Is Berlin still an affordable city?
Berlin is experiencing a period of increasing rents and depleting stock as the numbers of people moving to the city continues to increase. With prices still comparatively cheaper to rates you would find in the major cities of Madrid, Paris or London, Berliners tend to earn a lot less than their counterparts in these cities.
As Berlin continues to play catchup to the rest of the world, the current tightness on the rental market is just a symptom of that.
Following the fall of the Berlin wall, and the reunification of the city in 1990 more people have decided to return to the city. The problem with homing all these people is the quality of the buildings available. Some have structural problems which have existed for a long time, but these issues are unlikely to slow the city from transforming into a world-class city.
What many residents want to avoid is the development of ghettoes on the fringes of the city, where the poor are pushed outward and the centre of the city is only reserved for the very rich. This is often the case when you begin to attract large groups of foreign investors.
Berlin has recently been a popular market for investors in search of low entry levels. Although the rents are relatively cheap, the yields are still fairly favourable. As the older pieces of property begin to fill up, we will likely see more new-build property entering the market.