In view of the upcoming parliamentary elections in Berlin on 20 September, existing investors are paying increased attention to locations outside Berlin's city limits. Price development in these regions offers a significant incentive for investment. While earlier market phases were characterised by a general price increase across various sub-markets, the picture has been more uneven since 2022. In Berlin and its surrounding area, some segments have experienced significant price corrections, while others are stabilising or already showing rising values again.
The price development for multi-family houses in central Berlin illustrates this: the average purchase price fell from EUR 2,847/m² in 2022 to EUR 2,040/m² in 2024, with a slight recovery to EUR 2,200/m² for 2025. In contrast, properties in Potsdam (medium to good structural condition) recorded a high and stable price level throughout the period. In 2025, these were at EUR 2,960/m², which significantly exceeded the average prices paid in Berlin. At the same time, in the same year, houses in the Potsdam-Mittelmark district, built up to 1948, were traded in the Berlin surrounding area for an average of EUR 1,472/m². This price range of EUR 1,488/m² for properties often only a few kilometres apart underscores the need for a detailed analysis of regional and object-specific factors for successful investments.
Berlin and Potsdam are in different phases of the price cycle. Berlin experienced a pronounced upward phase, followed by a significant correction. In Potsdam, these fluctuations were much less pronounced. Investors who are banking on a recovery after the price correction are more likely to find the corresponding starting position in the capital. An investment in the surrounding area must therefore always be evaluated based on the specific development of the respective sub-market. At the property level, clear regulatory differences still exist. In Berlin, the conversion of rental flats into owner-occupied flats in buildings with more than five units generally requires approval until the end of 2030. In addition, in 82 social preservation areas, certain structural and property-related projects require additional approval.
Regarding rent setting, the differences have narrowed. Since 1 January, the rent control and reduced cap have applied in 36 Brandenburg towns and municipalities, including many growth areas in the Berlin surrounding area. A detailed look at the respective level is therefore essential for a regulatory comparison of both markets. A viable investment in the surrounding area is characterised by positive population development and quick access to Berlin. Katrin Zakrzewski, Director Real Estate Finance Sales, Region East, Deutsche Bank AG, highlighted the particular attractiveness of locations in the regional train network from a financing perspective in the SCHICK webinar “Opportunity Market Speckgürtel”. With increasing distance from Berlin, a location must generate demand more on its own strength, with local jobs and stable housing demand gaining importance.
The economic potential for tenants is illustrated by a sample calculation: For an energy-efficient new build flat of 80 square metres, the difference between EUR 15 per square metre in the surrounding area and EUR 20 in Berlin is EUR 400 per month. This amounts to EUR 4,800 per year and EUR 48,000 over ten years. Although commuting costs reduce this difference, the saving remains significant enough to influence housing decisions in favour of well-connected peripheral locations. Berlin remains a primary residential investment market in Germany. In parallel, independent sub-markets with their own price trends and demand fundamentals are developing in the commuter belt.
- —The Berlin search radius for investors is expanding.
- —The surrounding area is not merely becoming a substitute for the capital.
- —Additional opportunities are emerging along the main transport arteries.
- —However, with increasing distance, the location risk increases.
For investments, it is therefore crucial to evaluate each sub-market individually. The economic influence of the Berlin residential investment market extends beyond the city limits, but not indefinitely. The commuter belt forms independent markets, whose analysis requires a precise assessment of local demand and the specific price cycle. This was emphasised by Jürgen Michael Schick, MICHAEL SCHICK IMMOBILIEN GmbH & Co. KG, in his market commentary.
