Munich: rental prices continue to rise - records and provide buyers!

Munich: rental prices continue to rise - records and provide buyers!

Mansfeld-Südharz, Deutschland - In recent years, Munich has developed into one of the most expensive places of residence in Germany, a trend that also in the latest evaluation of the Living Atlas 2025 becomes clear. In the coming year, buyers will have to apply an average of 43.6% of their available household income for a 70-square-meter own area. A huge chunk that makes living difficult for many.

The rental prices reach a record level in the Bavarian capital, as well as the Süddeutsche Zeitung . Munich households spend an average of 25.5% of their income for net rent. Only in Berlin is the rental load with 27.1% higher. These figures show that living in Munich not only is expensive, but also increasingly less affordable.

rental and purchase prices in comparison

The average rent for existing apartments with good living value is now 21.40 euros per square meter. For comparison: In autumn 2022 it was still 21.20 euros per square meter. A year ago you even had to pay 20.30 euros per square meter. So the climb is there, even if, according to Stephan Kippes from the real estate association Germany Süd (IVD), it is no longer as steep as before.

In terms of purchase prices, there is a small ray of hope: the prices have dropped by average by 0.7%, while the income has risen. Nevertheless, Munich with a square meter price of 8,715 euros remains the most expensive big city in Germany, as another report by Engel & Völkers . For buyers, this means that they have to raise an average of 18.3% of their income for the financing of a condominium, a slight decline compared to the previous year.

market development and future outlook

The demand for residential properties remains high, many people have a feel that good properties are worth a lot. Despite the decline in construction activity and stagnating building permits, the market shows a positive development: Commercial activity increased in 2024 after 2023 was considered the low point. This could be mainly due to the improved financing situation and the lower price level.

The trends show an increasing importance of energy efficiency and location for price development. Even if the interest rate policy of the European Central Bank has a major impact on the market, the first key interest rate reduction in June 2024 has not yet become noticeable in the building interest rates. However, there is a certain hope: the construction interest rates fell to almost 3% in early August 2024.

Overall, the Munich real estate market is faced with an exciting phase. Buyers have the opportunity to choose between different objects without being lost in a bidding competition. It remains to be seen how prices and buying behavior will develop in the coming months. A good knack in the choice of real estate can therefore prove to be the right one!