The prices for properties in Cologne have increased in the first half of 2014 in virtually all locations and markets compared to the previous year. The reason for this is the continuously increasing population which, together with the historically low interest level, explains the sustained high demand for living space in the million-strong Rhineland metropolis. This is the finding of the “Property Market Report for Germany 2014/2015” published by Engel & Völkers.
According to estimations by Engel & Völkers, the top prices for apartments in the first half of 2014 have increased to 10,000 euros per square metre. “These prices are asked for mint condition properties in top locations such as Rheinauhafen and Lindenthal”, says Burkard Brinkmann, Managing Director at Engel & Völkers in Cologne. For this reason, Cologne is exhibiting the highest prices per square meter for apartments in Germany behind other metropolises like Munich, Hamburg, Berlin, Frankfurt and Stuttgart. The high price level is also apparent in the ranking of the transaction volumes of apartments in 2013. With a turnover of approximately 1.25bn euros, Cologne achieved 4th place. Cologne sits in the same position in the ranking for detached and semi-detached houses.
In good locations like parts of Braunsfeld and Klettenberg, the price band for apartments increased from 2,600 to 6,000 euros per square metre in the first half of the 2014. The prices for rented apartments used to start at 5.50 euros per square metre in humble locations and reached up to 21 euros per square metre in prime locations. Buyers in the upper price bracket paid up to 3.85m euros for detached and semi-detached houses.
Urban locations are becoming popular amongst young buyers
Detached houses and villa locations in Marienburg, Rodenkirchen, Lindenthal-Deckstein, Junkersdorf and Hahnwald remain especially popular for potential buyers. In these parts of the city, properties with gardens and a living space larger than 180 square metres are sought after. Belt locations such as Neuehrenfeld, Sülz and Bayenthal profit above all from the increasing demand for living space in urban regions. Young families are looking for old builds in good condition here. Among well situated ‘best agers’, lavish apartments in Lindenthal, Braunsfeld and in inner city locations are enjoying a lot of popularity.
Outlook: Housing supply will remain scarce
Due to this increasing popularity, locations near to the centre with good infrastructure may earn additional value. The city is tackling higher demand by accepting numerous new building projects. “We predict that property prices will continue to rise not only in the prime but also in the good and average locations,” according to Burkard Brinkmann. Since the housing supply is likely to remain scarce despite increasing new building activity. Nevertheless, buyers are being increasingly critical of the value for money ratio.