Homes in German Cities Up to 20% Overvalued, Bundesbank Says

Apartments in Germany’s largest cities may be overvalued by as much as 20 percent as home demand outpaces construction, the Bundesbank said.

Apartment prices in parts of Berlin, Hamburg, Munich, Cologne, Frankfurt, Stuttgart and Dusseldorf have risen by more than 25 percent on average since 2010, the central bank said in its October report. Prices in areas around those cities may be climbing due in part to speculation.