GREIX: German city centres outpace outskirts in 2025

The latest German Real Estate Index (GREIX) reveals that by 2025, residential real estate prices in Germany's major cities are seeing a widening gap between city centres and their outskirts.

GREIX, 1 April 2026

After a period where central locations experienced sharper declines, they are now growing more significantly than peripheral areas.

This trend mirrors previous market cycles (2006–2022), where downtown areas saw faster price increases during periods of growth. The price ratio between city centres and outskirts, which fell to 1.25 in 2024, has risen to 1.27 in 2025. This means apartments in central neighbourhoods are, on average, 27% more expensive than those outside the centre, a significant jump from a 5% premium in 1990.

Cities like Düsseldorf and Munich are seeing strong growth in their city centres, with prices rising by almost four and over three percentage points higher, respectively, than on their outskirts. Berlin, however, is an exception, with price growth in its outlying neighbourhoods slightly exceeding that of the city centre.

Within the "Top 7" cities, price differences are substantial, with Berlin having the largest disparity. For example, a square meter in central Berlin (Mitte) can cost more than twice as much as in the most affordable district (Spandau).

In Cologne, central areas cost nearly double that of Porz (€6,000/m² vs. €3,200/m²). Frankfurt shows a similar gap, with Westend/Innenstadt costing around 85% more than Frankfurt West (€7,300/m² vs. €4,000/m²).

Munich remains the most expensive. Even its most affordable neighbourhood, Moosach-Milbertshofen (€7,500/m²), is pricier than the most expensive areas in other major German cities. Altstadt-Maxvorstadt is the priciest at €11,900/m².

While Stuttgart has the most uniform price structure, there's still over a 50% price difference between its most expensive neighbourhood, Mitte-Nord (€5,500/m²), and its cheapest, Neckar-Ost (€3,600/m²).

Jonas Zdrzalek, project leader of GREIX at the Kiel Institute for the World Economy, said: "We are observing a trend reversal in 2025. After prices in downtown neighbourhoods declined disproportionately during the period of rising interest rates, a counter-movement has emerged. One hypothesis is that residential real estate in central locations is more sensitive to changes in interest rates because of its lower risk profile."

The GREIX is a joint project of the local expert committees for property values (Gutachterausschüsse für Grundstückswerte (GAAs)) and the Kiel Institute for the World Economy.