Overview

• Rents on new contracts in the seven biggest cities rose about 75% from 2013 to 2024, while existing rents increased only moderately.
• The current average premium for a new lease is 4.48 euros per square meter, equal to a 48% surcharge over existing contracts.
• City gaps are widest in Berlin at roughly 70%, followed by Munich at 45% and Hamburg at 37%, with Cologne, Frankfurt, Stuttgart and Düsseldorf at 30% to 36%.
• Ifo warns the divergence keeps people in cheaper legacy leases, reduces residential mobility and risks weakening urban labor markets if workers cannot afford to move.
• For low-income households, the typical rent burden is about 35%, yet it approaches 50% for new rentals in big cities, prompting Ifo to urge supply-side measures and targeted affordable housing over reliance on price caps.