BERLIN, Jan. 20 (Xinhua) -- The number of newly contracted rents in Germany's 50 most expensive cities decreased by 0.3 percent in the fourth quarter of 2019 compared to the previous year, according to the housing index of the private research and consulting company F+B published on Monday.
The housing index, which measures rent and price developments on the German real estate market, showed that rents had fallen in 11 of the country's 50 most expensive cities. The index is based on data of more than 30 million properties in Germany.
"Overall, the growth momentum measured by our index has weakened over the course of 2019, although the sub-segments have developed significantly differently," said F+B Managing Director Bernd Leutner.
While rents in Germany decreased, real estate prices continued to climb. In the fourth quarter of 2019, condominium prices rose by 5.4 percent and single-family home prices increased by 3.8 percent.
Although the average price per square meter for rental apartments in Munich decreased by 0.6 percent, Bavaria's state capital remained Germany's most expensive city with an average price of 16.40 euros (18.18 U.S. dollars) per square meter in new contracts.
In the capital Berlin, rents have fallen by 1.2 percent. Over the last ten years, rents in Berlin had almost doubled. To counter rising rents, Berlin's senate has decided to freeze rents for the next five years. The rent cap, which is unique in Germany, is set to apply to most properties built before 2014.
"In addition to the rent brake, the effects of the additional cap on rent increases for the state-owned housing companies are presumably becoming apparent," Leutner said.
Despite the overall downward trend, rents continued to increase in other large German cities like Duesseldorf, Cologne and Frankfurt. In Duesseldorf, the increase was 1.6 percent.
Smaller German municipalities registered the steepest increases. In Kempten, located in the German Alpine region of Allgau, new rents shot up by more than 20 percent. According to the F+B, the increases were also the steepest in municipalities in Baden-Wuerttemberg and Bavaria.
"Apparently, a strong economic situation combined with a high quality of life and high recreational value is the guarantee for dynamic price formation," Leutner explained.
