The price level in all German Top 7 cities continues to rise, while immigration increases population growth in the surrounding areas and in b-cities.
In the current empirica newsletter, the real estate price index III is being discussed for 2018, revealing a completely new trend. Low interest rates and the lack of more profitable investment alternatives continue to boost rental and purchase prices. For example, prices in the seven A-cities (including Berlin, Hamburg and Munich) increase by 11.9 and 5.7 percent, while price growth in the 14 B-cities, such Hanover, Leipzig and Mannheim is at 8 and 3.6 percent, and therefore lower.
According to empirica, however, it is this price growth in A-cities, which triggers a higher population growth in B-locations and surrounding metropolitan areas. Cities such as Bremen or Mainz are now growing more strongly than Berlin, as many people increasingly prefer Berlin´s surrounding area as a place of residence. As early as 2016, the capital was overhauled. At that time, immigration there was at 15 percent, while the other two cities grew by an average of 16 percent.