House prices are rising again - buyers are rushing back onto the market
After taking a breather in 2023, house prices are picking up again in many regions. In metropolitan areas, attractive medium-sized cities and well-connected suburbs, we are seeing shorter marketing times, more competition per property and smaller price discounts. The main drivers: stabilised or slightly lower construction interest rates, limited supply due to low construction activity and pent-up demand that is becoming active again. For buyers, this means acting faster and in a more structured way. For sellers: price realistically, market professionally - and use timing.
Why are prices turning? Three market-relevant forces
Interest and financing: Even a fall in building interest rates of 0.3-0.5 percentage points will noticeably improve the monthly instalment and bring previously marginal households back into the market. Assumption: interest rate band 3.5-4.2 % p.a., fixed interest rate for 10 years, initial amortisation 2-3 %.
Supply shortage: New construction remains expensive. Increased construction costs, stringent regulations and a shortage of skilled labour are putting pressure on completions. Existing properties with good energy efficiency are rare - and generate bonuses. Even properties in need of modernisation are finding buyers if the location, floor plan and potential are right.
Utilisation pressure and life events: Family growth, job changes, inheritances - decisions are not postponed forever. Many prospective buyers are once again accepting standard market price levels as long as the quality of the location and substance are convincing.
What does this mean for buyers? Act like professionals
The new dynamic increases the pace. Those who are prepared can secure good properties without overpaying.
- Financing commitment first: Current bank confirmation of the budget, ideally with fixed interest rate scenarios (10/15 years).
- Sharpen your search profile: Define location corridors, minimum living space, efficiency class, willingness to modernise.
- Check price range based on property: Comparative prices, standard land values, year of construction cluster; include additional costs (property transfer tax, notary, estate agent).
- Substance check early: Roof, heating, windows, electrics, damp - obtain a rough quote for refurbishment.
- Quick but fact-based decisions: Only book with a clear to-do list and deadline.
- Negotiating with arguments: Energy performance certificate, upcoming investments, market comparison - not with a „sentimental price“.
Financing quick check: 0.5 % point makes the difference
Assumption: purchase price € 500,000, 20 % equity, loan € 400,000.
Interest rate 4.2 % vs. 3.7 % p.a. results in approx. € 2,000 less interest burden p.a. or around € 167 per month. With an initial repayment of 2.5 %, the total instalment falls comparably. Conclusion: Even small interest rate movements increase your room for manoeuvre or compensate for a moderate price increase. Individual conditions may vary - be sure to obtain personalised offers.
Opportunities for sellers - but differentiated
Good location remains the main value driver. Bids are picking up again in sought-after neighbourhoods and bidding processes are back - albeit selectively. Properties with a solid energy class (A-C) are achieving premiums; houses with E-H are marketable if costs and potential are clearly analysed.
What works particularly well now? Single-family homes with family floor plans, semi-detached houses with gardens, terraced houses with reasonable energy performance and flats with balconies in locations close to public transport. We see less momentum for single-family homes requiring intensive refurbishment, unless the price realistically reflects the need for investment.
Typical errors & solutions
- Error: Just stare at the purchase price. Solution: Calculate total costs including ancillary purchase costs, modernisation and energy consumption.
- Error: Select fixed interest rate too short. Solution: Scenario check with 10-15 years; choose amortisation so that residual debt remains predictable.
- Error: Booking without a firm commitment. Solution: First confirmation, then reservation with a clear deadline and list of documents.
- Error: Underestimate refurbishment costs. Solution: On-site appointment with a specialised company, two comparative offers, allow for time schedule.
Market in figures - what we pay attention to
Assumption-based orientation, varying by region: In sought-after locations, we currently see price premiums of 1-3 % compared to the previous quarter, in balanced locations sideways up to +1 %. Marketing times are being reduced in some cases from 12-16 to 8-12 weeks. Price discounts in notarised contracts are falling from the previous 6-8 % to 2-4 %, assuming realistic offer prices.
Signals of increasing demand: More enquiries per exposé, higher utilisation of appointments within the first 10 days, earlier receipt of financing confirmations from banks and selective bidding procedures for energy-efficient properties.
- Monitoring tips: Compare offer duration (days on the market) per micro-location.
- Energy class at a glance: A-C stable to rising; D-F differentiated; G-H with price adjustment, but good opportunities with a transparent renovation roadmap.
- Plan for incidental purchase costs: Depending on the federal state, an additional 8-12 %; buffer liquidity.
- Realistic room for negotiation: Lower in prime locations, still present in peripheral locations - check on a property-by-property basis.
Important: The market is not a monolith. Micro-location, condition, energy efficiency and supply situation have a stronger impact than the general trend. If you assess these factors properly, you will make better decisions - whether as a buyer or seller.
Next step
Would you like to accurately assess your purchasing power or determine the optimum selling price? We analyse the location, property quality, energy profile and comparative offers - quickly, soundly and discreetly. Arrange your non-binding initial consultation now.
