Why Munich is the most expensive place in Germany to buy a home

The southern German city of Munich, capital of the state of Bavaria, does well in many “liveability” rankings: in 2015 Monocle magazine placed it ninth on its list of the world’s most liveable cities, ahead of Copenhagen and Zurich, and one spot behind Helsinki. Researchers suggested that Munich’s motto could be: “Work hard and play outside.”

The ski slopes at Garmisch-Partenkirchen are about 90km from the city and the lakes of southern Bavaria such as Starnberger See — 25km from downtown Munich and easily reached via the city’s suburban train service — offer sailing and swimming.

The city of about 1.5m residents is popular with Germans casting around for a new place to live. This, coupled with a powerhouse local economy — the city is home to several major corporations including Siemens, Allianz and BMW — has made Munich the most expensive city in Germany to buy a home. According to the German Real Estate Association, apartments located in average residential areas in Munich (including units sold with long-term tenants) typically cost €3,600 per sq metre, up 10.5 per cent over the course of 2014. The same type of apartment would cost €2,100 per sq metre in Hamburg (also up 10.5 per cent in 2014) compared with €1,750 per sq metre in Berlin, up almost 13 per cent.

After the second world war, Munich was rebuilt in a traditional style. There are no high rises downtown, and the city takes pride in its baroque and rococo architecture. Unlike Berlin, there are few brutalist buildings and few hipsters — Bavarians can be spotted wearing lederhosen and dirndls with pride. There may be plenty of top-range cars on view, but Munich is not a place that feels very cutting edge.

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