Residential Property Market in Germany: Q1 2025 Insights
The investment market for residential property in Germany saw a transaction volume of 2.4 billion in Q1 2025, marking the best start since 2022.
Major Transactions in the First Quarter
- The market witnessed a total of almost 19,800 apartments traded, significantly higher than previous quarters.
- Large ticket transactions remained dominant; deals over 100 million accounted for 58% of total sales.
- Notable transactions included sales to In-West Immobilien GmbH and One Investment ManagementOrange Capital.
- Wohnungsgenossenschaft Neukölln e.G. purchased 396 residential units in Berlin-Spandau.
Market Fundamentals and Outlook
- Investments in A markets totaled approximately 430 million, with new constructions contributing significantly.
- The value-add profile represented around 52% of the transaction volume, amounting to 1,250 million.
- Despite challenges in the financing environment, the market outlook remains positive due to rising rents and attractive entry prices.
Long-Term Trends
- The German residential market faces supply-demand imbalances, with low vacancy rates in many cities.
- Rising rents are expected, with more dynamic growth in second and third tier towns.
- Recent developments in bond and finance markets pose challenges to investors.
Investment Forecast
- The market is expected to maintain investment momentum in 2025, targeting a transaction volume exceeding 10 billion.
- The combination of rental growth and favorable prices will sustain investor interest.
Methodology
The analysis covers residential properties with at least 20 units, excluding certain specialized forms.
About Lübke Kelber
Lübke Kelber AG is a real estate specialist with over 55 years of experience, offering transaction advice and investment management services.
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