ProspektGuru Releases Report on Germany's Housing Market

By: Newsfile

Munich Remains Germany's Most Expensive Property Market, Pirmasens the Most Affordable

Berlin, Germany--(Newsfile Corp. - August 25, 2025) - A new nationwide analysis by ProspektGuru has shed light on the deepening divide in Germany's housing market, confirming that Munich continues to be the country's most expensive real estate city, while smaller cities like Pirmasens and Salzgitter offer the most affordable options for homebuyers.

The study compared average real estate purchase prices with annual household incomes across selected German cities, revealing stark regional contrasts in affordability.

According to the findings, the average home in Munich costs €663,000, representing an affordability ratio of 11.6 times the average annual income (€56,976). Hamburg follows in second place, where residents face home prices around €474,000 — approximately 9.4 times the local average income (€50,423). Frankfurt and Main ranks third, with prices averaging €454,000, or eight times the local annual income (€56,467).

At the other end of the spectrum, Pirmasens emerged as the most affordable housing market, where a typical home costs just €113,940, roughly 2.76 times the average annual income (€41,292). Salzgitter, with a ratio of 2.68 (average house price €144,360; income €53,844), was identified as the most balanced market in the country.

"These numbers highlight the stark reality of the German housing market," said Hans Müller, spokesperson for ProspektGuru. "While metropolitan areas like Munich and Hamburg remain highly desirable, the cost burden on households is reaching unsustainable levels. By contrast, many mid-sized and smaller cities offer far more favorable ratios, which could become increasingly attractive for young families and first-time buyers."

The study also revealed the Top 10 most expensive and Top 10 most affordable cities based on the purchase price-to-income ratio. Cities such as Potsdam, Freiburg, Heidelberg, Cologne, Berlin, Regensburg, and Stuttgart also ranked among the least affordable, while affordable alternatives were largely concentrated in industrial or mid-sized cities in western and eastern Germany.

Beyond rankings, ProspektGuru's analysis provides an important reminder for buyers to look beyond absolute home prices and evaluate housing costs in relation to local incomes. The company emphasizes that purchase affordability should be measured not only by the sticker price of a property but also by the financial reality of households in each region.

"Understanding the price-to-income ratio helps people make better financial decisions and avoid overextending themselves," added Müller. "For investors, it also provides a clear signal of where demand may shift in the future as affordability pressures grow."

The report comes at a time when policymakers are grappling with issues of housing affordability and supply shortages in major cities. ProspektGuru's findings underline that while Germany's housing crisis is most acute in urban hubs, viable alternatives exist in less obvious locations, offering both affordability and quality of life.

About ProspektGuru

ProspektGuru.de is a leading consumer information platform that provides insights, guides, and analyses on everyday financial and lifestyle decisions. From real estate and housing market trends to consumer savings and shopping deals, ProspektGuru helps individuals and families make smarter choices in an increasingly complex economic environment.

Media Contact:
Company: ProspektGuru

Contact Person: Hans Müller

Email: hans@prospektguru.de

Berlin, Germany

https://www.prospektguru.de/

To view the source version of this press release, please visit https://www.newsfilecorp.com/release/263715

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