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RENTING

The most expensive (and cheapest) cities in Germany to rent a room

For those looking to find a room in a flatshare in Germany, it can be helpful to know which cities have higher prices, and where it's more affordable.

Published: 21 June 2022 16:29 CEST
An aerial view of flats in Munich.
An aerial view of flats in Munich. Photo: picture alliance/dpa | Sina Schuldt

Due to rising demand and low supplies, the cost of renting a flat in some German cities has risen dramatically in recent years. 

For that reason, many people decide to enter into a flatshare – known as a Wohngemeinschaft or WG in Germany. Lots of students, trainees on apprenticeships and people who are not staying in Germany for a long time may also decide to go down the WG route. 

In view of the difficult housing market in Germany right now, however, renting a room can still be pricey depending on where it is. 

Housing market analyst Empirica carried out research on the cost of renting a room ahead of the university summer semester in Germany which began in April. 

Using several thousand rental advertisements for shared flats, they looked at warm rents (the base rent as well as additional costs) for an unfurnished room between 10 and 30 square metres. 

READ ALSO: Six confusing things about renting a flat in Germany 

The group found that shared flats were 22 percent more expensive in 2022 than in the 2017 summer semester.

“In the university locations as a whole, the standard price for the current semester is €421 and thus 22 percent higher than in the summer semester 2017 – or €19 higher than in the summer semester 2021,” said the market analyst.

Colourful flats in Berlin.

Colourful flats in Berlin. Photo: picture alliance/dpa | Wolfgang Kumm

Where do rooms cost the most – and the least?

The standard price for an unfurnished room in a shared flat is highest in Munich – at €650 per month. It’s perhaps unsurprising since the Bavarian capital is known as one of the most expensive places to rent a home in Germany – and even Europe. A recent ranking on the cost of living by ECA placed the German cities of Munich (16th) and Frankfurt (19th) in the top 20 most expensive cities in Europe. 

Munich is followed by Hamburg, Frankfurt and Berlin where a WG room will set you back about €500 per month, according to the study. And in Cologne, renters there face paying around €490 per month in rent to live in a shared flat. 

READ ALSO: Revealed – how much it costs to rent a room in a German university town 

The most affordable offers for a WG room are currently in Magdeburg (Saxony-Anhalt) where it costs €259 per month to stay in a flatshare and Halle where it’s €260 per month.

The graph by Statista below shows the most expensive and most affordable cities this year, according to the study. 

Infografik: Wo WG-Mieten besonders teuer/günstig sind | Statista

Source: Statista

Other more affordable cities are Erfurt in Thuringia (€300 per month), Paderborn in North Rhine-Westphalia (€305) and Leipzig in Saxony (€320).

Vocabulary

Cheap/affordable – günstig

More affordable price – günstigerer Preis 

More expensive – teurer 

Unfurnished – unmöbliert 

Housing market – (der) Wohnungsmarkt 

We’re aiming to help our readers improve their German by translating vocabulary from some of our news stories. Did you find this article useful? Let us know.

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RENTING

Do rising rents make buying a home in Germany a better option?

Across Germany, rents have shot up in the last two years while property prices have fallen. Experts say this is making buying more attractive than renting at the moment.

Published: 19 September 2024 16:48 CEST
Do rising rents make buying a home in Germany a better option?

For several years, property prices in Germany rose at a much faster pace than rents. Between 2016 and 2022, the average price for apartments climbed by a dramatic 76.5 percent, according to an analysis by real estate company ImmoScout 24. During the same period, rents for flats rose by 26.8 percent.

Experts said this was due to comparatively low interest rates and high buyer demand along with limited supply – all of which caused the property market to explode. 

However, this trend has reversed over the past two years, with rental prices rising significantly more than purchase prices.

According to ImmoScout, falling property prices is a big factor. The price index for apartments fell by 9.4 percent between 2022 and 2024, while rents rose on average by 11.7 percent, reducing the difference in price development from a peak of 39.2 percent in 2022 to 12.9 percent this year.

At the same time, the strong pressure on the rental market has resulted in a considerable financial burden for tenants. An earlier ImmoScout analysis from March showed that rental flats in Germany’s 40 largest cities received 21 times more enquiries than owner-occupied flats.

In another study released in summer, real estate experts Jones Lang LaSalle (JLL) found that asking rents for flats in the eight major cities of Berlin, Hamburg, Munich, Cologne, Frankfurt, Düsseldorf, Stuttgart and Leipzig climbed by an average of 6.3 percent in the first half of 2024 compared to the same period last year.

READ ALSO: Rents still rising fast in major German cities

Real estate experts say it means buying a property in Germany has become more attractive.

“The sharp rise in rents in particular is making buying a property as an investment or home more and more attractive,” said Dr Gesa Crockford from ImmoScout. 

The index values for renting and buying have converged even more in Germany’s five largest cities – Berlin, Frankfurt, Hamburg, Cologne and Munich. 

Berlin prenzlauer Berg

Flats in the Berlin district of Prenzlauer Berg. Photo: picture alliance/dpa | Monika Skolimowska

The purchase price of existing flats rose by 65.5 percent between 2016 and 2021, while the rental price only increased by 21.6 percent. From the peak in 2021, prices for apartments have fallen by 2.1 percent, while rents have continued to rise by 28.9 percent. As a result, the gap in price development since 2016 has shrunk from 36.1 percent (2021) to 3.4 percent (2024).

People looking to rent in major cities are not only facing rising rents, but also fierce competition to snag an affordable place to live. 

“In the metropolises, buying has become increasingly worthwhile over the past two years,” said Crockford. “There, the difference between purchase and rental prices has levelled off from 30 percent and more to a low single-digit percentage range.”

Is it better to buy a home than rent?

Choosing to buy instead of renting is of course a personal decision and you have to consider several factors – including whether you can afford the mortgage and extra fees associated with house buying.

That said, property prices are expected to increase again slightly after the dip over the last two years.

READ ALSO: Is autumn 2024 the right time to buy a property in Germany?

However, it should also be noted that tenants rights are strong in Germany so renting can be a worthwhile and savvy way to go, if you can find a home that is affordable to you. 

That goes some way to explain why Germany has one of the lowest level of property ownership in the EU, with just over half of the population owning their own home.

Meanwhile, one study released in 2023 by credit insurer Allianz Trade found that buying property in Germany is “significantly more expensive than renting in Germany”.

Even if rents were raised by the legal maximum of 20 percent next year compared to 2023, the difference between average mortgage repayments and average rents would still come in at €381 per month, said the insurer. 

However, some buyers may consider a home an investment in the long term and rely on the value going up over time – though this, of course, is not guaranteed. 

READ ALSO: How the cost of renting in Germany compares to home ownership

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