German Rental Prices Stagnate as Tenants Resist Higher Costs

Recent trends in rental prices indicate a significant slowdown in the increase of asking rents across various German cities. The Kiel Institute for World Economy reports a modest rise of 0.5 percent for unrented apartments from July to September.

However, when accounting for inflation, rents effectively stagnated during this period. In cities like Hamburg, nominal rents have even seen a slight decline, while other areas like Kiel and Lübeck experienced small increases.

The overall trend reveals a growing hesitance among tenants to accept rising rental costs. Experts, including project leader Jonas Zdrzalek, suggest that many tenants may no longer have the financial capacity or willingness to pay higher rents.

This sentiment is echoed in regions like North Rhine-Westphalia, where rental growth has slowed to its lowest rate since late 2021. As the rental market adjusts, the implications for both landlords and tenants become increasingly significant.