'Steep decline in real estate prices in Germany'

German real estate prices fell sharply in the second quarter compared to the same period last year, the most significant drop since 2000 when such statistics were introduced. Apartments and houses fell in price by an average of 9.9 percent compared to the second quarter of 2022, the DPA news agency reported, citing the Federal Statistical Office.

Compared to the first quarter, the 1.5 percent drop was still less than the previous two. Back then, real estate prices fell by 2.9 and 5.1 percent. It is pointed out that prices have been falling since they peaked in the second quarter of last year. The main reason for the change in the real estate market after years of boom is the sharp increase in interest''rates in construction, which significantly increased the cost of loans.

Prices fell in the second quarter in both urban and rural areas, but especially in urban areas. Berlin, Hamburg, Munich, Cologne, Frankfurt, Stuttgart and Düsseldorf saw particularly large price falls relative to the same quarter of the previous year. There, prices for one- or two-family homes fell by 12.6 percent, and buyers could purchase apartments on average 9.8 percent cheaper than a year earlier.