Demographic development in Germany is becoming a crucial issue of specific location for real estate investors. An analysis by Wüest Partner reveals that by 2040, growing and shrinking municipalities will exist directly alongside each other in almost 60 per cent of districts. This means that a district as a whole may appear stable, while some municipalities gain population considerably and others simultaneously lose residents.
For a sound and long-term assessment of real estate locations, an exclusive focus on supra-regional data proves insufficient. The new population forecast, based on a nationally consistent methodology, maps population development for all 10,753 inhabited towns and municipalities until 2050. It not only forecasts the total population but also detailed developments by gender and 17 age groups. This small-scale data is available for individual location and market analyses.
Precise Data for Informed Decisions
The provision of this detailed forecast data enables investors, project developers and municipalities to precisely identify local growth potentials, evaluate demographic risks early, and make long-term decisions on a reliable data basis. Stefan Möller, Expert Data Scientist at Wüest Partner, emphasises that for real estate decisions, the actual development of population and age structure on site is crucial. He notes that growth, shrinkage and ageing can already show significant differences within a district, and the new forecast provides a uniform basis for early detection of such developments.
An example of this is the Alb-Donau-Kreis. While some of its 55 towns and municipalities experience growth of approximately 10 per cent between 2024 and 2040, others record a population decline of around 9 per cent during the same period. The analysis also shows significant differences between types of municipality: The population of large cities is expected to grow by an average of 1.9 per cent by 2040, whereas it will decrease by 6.8 per cent in rural municipalities, by 5.2 per cent in small towns and by 4.0 per cent in medium-sized towns. The proportion of the population living in large cities thus rises from 32.0 per cent in 2024 to 33.6 per cent in 2040.
Impact on Housing Demand
In addition to population figures, the age structure is also changing almost nationwide. By 2040, an increase in people aged 65 and over is expected in approximately 93 per cent of municipalities, while the number of under 18-year-olds will be in decline in about 94 per cent of municipalities. It should be noted that ageing does not necessarily imply a population decline; growing municipalities can also experience significant ageing simultaneously. These developments are highly relevant for real estate markets, as population development and age structure significantly influence housing demand, preferred housing types, and long-term location prospects.
In stagnating or shrinking markets, vacancy, marketing, and exit risks can increase. At the same time, the ageing of society can generate increased demand for specific housing types, particularly for smaller, well-connected and age-appropriate flats. The small-scale forecasts thus provide an essential basis for identifying regional and municipal growth potentials, analysing changes in age structure, and deriving future demand potentials for different residential and real estate segments. Wüest Partner provides this forecast data and supports companies, investors, project developers, and public institutions in its evaluation and classification.
