How the city’s gentrification impacts Berlin property

How the city’s gentrification impacts Berlin property


The German capital has seen a boom in visitors over the last few years – and for a good reason. Berlin is undergoing a renaissance of its own kind. Numerous reconstruction projects as well as a burgeoning artistic scene have helped attract young people wishing to study or work there.

The first step towards an area’s gentrification is always when a somewhat mixed or rundown area starts attracting young people and artists seeking places where rents are low. This young and hip crowd then populates the area’s cafes, bars, restaurants and clubs and might open some new ones. This makes the area up-and-coming and will start attracting first-time buyers, investors and further businesses.

The poster child for this kind of gentrification in Berlin is Prenzlauer Berg, a former East Berlin working class district – and now one of the hippest and most elegant residential areas in town. The flipside is that, after having been invaded by investors and young families, the very artists and hip crowds who were at the origin of the area’s gentrification now feel forced to move on – rents are too high, and some old establishments (e.g. some old funky nightclubs) are forced to close down due to noise issues. Klub der Republik was one of Prenzlauer Berg’s major and more recent casualties. Those lots of land will generally be replaced by modern residential developments selling at high prices (5000 to 7000 Euros per square metre, which is top end for the city), a trend which has contributed to rising Berlin property prices.

Still, Prenzlauer Berg remains a very attractive option for tourists. It is close to the city centre (5 minutes by subway from Alexanderplatz, 20-25 minutes walking distance), it has numerous bars, restaurants, cafes, terraces and shops and elegant, leafy streets. There are not many hotels there, so the best way to stay in the area might be to rent an apartment.

If you want, however, explore where many youngsters are moving nowadays, have a look at Neukoelln. During my last stays in Berlin, I have come across more and more people living in or moving to that area. Neukoelln had been written off by many until about four years ago, owing to its above average crime and unemployment rates. The area does, however, have a beautiful housing stock, cobblestone streets, some nice parks (Koernerpark in particular) and a culturally very mixed population. The fact that other area of Berlin have become increasingly unaffordable for many young artists and students has led many to seek cheaper housing in Neukoelln. In addition, the area got a boost from the closure of nearby Tempelhof airport in 2008, which has now been turned into a large recreation ground – and Berliners recently rejected its partial redevelopment in a popular vote.

In the last couple of years,  betting on Neukoelln’s renaissance has already paid off nicely for Berlin property investors: rents and house prices have been climbing at double digit rates. Still, staying in Neukoelln will offer you an enjoyable and somewhat different experience from the city centre, as the area’s cultural diversity and its up-and-coming flair will provide you with a wonderful insight into day-to-day life in this fascinating city.

Nowadays, the West of Berlin is again attracting more attention, as many areas in the East have significantly caught up or even overtaken the West when it comes to redevelopment, investment and gentrification.


  1. […] Berlin’s gentrification is not welcomed by everybody. Especially for young people – artists, students, actually, many of those who “made” Berlin trendy fifteen or twenty years ago – Berlin is losing its cachet, Berlin apartments are becoming more and more scarce and increasingly expensive, and the young hipsters are being replaced by young professional couples with small children. […]