A market commentary by Jürgen Michael Schick
Berlin is one of Europe’s central residential investment markets. Hardly any other city is under such constant observation by international investors as the German capital. Even phases of intensive political debates do little to change this. The reason for this is the continuing population growth, the high demand for housing and the economic fundamentals of the metropolis.
In the current market phase, there is an interesting difference in perspective: While the discussion in Germany is often dominated by regulation and political intervention, many international investors assess the Berlin residential investment market much more soberly. For them, the long-term view of demand, price level and market size is in the foreground.
International capital is in the market – even if it is not always visible
The sources of capital behind transactions are not always recognizable at first glance. In many cases, the funds do not come from the buyers’ own resources alone. International investors often enter the market via local partners or existing market structures. As a result, the additional capital remains less visible for the time being, but significantly expands the scope of action of individual market participants.
This development can already be observed in the market. Some Berlin investors are again appearing with significantly larger budgets, smaller market participants are moving volumes that would have been unusual just a few years ago.
Berlin remains attractive by international standards
The interest of international investors can also be explained by the fact that the price level of the Berlin residential investment market remains moderate compared to other European countries. While significantly higher valuations have been achieved in cities such as London or Paris for years, international investors continue to see entry opportunities in German residential investment markets. A look at apartment prices in European metropolises illustrates these differences: In the first quarter of 2025, the average price per square metre for condominiums in London was around 13,440 euros, in Paris around 9,470 euros and in Berlin around 5,880 euros (Statista).
Regulated housing markets are the rule internationally
The discussion about regulation is also often classified differently internationally. Investors from markets like Paris have long been accustomed to regulated housing markets. In other cities, such as New York, regulatory interventions have been significantly expanded in recent years. Government intervention in rental markets is thus part of the regulatory framework in many large cities. International comparative data also show that rent regulation is part of the housing policy instruments in numerous OECD countries. Germany is therefore not alone with its regulations in an international comparison.
Fundamentals keep Berlin in the focus of international investors
For many investors, the long-term view of the fundamentals remains crucial. Berlin is growing, the demand for housing remains high and the market has sustained momentum. An interesting perspective emerges, especially in an international comparison: While the German debate is often dominated by regulation, international investors are focusing more on demand and long-term development. From this perspective, Berlin remains a market with room for development, and that is precisely why the capital is once again coming back into focus for international investors.
