Explaining Regional Disparities in Housing Prices across German Districts

Lars Brausewetter, Stephan Thomsen and Johannes Trunzer ()
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Johannes Trunzer: Leibniz University of Hannover

No 15199, IZA Discussion Papers from Institute of Labor Economics (IZA)

Abstract: Over the last decade, German housing prices have increased unprecedentedly. Drawing on quality-adjusted housing price data at the district level, we document large and increasing regional disparities: growth rates were higher in 1) the largest seven cities, 2) districts located in the south, and 3) districts with higher initial price levels. Indications of price bubbles are concentrated in the largest cities and in the purchasing market. Prices seem to be driven by the demand side: increasing population density, higher shares of academically educated employees and increasing purchasing power explain our findings, while supply remained relatively constrained in the short term.

Keywords: Germany; housing market; rental prices; regional disparities (search for similar items in EconPapers)
JEL-codes: R23 R31 (search for similar items in EconPapers)
Pages: 51 pages
Date: 2022-03
New Economics Papers: this item is included in nep-ure
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Citations: View citations in EconPapers (1)

Published - revised version published as 'Regional Supply and Demand Fundamentals in the German Housing Price Boom' in: German Economic Review , 2024, 25 (1), 1-36.

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Working Paper: Explaining regional disparities in housing prices across German districts (2022)
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