Top Cities and Neighbourhoods

Which Cities will Keep Growing after the Crisis?

31.

December 2020

The coronavirus crisis has changed the world in many ways. International migration flows, for example, have slowed down significantly in 2020, and this in turn is likely to have drastically slowed the demographic growth in Germany this year. But chances are that the population total will principally keep going up in the years ahead – especially in certain regions of Germany, as the GEWOS Institute for Urban, Regional and Housing Research determined in a recent analysis. (source: www.haufe.de)

Among the large metropolises, the researchers predicted the fastest growth for Berlin. The population of the federal capital is expected to grow by 6.6 percent between now and 2035. Frankfurt am Main, too, can expect a brisk growth rate of 6.2 percent. Other cities for whom strong demographic growth is predicted include Cologne (4.8 percent) and Hamburg (4.7 percent).

The institute generally expects Germany’s population to keep growing over the next 15 years, although the growth will no longer proceed with the same high dynamic it showed during the past decade. A growth rate of 0.7 percent may bring the population total up to 83.7 million residents.

Strong Economic Growth in Major East German Cities

Another recent study on the time after the coronavirus crisis was published by the Prognos research institute. However, the Prognos analysis focuses primarily on the question which of Germany’s regions will see particularly brisk economic growth between now and 2030. (source: www.handelsblatt.com)

The Prognos experts also focus on Berlin, among other cities, as growth engines. The gross value added of Germany’s first city is to rise by 9 to 11 percent between now and 2030. For the greater Berlin metro area, the forecast is even more optimistic, predicting economic growth rates of 11 to 28 percent for the suburban districts of Potsdam-Mittelmark, Dahme-Spreewald and Oder-Spree. More or less the same strong growth rates are projected for other East German cities, such as Leipzig, Dresden, Halle (Saale), Magdeburg and Cottbus.

Fast-Growth Metro Regions

According to the forecast, Berlin is not the only metropolis that is likely to see fast growth. Hamburg, Munich, Frankfurt am Main, Cologne and Stuttgart are all predicted to increase their economic strength at rates of 11 to 28 percent. Just like in the case of Berlin, the regions surrounding these cities stand to benefit hugely from their attractive pull. Indeed, all of the metro regions are expected to see above-average growth before 2030.

Data such as these are extremely interesting for real estate investors. Because the real estate markets of cities and regions where robust demographic growth prospects coincide with an economic outlook of above-average growth are likely to count among the winners in their own right.

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