Berlin suburbanisation. An “urban” myth?
As the Covid-19 pandemic has progressed, anecdotal evidence suggests there has been a shift in demand from city centre to suburban living. But is this really the case? Research commissioned by QSix shows that demand for home ownership has shifted further towards the city centre and that a larger number of city dwellers now prefer to remain in the city compared to pre-pandemic levels, while those living in the suburbs prefer to remain in the suburbs.
About the QSix survey
QSix, in partnership with Savanta, surveyed homeowners and private renters aged from 18 to 55 years in Berlin to find out how attitudes towards housing have changed since the start of the pandemic in early 2020.
Although short-term suburbanisation has been widely reported on a pan-European basis since the onset of the pandemic, with large numbers of individuals and families allegedly moving out of urban centres to the suburbs in search for improved living conditions, the survey data actually shows the sentiment of those Berlin city-dwelling respondents (irrespective of housing tenure) has shifted in favour of the city centre, with demand for urban living increasing by 3.5%. By contrast, suburban living demand actually decreased by 8.1% over the same period.
This preference would appear to be supported by rental market data from Berlin, which saw vacancies remain at all-time low levels and rents continue to rise through 2020 and H1 2021 despite social contact and travel restrictions. This is in contrast to other capital cities, such as London, which saw a proportion of the younger population return to their country or place of origin, creating an increase in vacancies and a sharp fall in City centre rents.
Berlin homeowner and renter intentions
| Tenure | Looking to move | Not looking to move | Purchase a new main home | Move into a new rental |
| Homeowner | 64.0% | 36.0% | 49.2% | 14.8% |
| City centre | 70.3% | 29.7% | 54.7% | 15.6% |
| Suburban | 52.3% | 47.6% | 39.0% | 13.3% |
| Private rent | 62.5% | 37.5% | 29.7% | 32.8% |
| City centre | 63.3% | 36.7% | 30.1% | 33.2% |
| Suburban | 60.4% | 39.6% | 28.5% | 31.9% |
| Average | 63.2% | 36.8% | 39.1% | 24.1% |
Homeowners
City centre dwellers want to move, suburban dwellers more settled.
The survey reveals that a high proportion of Berlin city centre homeowners are looking to move, with 70% reporting a desire to move home within the next 12 months. However, the research also showed that the number of city centre dwellers looking to move to the suburbs has declined since the onset of the pandemic. Prior to the pandemic, 27% of Berlin city centre homeowners wished to move to the suburbs. This fell to 17% following the onset of the pandemic. By contrast, the proportion of Berlin homeowners wanting to remain in the city centre actually increased by 8% to 62%.
Suburban homeowners, on the other hand, seem more settled with only 52% of respondents wishing to move post pandemic and 56% wishing to remain in the suburbs.
Renters
Berlin renters keen to buy.
Berlin renters have a different mindset. Not only are a lower proportion of private renters looking to move within the next 12 months but of those, 66% are looking to move to a new rental in the city. There is also an increasing desire for homeownership with almost half of those looking to move in the near-term seeking to transition from renting to ownership within the city centre.
Suburban renters are more inclined to stay where they are and, although 60% said they might be looking to move within the next 12 months, there was broadly a 50:50 split between those wishing to remain in rented accommodation or switch to home ownership.
Despite the survey results, QSix believes that the investment case for surburban Berlin remains strong since it is important to point out that the data only reflects the preferences of the existing population. Suburban Berlin living is expected to benefit from significant job creation stemming from infrastructure investments such as Tesla’s giga factory and the growth in airport traffic at Berlin’s new airport. These factors support our view that demand for suburban living will grow, but this demand won’t primarily be driven by a migration from the City.
