Munich real estate market: Why buying a condominium is worth it now

Munich real estate market: Why buying a condominium is worth it now

According to a report from www.abendzeitung-muenchen.de, the detached single-family home has become a rare and expensive object on the Munich real estate market. Instead, existing condominiums, especially those with three to four rooms and a size of 60 to 90 square meters, are the most frequently traded type of property. These properties are “on offer” on the market due to rising interest rates and are seeing a fall in the average price per square meter compared to around two years ago.

According to the IVD, the average price per square meter for existing condominiums was around 9,475 euros by mid-2022, while today it is 8,290 euros. This leads to the question “to buy or not to buy?” is becoming more and more present. The IVD also predicts that interest rates will neither rise nor fall any further in 2024.

There are various reasons for this development, including rising loan interest rates, which can reach up to 4.5 percent. This is causing some potential buyers to choose to rent rather than buy, which in turn contributes to rising rental prices in Munich. Another driving force for rising rents is the annual influx of up to 20,000 new residents into the city.

The impact on the Munich real estate market could be greater demand for existing condominiums, while at the same time the supply of detached single-family homes remains scarce and expensive. This could also lead to further rising rental prices as more people choose to rent instead of buy. The real estate market in Munich is expected to remain dynamic as interest rates are expected to remain stable and demand for housing in the city remains high.