In 2017, buyers spent a record-breaking sum on Berlin real estate, although fewer and smaller apartments were sold, according to a report published on Monday.
The annual report from the appraisal board for real estate values in Berlin found that the growing population of the German capital as well as the rising number of singles seeking apartments has boosted demand in the real estate market.
What the report found:
- All of the houses, apartments and plots of land that sold in Berlin last year totaled €18.2 billion ($21.2 billion), breaking the previous record set in 2015.
- Despite the high sum, the number of properties purchased was lower than in 2016, underscoring the rarity and high expense of Berlin real estate.
- Purchasing prices for apartments rose by 13 percent.
- More than 25,000 apartments were sold in the city last year for an average price of €3,626 per square meter.
- The most expensive apartment sold in 2017 cost €8.5 million and was located close to the popular shopping boulevard Kurfürstendamm (Ku'damm).
Paying more for less space: The report also found that the average size of purchased apartments shrunk compared to previous years. The report attributed the shrinking size to ever-increasing property prices that push buyers to purchase more affordable and smaller apartments. Another reason is the rise of so-called "micro-apartments" — properties that are around 20 square meters and are often used as student apartments.
Soaring prices: The rising property prices in Berlin are a boon for vendors, but present a daunting and often insurmountable hurdle for would-be buyers and renters. Over the past few years, rents in the city have risen by 9.4 percent. Thousands of people protested against the skyrocketing housing costs in April.
Housing shortage: German Chancellor Angela Merkel has pledged to combat rental and property price hikes, saying her government has set aside €6 billion. The money will be used to boost social welfare housing projects, as well as to give grants to families who build or purchase a home.