growth had also overtaken that of rentals the same year, making renting the cheaper living option, especially for younger people. The summary of the housing situation sounds familiar worldwide: fierce competition in urban areas when searching for rentals, with demand far outstripping supply, as well as rising property prices for those considering a house purchase. 

Somewhere to live

The decision to rent rather than buy may occur for various reasons. Tenants may simply not be ready financially to buy a home, be that a house or apartment, or they would not be considered by a bank for a loan based on their current earnings. They may be pressed for time and hope to find a place to rent quicker, while buying a home is a long-term commitment, leading to different types of costs and legalities. A ** of people lived in shared apartments in recent years, but figures had not changed so much as to rule this type of housing out as a popular option. Shared or not, the average rent prices of residential property in Germany have been going up year after year, both for new buildings and older ones.