Families in half of Germany’s cities must earn at least 5.000 euros before tax to be able to afford their own flat or house. In Munich and Hamburg, the market is even more unaffordable for an average family of three.

Housing increasingly unaffordable for families in Germany

According to a recent internal assessment by property portal Immowelt, families in German cities must now earn a minimum of 5.000 euros per month before tax deductions in order to afford a property. Immowelt calculates that only a monthly family income of over 5.000 euros is enough to be able to afford a 90 square metre house or flat, the size the platform considers adequate for a family of three.

In their analysis, Immowelt calculated the monthly expenses of a family of three on an average gross income of 1.500 euros per adult. The platform assessed how their income would fare when taking out a mortgage for a two bedroom, first floor house built in the 1990s at an interest rate of 4,2 percent. The platform’s assessment found that a collective income of 5.000 euros per month was required in 80 of Germany’s cities. 

Immowelt cited the rising cost of construction as a cause for increasingly unaffordable property prices in German cities, which has been particularly acute since the beginning of 2022. Houses and flats that may have been affordable for families to buy in 2021 are now no longer an option for those on average incomes.

Munich and Hamburg families must earn 10.000 euros before tax

As many might expect, families in some of Germany’s more expensive cities need to dig deeper when looking to buy a house. In Munich, the country’s most expensive city, three-person families have to fork out 823.590 euros to buy a 90 square metre property. With the current standard interest rate this would mean a monthly payment of 4.255 euros. Paid out by a family of three with one child, with one adult working full-time hours and the other working part-time, these payments would snatch a staggering 88 percent of an average family’s monthly income.

In Hamburg there was minimal relief from skyrocketing prices, with the same properties costing around 588.510 euros, which would snap up 71 percent of the average family income. At least 10.135 euros per month is required to comfortably cover the cost of buying a house in the city state. In Cologne, the necessary amount decreased to a monthly income of 8.203 euros for a family of three, and in Berlin, down a little further - but still unaffordable - to 7.942 euros per month.

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