Real Estate Market Report Germany - Q2 2025

The report for the second quarter of 2025 provides a detailed analysis of the German real estate market amid economic headwinds and evolving market dynamics. It examines the weakening economic momentum following a strong first quarter, with particular focus on the residential property transaction market's continued recovery, showing a 41% increase to €4.0-4.5 billion in the first half of 2025. The report analyzes critical construction activity indicators, including a modest 4.9% increase in building permits and a dramatic 73% decline in construction starts compared to 2022. It covers office market challenges with transaction volumes hitting their lowest level since 2009, while highlighting government initiatives including the "Housing Turbo" legislation and comprehensive housing reforms. The regional analysis focuses on Berlin's market leadership in transaction volumes and the Top 7 cities' office market dynamics, with detailed insights into vacancy rates, rent developments, and investment patterns. Additionally, it addresses emerging sectors such as serviced apartments and student housing, alongside the impact of rising construction costs and regulatory changes on the broader real estate landscape.

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