Germany’s population is set to decline in the next few decades. Rural counties and cities in the Ruhr valley and eastern Germany are already shrinking, while metropolises such as Munich and Hamburg continue to experience strong growth. Real estate investors are therefore largely concentrating on cities that are expected to continue growing in the medium term. However, using an empirical model based on data for 127 cities, it can be shown that today’s prices already reflect expectations of future real estate demand. This applies both to the price of residential property and the assumed growth in rents. It can thus be concluded that, as far as purely demographic factors are concerned, real estate prices in German cities will neither dramatically decline nor soar.
Philipp Deschermeier IW-Trends No. 3 14. September 2024
IW Population Forecast 2024
The demographic transition poses major challenges for policymakers, business and society as a whole. Policymakers seeking solutions to these challenges mainly base their decisions on the quantitative data of population forecasts.
Possible Developments in the Supply of Skilled Workers up to the Year 2040
The German labor market is on the verge of a fundamental upheaval. While the number of people in the labor force has risen steadily in recent decades, it is likely to drop significantly as soon as the baby boomers retire.
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German Economic Institute (IW) 
