Overview

• Prices rose 1.1% in Q2 2025 from the previous quarter and 4.1% year over year, marking the fifth consecutive quarterly increase, according to the Verband Deutscher Pfandbriefbanken.
• Migratory pressure from more than one million Ukrainian arrivals has intensified demand across urban and rural markets, further stretching limited housing supply.
• High ECB key interest rates have driven up mortgage costs and stalled many housing projects, keeping new construction well below government targets.
• Regional disparities persist as Düsseldorf and Frankfurt recorded the fastest Q2 price gains at 2.0% and 1.7% respectively, while Stuttgart lagged with a 0.8% rise.
• Leipzig has become the first major German city to return to its 2022 price peak, buoyed by sustained in-migration and still comparatively low rent levels.