Where in Germany are rent burdens highest for workers?

The monthly frigid rent has now reached a level where it makes up more than a third of the typical salary in several communities throughout the seven main German cities. Renting a property has become an increasingly painful expense for inhabitants in Germany’s busiest urban hubs.

To determine how much of their salary inhabitants are spending on rent, a recent study by Berlin-based data provider 21st Real Estate examined the relationship between income and rent in Germany’s seven largest cities.

Berlin stands out as the city

• • Berlin has the highest net income-to-rent discrepancy in Germany.
  • The average cost ratio for the entire city is a striking 32%.
  • High cold rents and relatively low average salaries characterize the situation in Berlin.
  • Munich has higher average rent rates compared to Berlin.
  • Berlin’s rental cost ratio of 32% is similar to Munich’s.

Rental cost ratios of Munich

• • Munich’s income-rent gap is due to residents earning an average of €57,259 annually.
  • These high earners are concentrated in expensive micro-locations with rental cost ratios exceeding 35%.
  • In contrast, Berlin’s equivalent neighbourhoods have a lower average income of €40,255.

Stuttgart ranks third

• • Stuttgart has a rental cost ratio of 29%.
  • Frankfurt follows closely with a ratio of 27%.
  • Cologne is the most cost-effective metropolitan area with a ratio of 26%.
  • Düsseldorf and Hamburg both have ratios of 25%.
  • Despite these figures, many city neighbourhoods still face rental cost ratios exceeding 30%.
  • In areas like Mitte and Nord districts north of the Elbe in Hamburg, rent consumes over 37.5% of the average salary in nearly every street.

The rental burden

• • Rent strain is notably lower in suburbs around major cities.
  • For example, Duisburg, near Düsseldorf, has a reasonable rental cost ratio of 13.4%.
  • The research is based on a review of 271,000 online flat listings and income calculations that consider micro-locations within streets and neighbourhoods.
  • Income statistics were provided by the market research firm GfK.
  • It’s important to note that the rental offers analyzed don’t necessarily represent finalized lease agreements.
  • Landlords rarely offer reductions due to the high demand for property in major urban areas.