Landlords looking for the Germanys best Buy-to-Let areas in 2018 should consider Berlin, Saxony & Saxony –Anhalt in the East and the giant diverse state of North Rhine-Westphalia in the West. The Investix ‘Housing Report’ makes great reading for landlords looking for the best Buy-to-Let areas in Germany.

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1. Berlin / Brandenburg

Berlin Brandenburg region – metropolitain of central Europe

Berlin, regarded by many as the “New York of Europe”, has a population of 3.5million. The German capital is the second largest city in the EU. Rents and costs of living in Berlin remain low. Berlin’s employment growth is outpacing the rest of Germany and is at the top of economic rankings. Berlin is currently seeing a net increase of residents which is driving rental demand and rents upwards.

Brandenburg – Gateway to Eastern Europe

With major north-south and east-west trade routes meeting here, Brandenburg is the crossroads of the new Europe and a gateway to Eastern Europe’s expanding markets. To take advantage of this ideal location, the region has developed an ultra-modern logistics infrastructure. The region is quickly becoming a major aerospace cluster, with over 70 industry companies, including Deutsche Lufthansa, MTU Aero Engines, and Rolls-Royce Germany represented here.

  • Total population exceeds 6 million
  • Biggest city, Berlin (3.47 million)with capital of Brandenburg Potsdam
  • In last 7 years, the number of employees increased by 18.6 % – economy is booming
  • Berlin’s population is expected to grow by a further 10.3 % by 2030
  • Potsdam population is set to attract even more new citizens, with growth predicted to hit 11.6 %.
  • Rents in Berlin has increased by nearly 70 percent between 2004 and 2016.
  • In Berlin available rental apartment rate is almost zero; in Potsdam lower than 1 %

Top 5 Buy-to-Let cities in Berlin / Brandenburg

Berlin Potsdam Cottbus Brandenburg Eberswalde
Population: 3.47 million 164,042 102,129 2.45 million 41,331
Purchase prices avg.: €3.706 €2,805 €1,591 €1,317 €704
Rents/sqm avg.: €10.9 €9.99 €6.87 €5.48 €5.64
Yields avg.: 3.3% 3.7% 4% 6% 5.9%

Berlin’s Buy-to-Let landlords can still turn a profit, it seems, but their room for manoeuvre is narrowing.

Denise KnoblauchAdministration Manager

Helping investors from all over the globe to Source, Structure, & Manage their real estate investment portfolios in Germany.

2. North Rhine-Westphalia

NRW – The Industrial Heartland of Germany

North Rhine Westphalia is the most populous state of Germany, with a population of approximately 18 million, and the fourth largest by area. Four of Germany’s ten largest cities—Cologne, Düsseldorf, Dortmund, and Essen— are located within the state, as well as the largest metropolitan area on the European continent, Rhine-Ruhr.

More foreign investments flow into the business location NRW than into any other German state: The economic center accounts for 28.5 percent of all foreign direct investments (FDI) in Germany. Some 18,000 international companies have already discovered the investment location and control their German or European operations from NRW. These include global companies such as 3M, BP, Ericsson, Ford, Huawei, QVC, Toyota and Vodafone.

  • 18,000 international companies based there
  • Population of 17.6m
  • Major cities of Duisburg Dusseldorf, Dortmund, Essen, Bielefeld, Munster, Bonn, Cologne
  • €196 billion in foreign direct investment at the end of 2013
  • Contributes €646 billion (20%) of German GDP
  • 15m people live within 500km radius of Dusseldorf
  • Germany’s strongest economic output and largest population
  • 72 Universities
  • 2 major international airports ( Dusseldorf & Cologne)

Top 5 Buy-to-Let cities in North Rhine-Westphalia

Cologne Dusseldorf Dortmund Duisburg Essen
Population: 1.047 nmillion 604,527 580,511 485,465 573,784
Purchase prices avg.: €3.384 €3.435 €1.533 €1.074 €1.445
Rents/sqm avg.: €13.92 €12.06 €9.38 €6.35 €8.10
Yields avg.: 3.2% 3.1% 4.3% 5.7% 5.3%

North Rhine-Westphalia is a prosperous state, with a population of more than 18 million, the majority of which are tenants.

Oliver TrepteMaintenance Manager

Helping investors from all over the globe to Source, Structure, & Manage their real estate investment portfolios in Germany.

