From a “problem area” to the “epicentre of cool”
Neukoelln- A Changed Image
It would be impossible to deny that Berlin’s south-eastern district of Neukoelln has had a colourful history. Since the fall of the Berlin wall in 1989, Neukoelln has faced some huge challenges and undergone some of the biggest changes of all of Berlin’s districts. While Neukoelln still has a way to go before it can be considered on a par with its neighbouring districts of Kreuzberg and Friedrichshain, its image has been gradually changing from a “problem area” to an area now described as the “epicentre of cool” ( Söderberg, 2016).
Today it’s a lively and unique place that’s become particularly popular with families and creative people of different ages, backgrounds and languages from not only Berlin but around the world. There is always something to do in Neukoelln, be that visiting a Sunday morning flea market along the beautiful Landwehrkanal, or having a beer on a buzzing rooftop bar on a Wednesday evening. Neukoelln is also in very close proximity to the famous ‘Tempelhofer Feld’- this abandoned airport now makes for a fantastic park, including a running and bike track along the former runways, picnic areas and also a community garden.
I recently conducted a short interview with property expert and Black Label director Achim Amann and asked for his thoughts on Neukoelln today and why he believes it’s such a great area in which to invest:
Do you believe Neukoelln is becoming a more attractive place to live and if so, why?
Yes, Neukoelln’s location is very central and as a result of great public transport connections and the many new shops, bars and clubs that have opened in the past few years many southern Europeans have recently settled here, for example. The area is currently undergoing heavy gentrification; Neukoelln used to be home to the German working class and then it became the home of many Turkish immigrants, followed by Arabic immigrants and today the international art and hipster scene is on the rise there.
Why is Neukoelln such a good place to invest in property?
At Black Label we have had some of the best performing properties in Neukölln, and we are still seeing serious growth there. Currently we are having 4% per quarter rise in prices, but we believe that 10% per year is realistic in the better locations of Neukölln. It’s also important to keep an eye out for the more distressed-looking properties that are not in good condition for these properties often have the best chances of rising in value in the next couple of years.
Who is buying or investing in Neukoelln? Is it people who previously lived there, or outsiders such as international investors?
Buyers of property in Neukoelln are mainly outsiders, many of whom are people who have just moved to Berlin. Plenty of international people who are working in Mitte or Kreuzberg buy flats in Neukoelln as well as investors who purchase buy-to-let apartments. Properties purchased in Neukoelln are mainly studios or small flats with one or two bedrooms.
Do you think property prices in Neukoelln will continue to increase as rapidly as they are currently doing today?
Last year there was a 20% increase and this year again we are looking at a growth of over 15% p.y. We expect however that prices will increase at 10% per year as a realistic growth rate over the next couple of years in certain areas of Neukoelln. This is of course a very good outlook for investors comparing the other asset classes they can invest into.