The effect of immigration on the German housing market

Arbeitspapier

This study provides evidence of the causal impact of immigration on German house prices, flat prices, and flat rents using an extensive dataset covering 382 administrative districts over the period 2004-2020. Employing a panel-data approach and a manually constructed shift-share instrument, we show that international migration has a significantly positive short-term effect on German flat prices and rents. House prices are not significantly affected. We estimate that an increase in international migration of 1% of the initial district population causes a hike in flat prices of up to 3% as well as a hike in flat rents of about 1%. The increase in flat prices is more than twice as high as this at the lower end of the market, whereas the flat rental market demonstrates a more linear response. We also discover that immigration's impact on flat prices and rents does not significantly differ across rural and urban areas within the country.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: MAGKS Joint Discussion Paper Series in Economics ; No. 38-2022

Classification and Topics

• Classification: Wirtschaft ; Geographic Labor Mobility; Immigrant Workers ; Urban, Rural, Regional, Real Estate, and Transportation Economics: Regional Migration; Regional Labor Markets; Population; Neighborhood Characteristics ; Housing Supply and Markets
• Subject: Immigration ; Housing prices ; Rents ; Instrumental variable ; IV quantile regression ; Germanhousing market

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Unal, Umut ; Hayo, Bernd ; Erol, Isil
• Event: Veröffentlichung
• (who): Philipps-University Marburg, School of Business and Economics
• (where): Marburg
• (when): 2022

Further information

• Handle: http://hdl.handle.net/10419/273876
• Last update: 10.03.2025, 11:46 AM CET