NRW.Bank: Housing market remains tense in 2026 - North Rhine-Westphaliaâs housing crisis eases slightlyâbut rents keep rising
North Rhine-Westphaliaâs housing market shows signs of gradual improvement, though challenges remain. Building permits for single- and two-family homes have risen sharply, offering potential relief by 2026. Yet rents continue to climb, with new apartments costing significantly more than older ones.
In the first half of 2025, average rents in North Rhine-Westphalia reached âŹ9.84 per square metre for existing apartments. New builds were far pricier, at âŹ13.77 per square metre. Barrier-free and small units, particularly one-room flats, cost even moreâaround âŹ2 above the statewide average.
Regional differences remain stark. Cities along the Rhine and the MĂźnsterland area have the highest rents. Meanwhile, university towns may see slight easing in 2026, partly due to the 13-year school system reducing student demand. Construction activity is picking up, but progress is slow. It takes roughly two and a half years to complete a residential project. In 2024, over 6,000 apartments were added by converting attics and extending multi-family buildings. Despite this, the rental market will stay tight in 2026. Rents for newly rented apartments are forecast to rise by 3-4% next year. While more homes are being built, the pressure on affordability is unlikely to fade soon.
The increase in building permits suggests some future relief, particularly for single- and two-family homes. However, rents will keep climbing, and demand in major cities will stay high. Gradual improvements in construction may ease pressureâbut not before 2026.
