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Germany’s Home Prices Jump 3.8% in Q1, Marking Strongest Gain Since 2022

Analysts expect annual price gains to stabilize near 3 percent through 2026.

Ein Eigenheim bleibt Kern vieler Lebenspläne – doch die Einstiegshürden steigen: Im ersten Quartal 2025 kletterte der Häuserpreisindex um 3,8 Prozent gegenüber dem Vorjahr.
Wohnungen in Hamburg (Symbolbild).
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Overview

  • Residential property prices rose 3.8 percent in the first quarter of 2025 compared with a year earlier, the second consecutive quarterly increase after a prolonged downturn.
  • ECB rate cuts have driven mortgage borrowing costs lower and enabled buyers to secure more living space for a €350,000 budget than in 2022.
  • Price growth varied sharply across regions, with condominium costs up 3.8 percent in Germany’s seven largest cities, 6.1 percent in other urban centres, 4.1 percent in densely populated rural districts and down 0.8 percent in thinly populated areas.
  • Single- and two-family home prices climbed by 3.4 percent in non-top-7 urban districts and by 2.5 percent in the most sparsely populated rural counties in Q1.
  • A Reuters survey of 15 banks and financial institutions projects that home prices will rise by about 3 percent annually in both 2025 and 2026.