Key facts
- German commercial property prices fell in the second quarter.
- The decline reversed a fragile recovery in the sector.
- Inflation and interest rate hikes are cited as causes for the downturn.
- Office and retail building prices decreased by 1% year-on-year.
- Residential property prices continued to rise, but at a slower pace.
Commercial real estate prices in Germany experienced a decline in the second quarter, effectively reversing a fragile recovery. This downturn is attributed to the persistent effects of inflation and the impact of interest rate hikes. Specifically, prices for office and retail buildings fell by 1% when compared to the same period in the previous year. In contrast, residential property prices in Germany continued their upward trend, although the pace of this growth has slowed. The reversal in the commercial sector indicates ongoing economic pressures affecting investment and valuation in this market segment.