German Housing Market Put To The Test Again

Germany's housing market has shown surprising resilience in early 2026, though rising mortgage costs and affordability challenges point to a testing period ahead. Structural supply shortages remain the key factor supporting current valuations.

Key Takeaways

• 1.The German housing market has shown unexpected resilience to geopolitical tensions and rising rates in Q1 2026.
• 2.Mortgage lending data reveals underlying fragility, with demand sensitive to rising financing costs.
• 3.Structural undersupply provides a floor for the market, counteracting affordability pressures.

Table of Contents

• The German housing market has withstood the geopolitical storm, so far
• House prices compared to recent peak and trough levels
• Challenging outlook, with structural support in place

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