Next slump on the Munich real estate market: The number of condominiums (as well as offices, shops or garages) sold fell to 6,910 in 2023. In the previous year, the city of Munich’s expert committee, to which all purchase contracts must be reported, registered 7,770 sales. In 2021 – before the real estate crisis broke out – 10,960 properties in the “housing and partial ownership” category had changed hands.
The municipal department, where the expert committee is located, reported these figures on Monday afternoon at the SZ’s request. In a two-year comparison, this represents a decline of 37 percent. Already in the summer, committee chairman Albert Fittkau, when looking at the first five months of 2023, spoke of sales figures being as low as they were last seen in the 1970s.
On Monday morning, municipal representative Kristina Frank (CSU) gave the first new figures on the development of the market during an online event organized by the Central Real Estate Committee (ZIA) industry association. Accordingly, the number of all purchase contracts in 2023 has fallen by another twelve percent in 2022 compared to what Frank described as the “not a glorious previous year” and the monetary turnover has even fallen by 37 percent to 7.5 billion euros. A decline in the price of residential real estate has also been recorded, said Frank. The city will only present the exact figures in the summer. However, the real estate association IVD recently presented its own evaluations, according to which the prices for new apartments fell from 11,500 to 9,800 euros per square meter within two years.
However, the expert committee is currently registering a revival in the market. In January and February 2024, the number of purchase contracts increased by 38 percent compared to the (also bad) period of the previous year, explained Frank. In the residential category, the city registered 1,180 sales in the first two months of this year, generating a turnover of 550 million euros. Frank called these numbers “already a decent house number.” The municipal representative also derives a good omen for construction activity in the city from these figures on real estate sales: “All construction sites that stand still are not good for us in Munich. All projects that don’t even start are doing us even worse.”
Because the situation on the real estate market is so bad, more and more owners want to sell their properties to the city. “The municipal department currently has over 100 offers for acquisition,” said Frank in her presentation. A year ago there were around 60, six months ago 80. However, due to capacity reasons, the municipal department only takes a closer look at some of them. According to Frank, there must be at least 30 apartments. Eleven properties with a total of 837 residential units are currently being examined for purchase.
She did not give any examples, but last week the city responded to a request from the Die Linke/Die party faction, the municipal department and the municipal company Münchner Wohnen were examining the purchase of a plant from the Vonovia group, details were not given. According to reports, there will be a total of around 100 apartments.