1. Home
  2. Studies
  3. A Hedonic Rental Price Index for Retail Properties in Germany: Methodology and First Results
Christian Oberst / Michael Voigtländer IW-Trends No. 4 17. December 2021 A Hedonic Rental Price Index for Retail Properties in Germany: Methodology and First Results

Despite their importance for users, investors and urban development, there is no appropriate monitoring of rent prices for retail properties in Germany. Comparing average rents alone is of limited benefit as the composition of location and quality properties of observed retail objects could differ significantly.

Download PDF
Methodology and First Results
Christian Oberst / Michael Voigtländer IW-Trends No. 4 17. December 2021

A Hedonic Rental Price Index for Retail Properties in Germany: Methodology and First Results

German Economic Institute (IW) German Economic Institute (IW)

Despite their importance for users, investors and urban development, there is no appropriate monitoring of rent prices for retail properties in Germany. Comparing average rents alone is of limited benefit as the composition of location and quality properties of observed retail objects could differ significantly.

Therefore, a hedonic rental price index for retail properties in Germany is estimated using a database of rental offers for retail properties. This hedonic price analysis explains the asking rents with a combination of characteristics such as location, size, quality, and timing of the offer. This quality adjusted (hedonic) rental price development is estimated for Germany as a whole, for different regional categories and 30 selected major cities. This analysis shows that rents for retail properties were rising dynamically prior to the outbreak of the Covid19 pandemic, especially in the seven largest cities. After a substantial decline in the total number of offers for retail rent, which is weaker in the seven largest cities and an increase in the period they were offered on the market, there are currently signs of a turning point for rental price development for retail properties. After continuing to rise in 2020, in 2021 quality-adjusted retail rents in Germany have stagnated and in the top seven locations even declined, which however we need to put this into perspective of substantial rent increases for retail properties in previous years in the top seven locations.

Content element with id 10360
Download PDF
Methodology and First Results
Christian Oberst / Michael Voigtländer IW-Trends No. 4 17. December 2021

A Hedonic Rental Price Index for Retail Properties in Germany: Methodology and First Results

German Economic Institute (IW) German Economic Institute (IW)

More on the topic

Read the article
Financialization in 13 cities – an international comparative report
Christine Whitehead / Kath Scanlon / Michael Voigtländer / Jacob Karlsson / Fanny Blanc / Martina Rotolo Expertise 3. July 2023

Financialization in 13 cities – an international comparative report

Over the last 20 years, financialization of the housing market has become a topic of increasing public and political concern, especially in high-demand cities. It has also become an important element in academic discussion.

IW

Read the article
Michael Voigtländer / Jonas Zdrzalek IW-Trends No. 1 14. April 2022

An Analysis of the Current Risk Levels in Residential Real Estate Financing in Germany

The German Federal Financial Supervisory Authority (BaFin) is keeping a watchful eye on the granting of housing mortgages and from 2023 on will require lending banks to increase their equity capital to cover potential risks.

IW

More about this topic

Content element with id 8880 Content element with id 9713