Germany’s residential property market started 2026 on a firmer footing. According to The Grounds, citing the housing index of the German Economic Institute for the first quarter of 2026, purchase prices have largely stabilized after several years of market volatility. At the same time, the rental market remains under pressure, with strong demand for apartments and limited new supply.

📊 In the first quarter of 2026, purchase prices for apartments, detached houses, and semi-detached houses increased by only 0.1% compared with the previous quarter. This points to almost complete price stagnation. On an annual basis, however, apartments still showed moderate growth, rising by 2.5% compared with the first quarter of 2025.

📈 The rental market shows stronger momentum. Asking rents for new leases increased by 3.5% year-on-year. Growth was even more pronounced in the suburbs of major cities, where rents rose by 4.2%. This is an important signal for investors, as rental demand is increasingly becoming the key driver of returns rather than rapid capital appreciation.

📌 Key figures for the beginning of 2026:

— purchase prices for apartments and houses increased by 0.1% quarter-on-quarter;
— apartment prices rose by 2.5% year-on-year;
— asking rents for new leases increased by 3.5% year-on-year;
— rents in the suburbs of major cities rose by 4.2%;
— purchase prices in Berlin increased by 0.8% year-on-year;
— energy efficiency can affect property prices by up to 30%.

🏙 Berlin is a particularly interesting case. In the city itself, rents have recently declined slightly, by around 0.8%. However, overall demand pressure remains high. In the suburbs of Berlin, pressure on the rental market remains strong, as part of demand is shifting outside the city due to housing costs, limited supply, and the search for more affordable options.

🏡 For buyers, this means that the German property market is becoming more predictable. There is no sharp fall in prices, but the previous rapid growth in purchase prices has not returned either. This balance may suit buyers who see German real estate not as a short-term speculative asset, but as a long-term investment with rental potential.

⚡ Energy efficiency is becoming an increasingly important pricing factor. According to the analysis, less energy-efficient buildings continue to sell at a significant discount, which can reach up to 30% compared with properties with strong energy performance. Against the backdrop of higher energy costs, this factor matters not only for investors but also for buyers planning to live in the property themselves.

📍 This dynamic creates a clearer division within the market. Apartments in strong locations, with good transport access, stable rental demand, and high energy efficiency may retain liquidity even when prices are stable. Properties with poor energy efficiency, by contrast, require a more careful assessment of maintenance costs and potential modernization needs.

🔎 You can explore available properties in Germany for living or investment on our website.