Rental costs increase in Berlin despite rent cap

Rental costs increase in Berlin despite rent cap

Average rental prices increase by 5.6% in Berlin during 2016, indicating a string price rise despite rent cap being introduced in 2015.

A housing market report by Berlin Hyp and real estate advisor CBRE explained that the growth was led by apartments, for which rents increased by up to 15.7%, depending on their location.

Germany’s investors & Manchester’s property: An unusual friendship

Reasons for the drastic increase in rents is the city’s rising population. In 2015 alone, Berlin’s population increased by 48,000 and since 2005 the city has grown by 270,000 residents.

Thanks to the rent cap (forbidding landlords to increase rents by more than 10% the local average), however, rents in the capital stayed below those of other German cities like Cologne, Hamburg, Frankfurt, Munich and Dusseldorf. Average asking rents in Berlin went up to €9 per square meter per month, which is still considerably lower than Munich’s average of €15.11.

“The ongoing development of Berlin is stunning. The dynamics on the market for rental apartments and new construction projects as well as the acceleration of purchasing prices are unique in Germany,” says Henrik Baumunk, head of residential services at CBRE in Germany.

“However, in terms of rents and purchasing prices there is still a lot of potential in Berlin, particularly due to the ongoing population growth and at the same time moderate construction activity as well as the rising economic strength of the city.”

Gero Bergmann, a member of the board of management at Berlin Hyp, adds: “The supply is getting smaller because tenants are less willing to move in view of the decreasing supply and higher asking prices.”

Tell us how hipster you are and we’ll find the perfect property hotspot for you

“One of the key highlights of this report is the sustained growth of Berlin’s residential sector. Over the past few years investors have been shifting capital in increasing amounts into Europe’s most undervalued capital city,” said Ian Sigmund, investment associate at IP Global.

For those looking to invest in Berlin’s booming property, it may be worthwhile considering properties that are new build or completely refurbished as these are exempt from the rental capping law.

Self-certified Sophisticated Investor

Please read

I declare that I am a self-certified sophisticated investor for the purposes of the restriction on promotion of non-mainstream pooled investments. I understand that this means:

I am a self-certified sophisticated investor because at least one of the following applies:

I accept that the investments to which the promotions will relate may expose me to a significant risk of losing all of the money or other property invested. I am aware that it is open to me seek advice from someone who specialises in advising on non-mainstream pooled investments.

High Net Worth Investor

Please read

I make this statement so that I can receive promotional communications which are exempt from the restriction on promotion of non-mainstream pooled investments. The exemption relates to certified high net worth investors and I declare that I qualify as such because at least one of the following applies to me:


Sign up for first access to new developments and exclusive property investment opportunities.

We send limited and targeted emails on new launches and exclusive deals which best fit your areas. We are trusted by over 30,000 active buyers as their source for new stock.

  • New property developments
  • Professional market reports
  • Property deal alerts
  • Development updates
Manchester property investment


Receive trending news straight to your inbox and stay up to date on all of the property market trends and advice.

Established since 2005 we are a leading voice of authority and commentary on the UK property market. Our news is trusted by Apple News & Google News.

  • UK housing market
  • Mortgage & money
  • Buy-to-let landlords
  • Guides & advice

Talk to us

Speak to our UK property experts today:


+44 (0) 333 123 0320

Open from 9am-6pm GMT


+852 6699 9008

Open from 9am-6pm HKT