BERLIN — Berlin’s housing shortage has become one of the clearest signs of the affordability pressures facing major European cities, with advertised rents remaining at historically high levels while the German capital calculates that it needs another 211,000 homes by 2040.
The pressure is particularly visible for people searching for accommodation now. Berlin’s latest housing market figures show that the median advertised rent reached €15.78 per square metre in 2025, compared with €9 per square metre in 2016. That represents an increase of about 75 per cent over the period.
For new-build apartments, the median advertised rent was considerably higher at €19.97 per square metre.
The figures describe asking rents for homes coming onto the market rather than what every Berlin household currently pays. Long-term tenants with older contracts can face substantially lower rents, making the gap between existing tenancies and the cost of finding a new home particularly significant.
The latest Berlin housing-market analysis also indicates that asking rents have stabilised at a very high level after several years of sharp increases. A 2026 housing market report from CBRE and Berlin Hyp put average asking rents at around €15.80 per square metre, while noting that rental supply remains limited.
Berlin calculates a need for 211,000 more homes
The scale of the problem extends beyond rents.
Berlin’s updated housing development planning identifies a requirement for approximately 211,000 additional homes between 2026 and 2040.
Of that total, around 138,000 homes are associated with existing housing-market pressure, while another 73,000 are linked to expected population growth.
The city has identified potential sites capable of accommodating approximately 213,000 homes. On paper, that is slightly more than the projected requirement.
But identifying land is not the same as delivering completed homes.
Berlin completed around 60,000 homes between 2022 and 2025, despite higher construction costs and more difficult financing conditions. The challenge is therefore increasingly about how quickly potential development sites can move through planning, financing and construction.
That distinction is important for cities across Europe. A large pipeline of potential housing does not automatically translate into homes available to households searching for accommodation.
New tenants face the greatest pressure
The difference between advertised rents and existing rents helps explain why housing pressure can be particularly severe for people who need to move.
Berlin’s local comparative rent — a measure used for existing tenancies — was reported at €7.21 per square metre, considerably below the median advertised rent.
That does not mean the average Berlin household pays €7.21 per square metre. Instead, the figures illustrate the different conditions facing established tenants and people entering the market.
Someone who has lived in a property for many years may therefore have a substantially different housing cost from someone trying to rent a comparable property today.
That gap can make moving within the city increasingly difficult, particularly for households whose income has not increased at the same pace as asking rents.
Tempelhofer Feld becomes part of the housing debate
The shortage has also brought renewed attention to Tempelhofer Feld, the large former airport site in central Berlin that has been used as public open space since the closure of the airport.
Whether housing should eventually be developed around parts of the site has become one of the most visible disagreements in Berlin’s housing debate.
Supporters of development argue that the capital needs additional homes and that centrally located land could contribute to easing the shortage.
Opponents have argued that Tempelhofer Feld is an important open space and that other sites should be developed or intensified before the former airport grounds are considered for housing.
The debate illustrates a problem increasingly faced by European cities: finding enough land for housing while protecting green space and existing urban environments.
Berlin has tried regulation as well as construction
Housing affordability in Berlin has also been shaped by attempts to regulate rents.
In 2020, Berlin introduced the Mietendeckel, or rent cap, which froze and limited rents across much of the private rental market.
Germany’s Federal Constitutional Court struck down the measure in 2021, ruling that Berlin did not have the legislative authority to introduce its own rent-control regime because federal law already regulated the area.
The episode remains relevant to the city’s housing debate because it demonstrated the limits of Berlin’s ability to independently reshape rental law.
It also highlights the tension between measures intended to protect existing tenants and the longer-term need to increase the supply of homes.
Berlin reflects a wider European housing problem
Berlin’s experience is not isolated.
Across the European Union, rents and house prices continued to rise during the first quarter of 2026. Eurostat reported that EU house prices increased by 5.1 per cent year on year, while rents rose by 3.0 per cent.
The European figures mask significant differences between individual countries, but the direction of the overall market shows why housing affordability remains a major issue across the bloc.
Berlin provides a particularly visible example because a large majority of households rent rather than own their homes. Reuters reported that about 85 per cent of Berlin households are renters, making changes in rents and the availability of rental properties particularly significant for the city’s population.
The city election taking place on September 20 has therefore brought housing supply, rents and the future use of urban land into sharp focus. Berlin’s official election authority confirms that the House of Representatives election is being held on September 20.
But the housing challenge will extend beyond the election.
Berlin’s own calculations point to the need for 211,000 additional homes by 2040, while households searching for a new rental property are already facing asking rents far above the levels reflected in many existing tenancies.
The central question for Berlin is therefore not simply whether more housing is needed. It is whether the city can turn identified development capacity into completed homes quickly enough to ease pressure on a rental market that remains expensive even after the pace of rent increases has begun to slow.
