Rents in Bavaria continue to rise - Munich remains the leader

Rents in Bavaria continue to rise - Munich remains the leader

Rents in Bavaria are experiencing a dramatic increase, well above the national average. Munich, as the most expensive city in Germany, records rents averaging 19.39 euros per square meter - a value that is moving towards the 20 euro mark. In comparison, rents in other German cities such as Frankfurt, Berlin and Stuttgart are significantly lower. Interestingly, rents in the districts and cities around Munich are rising rapidly, with even regions such as Starnberg, Fürstenfeldbruck and Dachau recording rents that are similar to those in Frankfurt.

Not only in Munich itself, but also in the surrounding area, rents have risen significantly since 2014. For example, Fürstenfeldbruck, Dachau and Aichach-Friedberg recorded rent increases of 58 to 68 percent. The strong influx into the suburbs is driving rents ever higher. Compared to the German average, regions such as Freyung-Grafenau, Hof and Dingolfing-Landau in Lower Bavaria even show increases of up to 87 percent.

Experts such as Roman Heidrich, residential real estate expert at JLL, warn of the tense situation on the rental market caused by insufficient construction activity. In order to curb the rise in rents, Heidrich suggests making new housing construction more attractive through tax cuts. In particular, the reduction in VAT for new rental residential buildings from 19 to seven percent could ease the burden on the housing market. Despite these solutions, the future of the housing market in Bavaria and throughout Germany remains a challenge.