3. Saxony

Silicon Saxony – Europe’s largest microelectronics cluster

Saxony is the birthplace of German industrialization, and long-standing traditional industries – such as machine construction and automotive manufacturing – continue to flourish there. For example, over 650 suppliers in “Autoland Saxony” feed their products to five vehicle and engine production sites for Volkswagen, Porsche, and BMW. Saxony’s modern claim to fame is its leading position among the world’s most innovative locations for microelectronics. Large global corporations based there – such as Globalfoundries, Infineon, and Siltronic AG – have attracted even more microelectronic companies to the area and made “Silicon Saxony” the center of Europe’s microelectronic industry. All together, there are nearly 200 companies there in the semiconductor industry employing more than 20,000 people. The innovative strength of this industry is backed by those of the environmental technology and nanotechnology sectors, and together they have made Saxony’s one of Germany’s fastest-growing economies. The driving force behind these achievements is Saxony’s people: the highly skilled and motivated workers, the innovative researchers, and the investor- friendly public officials. Moreover, Saxony’s central location and superb infrastructure provide optimal conditions for transportation within Germany and Europe.

  • Since 1990, about 6,000 companies have set up or purchased business premises in Saxony.
  • Saxony’s economy has increased by more than 20 percent since 2000; thus, exhibiting the second highest GDP growth rate of all German federal states.
  • Top selling branches include the automobile industry, machine and plant construction as well as the microelectronics / ICT sector.
  • In 2017, Saxony’s industry generated a total turnover of 67.4 billion euros
  • Most employees work in services (68.9%), while 29.7% work in industry and only 1.4% in the agricultural sector
  • The most important industrial branch continues to be the automobile industry with a share of 27.0 percent of all sales.

Top 5 Buy-to-Let cities in Saxony

Leipzig Dresden Zwickau Chemnitz Plauen
Population: 544,479 536,308 104,146 243,521 66,287
Purchase prices avg.: €2.742 €1.968 €923 €1.392 €584
Rents/sqm avg.: €7.53 €8.17 €5.44 €5.51 €4.00
Yields avg.: 3.8% 3.4% 5.6% 5.4% 6%

Medium sized cities in Saxony offer strong rental yields between 5%-6%.

Ronny HeinickeRPI Sales Manager

Providing a “one stop in-house solution” for foreign investors looking to maximise their investment potential from the German real estate market.

4. Saxony-Anhalt

On the way to being one of the key European Innovation Leaders

The state has a population of over 2.27 million inhabitants. It is the 8th largest state in Germany by area and the 10th largest by population. Saxony- Anhalt has well-developed rail networks, motorways and inland waterways. In the latest years Saxony-Anhalt’s demonstrates not only the strong economic performance of the region’s entrepreneurs and employees but also the state’s effective economic and public policies as well as its high quality business locations. The state prides itself on its attentiveness to customer needs, highly qualified personnel and exceptional infrastructure. It has an attractive commercial and scientific hub, with rapidly expanding industries. It has many universities, technical colleges and research institutes with an international bias.

The Industry in Saxony-Anhalt is widely diversified and includes everything from automotive supply production and mechanical engineering to information technology, biotechnology, and medical technology. However, the real economic powerhouses are the logistics, renewable energies, and chemical industries. The photovoltaic industry in Saxony-Anhalt, for example, employs approximately 4,000 people. Big names like Bayer, Total, and Dow Chemical back a flourishing chemical industry.

  • Population of 2.27 million
  • Massive investments goes into the chemical industry
  • Highly competitive infrastructure
  • Most important industries are chemical, Mechanical and plant engineering and automotive
  • Over 190 plants for the food industry
  • Numerous wind farms producing wind-turbine energy
  • Biggest companies include Bayer, Total, and Dow Chemical

Top 5 Buy-to-Let cities in Saxony-Anhalt

Magdeburg Halle Dessau-Rosslau Wittenberg Halberstadt
Population: 232,306 232,470 88,693 50,408 43,224
Purchase prices avg.: €1.427 €1.493 €810 €831 €699
Rents/sqm avg.: €6.75 €5.46 €5.70 €6.31 €5.55
Yields avg.: 5.4% 5.5% 6% 6.5% 7%

Saxony Anhalt is well known of high developed renewable energy, automobile manufacturing, and chemical industries!

Andreas MeggerTeam Leader Property Management

Helping investors from all over the globe to Source, Structure, & Manage their real estate investment portfolios in Germany.

5. Other Locations

For all other locations in Germany, download the Housing Report from the RESOURCES section of the website or contact one of our Investment Consultants.

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