City Ranking: The Greatest Need for Renovation in Real Estate is in the West - Germany’s real estate divide: East leads in energy efficiency, West lags behind
A new study has revealed stark differences in energy efficiency across Germany’s real estate market. The research examined rental and sales listings in 71 major cities, highlighting a clear divide between eastern and western regions. Properties in need of renovation are far more common in the west, while eastern cities boast some of the most energy-efficient homes.
The data, drawn from Immoscout24 listings in 2025, shows that 40% of German residential buildings fall into energy efficiency class E or worse. This classification means they require significant upgrades to meet modern standards. Bremerhaven, Salzgitter, and Krefeld top the list of cities with the highest shares of inefficient properties, at 61.5%, 60.4%, and 59.7% respectively.
In contrast, eastern cities like Chemnitz, Rostock, and Potsdam stand out for their energy-efficient housing. Less than 10% of homes in these areas need renovation. Other eastern locations, including Plauen and regions near Leipzig and Magdeburg, have also benefited from long-term investment. Federal and state funding programmes, such as Zukunftsfähige Innenstädte und Zentren, have supported modernisation efforts since reunification. These initiatives focus on revitalising city centres, improving infrastructure, and promoting energy-efficient renovations.
The study also found a trend among younger buyers. Cities with a high concentration of inefficient properties are attracting more residents aged 30 to 50. Affordability appears to be the main draw, as these homes often come with lower price tags. Energy-efficient properties, meanwhile, retain higher market value compared to those needing upgrades.
The findings underscore a regional split in Germany’s real estate quality. Western cities struggle with a larger share of outdated buildings, while eastern regions maintain better energy standards thanks to sustained funding. Younger buyers are increasingly turning to cheaper, less efficient homes, shaping demand in cities with older housing stock.
