Frankfurt am Main,

Strong investment activity on the German housing market

  • Transaction volume already at EUR 9.8 billion by the third quarter

  • Sustained high level of interest despite higher buying prices

  • Housing investment market dominated by German players – but growing interest from foreign investors

  • Well filled sales pipeline suggests a year-end transaction volume at the year-earlier level

Trading in German residential portfolios continues to be one of the most popular investment targets on the German real estate market. All in all, residential portfolios and complexes upwards of 50 residential units worth €9.8 billion changed hands the first nine months of 2017.

Dr. Jan Linsin, Head of Research Germany
The year-earlier result was therefore exceeded by almost one third. ‘German Resi’ ranks among the most attractive risk-adjusted asset classes in the world. The private rented sector (PRS) which, from an institutional investor standpoint, has been steadily developing in the European and North American markets as an asset class in its own right, has been an established asset class for many years in this country.
Dr. Jan Linsin, Head of Research Germany

This is the conclusion drawn in a current analysis prepared by the integrated commercial real estate services company CBRE.


Undiminished interest of institutional investors despite rising prices in the metropolitan regions and swarm cities

In the first three quarters of 2017, 203 transactions comprising around 80,300 residential units (1,600 residential units more year-on-year) and living space of 5.1 million sq m (increase of 277,000 sq m), were registered. Despite an increase in large portfolio transactions, the average portfolio size consisted of around 400 residential units, as in the year earlier period.

Konstantin Lüttger, Head of Residential Investment
With parameters remaining unchanged, the growth in the transaction volume on the housing investment market is primarily attributable to the acceleration in purchase prices in the top locations of Berlin, Düsseldorf, Frankfurt, Hamburg, Cologne, Munich and Stuttgart, as well as in swarm cities such as Münster and Leipzig.
Konstantin Lüttger, Head of Residential Investment
Michael Schlatterer, Team Leader Market Intelligence
Within the space of a year, the average selling price per residential unit has climbed 29 percent to currently around €122,300 and the weighted purchase price per sq m has risen by 24 percent to €1,920.
Michael Schlatterer, Team Leader Market Intelligence

“Despite these price hikes, we can see no change in the investment strategies of investors. The interest in this segment of institutional investors and of real estate companies specialised in German residential property, both in Germany and abroad, remains unchecked, which signifies that investment in ‘German resi’ remains attractive in spite of higher purchase prices,” Lüttger explains.


Property developers as the strongest seller group

“The growth in population figures, particularly in urban areas, keeps demand for living space running high, particularly in regions with strong pull factors. This explains why property developers count among the strongest group of players on the seller side through the sale of multi-storey apartments ready for occupancy and properties under construction sold before completion in the context of forward funding or forward purchases,” Linsin says. This group sold residential portfolios worth €2.8 billion.

On the buyer side, listed real estate companies/REITs proved very active in continuing their pursuit of their growth targets with existing stock, above all in Berlin and North Rhine-Westphalia. At €3.3 billion, they contributed 34 percent to the overall investment volume through acquiring 29,670 residential units in total with prices averaging around €1,740 per sq m. “As part of the regional concentration on strategic core markets and ongoing portfolio streamlining activities, listed real estate companies belong to the strongest net buyers, along with the group of open-ended real estate and special funds,” Linsin comments. The latter invested €2.5 billion, thus contributing 26 percent to the overall transaction volume. The investment focus generally targeted major cities and their affluent suburbs as well as prosperous university towns. At just under 19,080 residential units traded, the average purchase price stood at €2,200 per sq m of living space. This group allocated some 57 percent of the capital invested to property developments and paid an average of €4,090 per sq m of living space. “In addition, they displayed greater interest in the asset class of student accommodation and micro-apartments. With changes in the residential infrastructure and the demand patterns of young people for temporary accommodation, this asset class is considered a relatively safe investment. Good growth prospects have prompted the first real estate funds to focus exclusively today on micro-apartments in the market,” Linsin explains.

Positive outlook for the full year 2017

“We anticipate that the dynamic trend on the German housing investment market is set to continue. Outstanding fundamental data and positive framework conditions are eliciting a growing interest from foreign institutional investors from the Middle East. Consequently, residential portfolios will remain one of the most popular investment targets,” Linsin states. “Especially Berlin remains a favourite with domestic and international players, and investment activity will stay brisk here in particular,” Schlatterer adds. “All in all, there are a number of large-scale portfolios in the investment pipeline. We expect the allocated transaction volume in the German housing investment market to have exceeded €13 billion by the end of the year, which is roughly the average seen in recent years,” Lüttger predicts.


Residential portfolio transactions in Germany (upwards of 50 residential units)










Source: CBRE Research, Q3 2017


Market for residential portfolios in Germany








Source: CBRE Research, Q3 2017



Konstantin Lüttger
Head of Residential Investment Germany
+49 (0)69 17 00 77 29

Michael Schlatterer
Team Leader Market Intelligence
+49 (0)30 726 154 156

Dr. Jan Linsin
Head of Research Germany
+49 (0)69 17 00 77 663



About CBRE

CBRE Group, Inc. (NYSE:CBG), a Fortune 500 and S&P 500 company headquartered in Los Angeles, is the world’s largest commercial real estate services and investment firm (based on 2016 revenue). The company has more than 75,000 employees (excluding affiliates), and serves real estate investors and occupiers through approximately 450 offices (excluding affiliates) worldwide.

CBRE offers a broad range of integrated services for the entire lifecycle of a property, from strategic and technical advice such as in sales and acquisitions or renting and letting, to managing and valuing properties to portfolio, transaction, project and facility management. CBRE offers individual advice for all asset classes from a single source.

Since 1973, CBRE Germany has been represented by its head office in Frankfurt am Main; there are further branch offices in Berlin, Düsseldorf, Essen, Hamburg, Cologne, Munich, Nuremberg and Stuttgart.