In Upper Bavaria, the shortage of new construction projects is increasingly affecting the housing and real estate market. Experts warn of a “frighteningly shrinking housing production,” which is putting pressure on buyers and renters and could lead to further long-term increases in property prices.
Market Situation: High Demand, Few New Builds
Upper Bavaria is one of the sought-after residential areas in the Munich metropolitan region—not least because of its attractive location, good transport connections to Munich, and high quality of life. Despite this demand, however, there is a lack of sufficient new construction projects. Skyrocketing construction costs, strict energy requirements, and uncertain subsidy conditions often mean that approved projects are not realized.
Peter Schneider, CEO of Schneider & Prell Immobilientreuhand AG, describes the situation as a “central problem area”: since new construction is not happening, the existing housing stock gains in value stability, which pushes prices even higher in desirable locations.
According to the Pestel Institute, around 2,900 apartments are missing just between Icking and Jachenau, which further increases pressure on the already tight market. At the same time, the rising number of owner-occupancy terminations is further reducing the supply.
Rental Market and Price Trends
The low level of new construction also keeps the rental market hot. A survey by the German Real Estate Association (IVD) shows that housing production is not keeping pace with the number of new households—a reason why existing rents in the Munich metropolitan area rose by about one percent in autumn 2025 compared to spring.
In addition, as of January 1, 2026, the rent cap was extended to additional municipalities in Bavaria, including Bad Heilbrunn and Jachenau, to counteract this development.
(Source: Quelle:
Eick, Carl‑Christian: „‘Beängstigend‘ wenige Neubauprojekte: Das wirkt sich auf Immobilienpreise in Oberbayern aus“, Merkur (online), 19.12.2025, URL: https://www.merkur.de/lokales/wolfratshausen/wolfratshausen‑ort29708/beaengstigend‑wenige‑neubauprojekte‑das‑wirkt‑sich‑auf‑immobilienpreise-in-oberbayern-aus-94091972.html)
