Erfurt Much has been puzzled and predicted, now an analysis of actual property purchases and sales shows: The prices for home ownership have fallen noticeably in the corona crisis. Compared to February, condominiums were sold 7.5 percent cheaper in March and April. Prices across Germany averaged 2776 euros per square meter. In February it was 3002 euros. For one- and two-family houses, prices fell by 1.8 percent from 2,200 to 2,160 euros per square meter, an analysis by On-Geo shows based on 20,000 transactions since March.

The results of the previously unpublished study are available to the Handelsblatt. “The corona pandemic has caused a short-term shock reaction to residential property prices,” said Sanjo Nitschke, head of analysis at On-Geo.

On-Geo is a data service provider for the real estate market. According to their own information, 85 percent of all savings banks and banks in Germany use the Munich company’s products for property valuation. Every year it determines the values ​​for more than 1.5 million properties.

The study, which is based on real purchase prices, is a counterpoint to the numerous analyzes based on supply data since the beginning of the corona crisis. Various studies have so far come to the conclusion that, in times of crisis, significantly fewer properties were offered, but prices remained stable. For example, an analysis by the F + B analysis company recently showed that the prices of the apartments on offer rose by as much as six percent between the beginning of March and the end of May.

The on-geo analysis also shows that the market recovered with the gradual easing after the strict contact restrictions. Condominiums are trading almost at the pre-crisis level, and one- and two-family houses are even trading above. “It cannot yet be said seriously what long-term effects there will be. The ongoing value monitoring will show that, ”says Nitschke.

The trend was clear until shortly before the crisis: Home ownership in Germany at the end of the first quarter of 2020 was around nine percent more expensive than in the previous year. Unfortunately, the analysis of On-Geo does not yet reveal how the transaction prices developed in the second quarter compared to the previous year and how the trend is in individual regions or even cities. There is only offer data for the time being.

On this basis, the real estate service provider JLL published an analysis of the eight largest German cities just a few days ago – Berlin, Munich, Hamburg, Cologne, Frankfurt, Dusseldorf, Leipzig, Stuttgart. Accordingly, prices for condominiums rose by 9.3 percent in the first half of the year, after 6.7 percent in the previous year. At 5.0 percent, rents actually rose twice as much as in the previous year.

In the eight largest cities, there is still a large discrepancy between supply and demand, explains Sebastian Grimm, residential property expert from JLL. JLL sees the biggest gap between future needs and current completions in Cologne, Stuttgart and Leipzig. Hamburg and Dusseldorf, on the other hand, have “the best relationships with regard to these two factors”.

However, studies of offer data have at least one catch: they do not say anything about the purchase price actually paid. The fact that some analyzes are based on largely stable prices should not be over-interpreted, as the housing market expert Harald Simons from Empirica warned. The fact that average prices are stable could be due to the fact that fewer apartments come onto the market in the low-priced segment, but more in the high-priced segment. The statistics could also be distorted because fewer apartments were advertised than in the comparable period.

More: Trend quarter 2020 – Where rents and purchase prices rise the most