At the start of the year the mood in Germany’s real‑estate sector has worsened again. According to a Friday issue of the “Handelsblatt”, this is shown in the latest real‑estate sentiment index produced by the Institute for German Economic Research (IW) on behalf of the industry association ZIA.
The index slipped by 1.0 point in the first quarter. ZIA president Iris Schöberl told the newspaper that the already shaky foundation of the sector’s recovery is being held back once more by geopolitical crises and rising energy prices. She warned that without decisive structural reforms, the housing market could deteriorate sharply, especially in the already highly strained metropolitan regions.
Since the summer of 2025 the sentiment indicator has fallen by almost ten points. In early 2026 the rating of the current business situation eased slightly to 14.5 points, while expectations dropped more noticeably to 16.4 points.
Developers are feeling the pressure most acutely. The residential market’s present conditions edged up modestly, but firms’ expectations have fallen. The only sector showing improvement is the office market, where both current conditions and expectations have upgraded.