Germany updates: Rents soar in major cities despite controls

• An analysis by Germany's Housing Ministry has shown a huge increase in rents in major cities despite rules aiming to restrict rises
• Germany's industrial sector is flagging as China's strengthens, economists say

Here is a roundup of developments in Germany on Wednesday, June 18.

06/18/2025June 18, 2025

Rent cap fails to stop prices soaring in major German cities, data shows

Rental tenants in large German cities are being forced to pay ever more for places to live, according to an analysis by the Housing Ministry.

Advertised rents in the 14 largest independent cities have almost doubled on average over the past 10 years, figures from the Federal Institute for Research on Building, Urban Affairs and Spatial Development (BBSR) show.

The data provided in response to a parliamentary request.

Berlin has seen the greatest rise in new rental prices at 107%, followed by Leipzig (67.7%) and Bremen (57%). 

Dresden saw the smallest increase at 28.4%.

Rents in the southern city of Munich remained highest overall, with monthly rental prices reaching nearly €22 ($25.30) per square meter, the analysis showed. That was followed by Berlin at €18 per square meter, and Frankfurt at around €16 per square meter. 

Germany has laws in place to limit rents in regions with tight housing markets. In such regions, it is generally not allowed for landlords to demand rents for new leases that exceed the local comparative rent by more than 10%. Some exceptions are made, for furnished apartments, for example.

However, the lessors are not subject to government supervision, meaning tenants must reported suspected violations of the rules themselves.

06/18/2025June 18, 2025

Chinese industry gaining momentum as Germany lags

Chinese companies are beginning to catch up or even surpass German industry in sectors where the latter has traditionally led world markets, economists and experts say.

German exports fell by 1.7% last year to approximately €1.65 trillion ($1.9 trillion), according to Germany's Federal Statistical Office. 

At the same time, Chinese exports rose by 7.1% to over 25.4 trillion yuan (€3.04 billion; $3.5 billion), according to figures from Beijing.

"Chinese competitors have continued to catch up and are increasingly active in product areas and industrial segments where German industry has traditionally been very strong," economist Philipp Böing told Germany's DPA news agency.

He said Chinese companies had "in some cases already surpassed the technological capabilities of German competitors," citing fields such as digitalization and generative artificial intelligence.

Jens Burchardt, an industry expert and partner at the international consultancy BCG, told DPA that high energy costs were the main reason Germany was losing its competitiveness in energy-intensive industries such as basic chemical and the automotive sector.

"German manufacturers will only be able to maintain their current role if they play as significant a role in electric drives as they have traditionally done with combustion engines," he said. 
 

06/18/2025June 18, 2025

Welcome to our coverage

Timothy Jones | Zac Crellin

Guten Tag! Welcome to DW's coverage of news stories and developments in Germany on Wednesday, June 18.

Among other things, we will look at the rent situation in Germany, where figures presented by the government has shown it is becoming ever more expensive to be a tenant in major German cities despite official rules aimed at keeping rents down.

And German industry is facing a growing threat from Chinese rivals, even in sectors where "Made in Germany" has traditionally been a byword for quality.

You can read here about these topics and more from Europe's biggest economy.