Historic year for real estate Prices for owner-occupied flats in Bonn fell in 2023

Bonn · On Wednesday, the Property Expert Committee presented the latest property market report. According to the findings, 2023 will be a historic year for property in Bonn. After a long period of growth, prices for owner-occupied flats will have fallen for the first time.

 Residential property prices in Bonn have fallen after a long period of increases.

Residential property prices in Bonn have fallen after a long period of increases.

Foto: Meike Böschemeyer

Prices for building land in Bonn have risen for years due to high demand. The 2024 property market report for the federal city now shows a reversal of the situation for the first time. "It is a historic year for the property market," says Annette Lombard, Chairwoman of the Bonn Expert Committee for Property Values. Together with the committee's managing director, Christof Linnemann, she on Wednesday gave an insight into market developments in Bonn over the past year.

Fewer purchases of land and flats in Bonn

It is noticeable that in all sub-markets - undeveloped land, developed land, flats and condominiums - the number of purchases fell once again after 2022. Then, there was a decline of 19 per cent, with the number of purchases falling from 2,992 in 2021 to 2,431 in 2022. They have now fallen again by twelve per cent to 2,135. The sharpest fall, around 20 percent, was in the number of vacant plots. Total financial turnover will fall by around 15 per cent, from €1.3 billion to €1.1 billion, compared with 32 per cent in the previous year's 2023 report.

Experts see fundamental economic developments as the cause of falling prices in many areas. Rising interest rates, exploding construction costs and greater independence from people’s place of residence due to remote working regulations are just some of the factors. Bonn is no exception to the general trend on the property market. In larger cities such as Munich, Berlin or Hamburg, where the market was previously much more inflated, price corrections are even more pronounced, says Linnemann.

In comparison to larger cities such as Cologne, the decline in Bonn was relatively moderate. Large and reliable employers such as the UN, the university, Telekom, DHL or the local federal ministries also ensured a high level of affordability and relative stability thanks to high salaries. According to the experts, price developments have led to a shift from higher-priced to lower-priced regions. For example, from Cologne to Bonn or from Bonn to the surrounding municipalities.

Most expensive standard properties in Bad Godesberg

Several examples in the report illustrate how popular Bonn is and how expensive property in the city is, despite falling prices in some cases. For example, the standard land value for a 400 square metre single-family house plot in Bonn's Südstadt district is 1360 euros per square metre, while the corresponding area for a 500 square metre standard plot in Duisdorf's Oberdorf district is 880 euros per square metre. The highest benchmark for individual residential construction is still to be found in Nachtigallenstraße in the Bad Godesberg district. Here the price for a standard plot of 700 square metres is 1,500 euros per square metre.

While the value of ready-to-build plots for detached and semi-detached houses remained broadly stable due to high demand and declining supply, standard land values in the more expensive locations (over 1,000 euros per square metre) fell by five per cent. According to the report, standard land values for residential or mixed-use land have fallen by ten per cent across the city. The standard land values in business locations in the city centres of Bonn and Bad Godesberg also fell by 15 per cent.

Buying an apartment in Bonn: 11,800 euros per square metre

The sharpest decline in submarkets in 2022 was in the area of developed properties with residential, commercial or mixed use (40 per cent). In 2023 it was significantly lower, at six per cent. While sales of detached and semi-detached houses, apartment blocks and mixed-use properties changed only slightly, sales of office, administrative and commercial properties fell again significantly, by around 25 per cent.

For the first time in many years, prices for second-hand owner-occupied flats in Bonn started to fall. Average prices fell by around nine per cent year on year. Prices for new-build flats remained almost stable, falling by just 1.2 per cent. The highest average purchase prices were recorded in the Musikerviertel and Südstadt districts of Bonn. As in the previous year, the price per square metre for the most expensive flat in Bonn was around 11,800 euros.

Original text: Jonas Dirker

Translation: Jean Lennox

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