Prices for residential real estate in Germany rose significantly in the first quarter of 2025, particularly in several major cities. Despite ongoing economic and monetary policy uncertainties, the market for apartments, single-family homes and multi-family homes is gaining momentum.
These insights are based on the latest update of the German Real Estate Index (GREIX), a joint project of the local expert committees (Gutachterausschüsse für Grundstückswerte (GAAs)), ECONtribute, and the Kiel Institute for the World Economy. The transaction databases of the GAAs, which contain notarized sales prices, are analyzed according to the latest scientific standards. All data for currently 21 cities and regions including their neighborhoods are freely available at www.greix.de. The Kreis Mettmann is a new addition.
Compared to the previous quarter (Q1 2025 to Q4 2024), apartment prices increased by 1.0 percent. Prices for single-family homes stagnated, with a minimal increase of 0.1 percent. Multi-family homes are 1.1 percent more expensive. However, due to the low number of transactions in this segment, there is a high degree of volatility, which limits the informational value.
Adjusted for inflation, the price changes deviate only minimally downwards because the inflation rate in the first quarter of 2025 was very low.
A comparison with the same quarter of the previous year (Q1 2025 to Q1 2024) clearly shows the strength of the recent price growth – despite the rise in mortgage rates at the start of the year and concerns about a global recession. Apartment prices increased by 3.2 percent year-over-year. The increase for single-family homes was as high as 4.7 percent, while multi-family homes rose by 8.7 percent. These year-over-year figures represent the highest price growth since mid-2022. The number of transactions is also almost a third higher than in the same period last year.
“The wait-and-see approach has come to an end,” says Jonas Zdrzalek, real estate market expert at the Kiel Institute for the World Economy (Kiel Institute). “Those who want to buy have obviously come to terms with the new circumstances – and are speculating that the real estate market has bottomed out for the time being.”
Significant price increases in almost all cities
Property prices rose across the board in Germany’s eight largest cities. Compared to the previous quarter (Q1 2025 to Q4 2024), apartment prices rose the most in Cologne (+3.4 percent). In Stuttgart (+2.1 percent) and Berlin (+1.7 percent), apartments also became noticeably more expensive. The housing markets in Düsseldorf (+1.3 percent), Frankfurt (+0.7 percent), and Leipzig (+0.6 percent) recorded moderate increases in sales prices. No transaction data is yet available for Hamburg and Munich for the first quarter of 2025.
Outside of the top 8 cities, prices also rose almost everywhere compared to the previous quarter. This was particularly evident in Karlsruhe with an increase of 3.8 percent and in Duisburg with an increase of 3.2 percent. There was a slight fall in prices in Dresden (minus 0.9 percent) – although prices there had already risen sharply in the previous quarters.
Recovery strongest in major cities
Compared to their lowest levels, the recovery is strongest in the major cities. In Leipzig, apartment prices were already about 9 percent higher in the first quarter; in Cologne, around 8 percent higher. Almost all other major cities also experienced a stronger recovery than the average of the 21 cities and regions included in GREIX.
Overall, apartment prices were, on average, only about 10 percent below their all-time highs. “Whether the price increases will continue at the same pace depends on the economic and monetary policy environment,” says Zdrzalek. “But for buyers, the current market situation may feel like a good opportunity to enter the market.”
Methodological note
The Greix is a price index based on a hedonic regression method. This method mitigates price distortions that often arise when using average price per square meter. For instance, if a high number of large apartments in a prime location are sold in a given year, this can inflate average prices per square meter. However, such fluctuations may not reflect a general increase in real estate values. Using hedonic regression methods, specific property characteristics do not cause upward or downward distortions in the price trend.
About the GREIX
What is the GREIX?
The GREIX is a real estate price index for Germany based on the purchase price collections of local expert committees, which contain notarially certified sales prices. It tracks the price development of individual cities and neighborhoods back to 1960 and is based on over two million transactions. With the help of this dataset, long-term trends in real estate markets can be analyzed and current developments can be placed in a historical context.
What Data and Methods are Used to Create the Indices?
The local expert committees collect data on all real estate transactions. The price index is estimated using the latest scientific standards and statistical methods (hedonic regression method).
Who is Funding the GREIX?
The GREIX is funded through public grants and is a project of the DFG-funded Bonn-Cologne Excellence Cluster ECONtribute and the Kiel Institute for the World Economy (IfW Kiel) with the goal of increasing transparency in the real estate market. Various price indexes for 20 cities and regions are freely accessible at www.greix.de
The dataset will be gradually expanded to include more cities.