German rental growth loses momentum as Berlin sees first decline in years, Cologne surges 6%

National picture

The Greix index from the Kiel Institute for the World Economy (IfW) shows that asking rents across 37 German cities and regions rose 0.8% quarter-on-quarter and 3.0% year-on-year in the second quarter of 2026. Consumer price inflation ate into those nominal gains, leaving real growth at just 0.3% year-on-year. The quarter-on-quarter real change was minus 0.4%, marking the second consecutive real decline. The weighted average cold rent across all surveyed areas stood at €14.30 per square metre.

Berlin's reversal

Berlin was the only one of the eight largest cities to record a year-on-year drop, with asking rents falling 0.8%. The capital's average cold rent slipped to €15.30 per square metre, a stark contrast to the national trend and to its own rapid growth in earlier years. The IfW noted that the gap between Berlin's decline and Cologne's surge amounts to nearly seven percentage points.

Winners and losers among cities

Cologne led the pack with a 6.0% year-on-year jump, followed by Hamburg (5.1%) and Düsseldorf (4.1%), all well above the national average of 3.0%. Munich, Frankfurt and Leipzig posted moderate gains of 3.7%, 2.8% and 2.8% respectively, while Stuttgart managed only 1.3% despite being one of the most expensive markets. Outside the top eight, quarterly increases were strongest in Kiel (2.0%), Karlsruhe (1.8%), Wiesbaden (1.6%), Münster (1.6%), Lübeck (1.5%), Essen (1.4%), Wuppertal (1.4%) and Potsdam (1.3%). A handful of cities saw declines: Braunschweig (minus 0.9%), Erfurt (minus 0.8%), Aachen (minus 0.4%) and the Rhein-Erft district (minus 0.2%).

Price levels and new-build premium

Munich remained by far the most expensive city, with an average cold rent of €23.70 per square metre. Frankfurt (€17.80), Hamburg (€16.50) and Stuttgart (€16.30) followed, while Leipzig was the cheapest among the eight at €10.50. The IfW stressed that high price levels do not automatically mean strong growth, pointing to Stuttgart as an example.

A high price level does not automatically mean that prices continue to rise sharply.

New-build apartments commanded a significant premium: the average cold rent for new units was €19.00 per square metre, compared with €13.90 for existing stock, a gap of about 36.6%. In Munich, new-build rents reached €27.10 per square metre, while Leipzig's new-build average was €14.60.

Market fragmentation

The wide spread in rental dynamics, from Cologne's 6.0% surge to Berlin's decline, reflects a growing fragmentation of the German rental market. IfW researcher Zdrzalek noted that the market is splitting into individual sub-markets rather than moving uniformly.

A high price level does not automatically mean that prices continue to rise sharply, and a low level does not mean that a market remains calm.

The institute's long-run data show that since 2015, the cold rent index for furnished unlimited-term apartments has tracked closely with regular unfurnished listings, with the regular index now just above 151 points.