The most expensive places to rent in Germany

The research company F+B has compiled its Rent Index 2020, showing that residential rents across the country are rising more slowly than in the past. The annual study also reveals the most expensive places to live in Germany and contains a few surprises.

Even in the corona-ravaged year of 2020, rents DID still rise across the country, but for the third year in a row, they rose at a lower rate than the previous year. Accordingly, comparable rents in Germany increased by 1.7% in 2020, while in 2019 they increased by 1.8% and 2.2% in 2018.

To compile their Rent Index, F+B looked at the official rent indices of 351 cities and towns with more than 20.000 residents, covering the rental costs of millions of inhabitants. Rent indexes show increases or decreases in both new contracts and existing rents. Local comparative rents derived from these rent indices should provide an accurate picture of how much tenants spend on rent.

These rent indices are collected in most of Germany’s larger cities, as well as many smaller towns. They are important for landlords, tenants and investors, as they can be used officially, for example, to set rent prices or justify rent increases.

F+B’s Rent Index highlights how suburban areas around major cities are becoming more expensive. According to the index, the most expensive area in Germany is the municipality of Karlsfeld, situated just 12 kilometres from the centre of Munich. Three other Munich suburbs - Germering, Dachau and Erding - also feature in the top 10 most expensive areas, reflecting the current pressure on Munich’s housing market.

Stuttgart remained Germany’s most expensive city in 2020, with average net rent 46% above the national average, with tenants paying an average of €10.38 per sqm (per month). However, three areas in Stuttgart’s suburbs - Leinfelden-Echterdingen, Tübingen and Ludwigsburg - also climbed into the top 10.

With the city's suburbs seeing significant rent increases at the expense of the core, Munich fell to seventh place, (paying an average of €9.71 per sqm) after being knocked from the top spot for the first time in 20 years in 2018. Three other German cities - Wiesbaden, Frankfurt and Hamburg - made it into the Top 20 in their own right.

In Frankfurt the average rent is €8.69, in Hamburg €8.62 and in Düsseldorf €8,50. In Berlin the average is €7.40 in the western part of the city and €6.65 in the east. 

In eastern Germany as a whole rents are lower than in the west, with Jena, Potsdam and Rostock ranked between 95 and 100 and paying the median rent of €6.76 to €7.10. Most of the bigger cities in the east are priced lower, with Erfurt €6.68 on average, and Dresden at €6.17.

The Rent Index shows that while rents have not risen as sharply in major cities in the past few years, suburban areas and areas around major cities are getting more expensive. The cost of buying a house or apartment has been still rising steadily, however, with house prices rising by 10% and apartment prices by 11% despite the impact of the pandemic.