German condominium prices fall year-over-year for first time in over two years, Digi Mart USA News (Germany): Owner-occupied apartments in Germany have become cheaper for the first time in more than two years. Prices fell 0.2 percent in the summer quarter compared with the previous year, the Kiel Institute for the World Economy (IfW) said on Thursday.
It was the first year-over-year decline since spring 2024.
Compared with the previous quarter, prices for condominiums rose 0.5 percent. That increase was not enough to offset the decline recorded since autumn 2025.
The index is based on sales prices certified by notaries.
“The price increase for condominiums has come to a virtual standstill,” said IfW real estate expert Jonas Zdrzalek. He said the first year-over-year decline in more than two years marks a trend reversal.
Listing data also point to a weaker market. “Apartments and houses remain listed for longer, and asking prices are more often being reduced.”
Adjusted for inflation, prices fell in all segments. Fewer properties were also sold.
In the second quarter, the number of condominiums sold fell 1.7 percent year-over-year, while sales of single-family homes dropped by 8.2 percent.
Developments in urban housing markets were uneven. Prices in Cologne and Frankfurt am Main rose 2.8 and 2.4 percent quarter-over-quarter, while prices in Berlin fell 0.9 percent.
A special analysis shows that expensive markets are recovering more slowly. Prices in Stuttgart were still nearly 22 percent below their previous peak, while in Leipzig they had already moved 3.6 percent above theirs.
“There is no talk of a nationwide recovery,” Zdrzalek said. “While some lower-priced markets have already regained their previous peaks, many expensive markets are still well below them.” One possible explanation, he said, is greater sensitivity to interest rates.
“Where properties were already expensive before the interest rate turnaround and offered comparatively low returns, higher financing costs are likely to have weighed particularly heavily on prices.”
