Kiel Institute for the World Economy
GREIX Index, from the Kiel Institute for the World Economy
Germany's residential price recovery is losing momentum. The German Real Estate Index (GREIX), published by the Kiel Institute for the World Economy (IfW), shows owner-occupied apartments rose just 0.3% in nominal terms in Q2 2026 versus the previous quarter, while detached houses gained 1.8%. Multi-family blocks — the segment of most interest to institutional investors — fell 0.9% over the same period. Year-on-year, apartments are up only 0.4%, detached houses 1.9%, while multi-family blocks are down 3.5%.
Adjust for inflation and the picture turns negative across the board. Apartments lost 0.9% in real terms quarter-on-quarter and multi-family houses 2%, even as detached houses eked out a 0.6% gain. On an annual basis, every segment lost real value: apartments were down 2.1%, detached houses 0.7% and multi-family houses 5.9%. An apartment sold today, in other words, may fetch slightly more euros than it would have a year ago, but those euros buy less.
Jonas Zdrzalek, GREIX project manager at the IfW, points to a leading indicator that has flagged this kind of slowdown before: the extent to which sellers reduce asking prices during the marketing period. Price reductions are becoming more common again, and GREIX's analysis of 45 quarters since 2015 shows a clear relationship with subsequent price movements. When reductions increase compared with a year earlier, price growth in the following quarter tends to weaken; when they ease, momentum tends to improve.
A patchier map than the headline suggests
Beneath the national averages, the largest cities are moving in different directions. Düsseldorf apartments rose 1.2% quarter-on-quarter and Cologne 0.1%, while Leipzig was essentially flat, down 0.1%. Frankfurt am Main fell 0.6% and Stuttgart 1.6% — evidence that the correction is not yet over everywhere. Data for Berlin, Hamburg and Munich has yet to be published.
Beyond the big eight, the divergence is sharper still. Bonn apartments rose 2.8% on the quarter, Münster 2.1% and Dortmund 1.9%, while Bochum slipped 0.5%. No single narrative — recovery, stagnation or correction — fits the country as a whole.
Transaction activity tells a different story from prices. Apartments changed hands 9.3% more often in Q1 2026 than a year earlier, with transaction volume up 12.1%. Houses and multi-family blocks, by contrast, saw activity little changed from the year before. Provisional Q2 figures suggest apartment transactions are still climbing, though at a slower pace than in earlier quarters, with the usual caveat that delays in recording contracts mean the final numbers could change.
That distinction matters because GREIX is based on purchase-price data collected by Germany's local valuation committees from completed, notarised transactions — prices actually agreed between buyers and sellers, rather than asking prices or valuation estimates. More apartments are changing hands, but nominal prices are barely moving and in real terms values continue to decline.
REFIRE: The figures add another dimension to what Vonovia's half-year results suggested in our earlier report on the company (German housing recovers faster than the capital behind it). Vonovia's own portfolio revaluation rose 1.1% excluding investment, providing evidence that appraised values have begun to recover. GREIX, however, shows multi-family transaction prices falling 3.5% year-on-year in nominal terms and 5.9% in real terms, the weakest performance of any category tracked.
The measures are not directly comparable: Vonovia's figures reflect the appraised value of a particular institutional portfolio, while GREIX records prices achieved in notarised transactions across its participating markets. But the contrast is revealing. Residential operating fundamentals have recovered, appraised values have begun to rise, yet transaction prices remain under pressure. The recovery is real — but it is travelling through the market at very different speeds.