Growth factors of major cities in the DACH region - Examination of essential socio-economic criteria

Real estate markets do not develop by chance. In addition to fundamental geographical, economic, and political factors, especially socioeconomic developments should also be considered major drivers of individual real estate markets. These include parameters such as population trends, age structure, education, and jobs, as well as private income and public finances. In order to understand a city’s growth and real estate market potential, to assess market opportunities and risks, and to forecast development, the key factors upstream from real estate market development deserve a closer look. This study compares major cities in the DACH region – D (Germany), A (Austria), and CH (Switzerland) – based on their key socioeconomic factors and identifies various clusters of locations with similar characteristics. In some cases, the study revealed interesting alternatives to current target markets that feature similar socioeconomic parameters but receive less attention from investors and therefore offer untapped opportunities. For instance, Bonn and Mainz are two smaller cities that belong to the same socioeconomic cluster as the seven German Class-A cities and Vienna, Austria. 

Steffen Metzner, Head of Ressarch, Empira Group