Munich, January 7, 2026 – Munich’s housing market is experiencing an unprecedented crisis, with rental prices continuing their steep ascent. This ongoing trend is severely impacting families, forcing them to make difficult choices and adapt to an increasingly unaffordable urban landscape. Despite the financial strain, many residents are demonstrating a strong resolve to remain in the city, highlighting the deep-rooted appeal of Munich.
The Escalating Rental Crisis: A City Under Pressure
The latest data underscores the severity of the situation. The average rent per square meter in Munich has risen to 15.38 Euros, a 5.5% increase over the past two years. While this increase is lower than the record 21% surge seen between 2021 and 2023, it still represents a significant burden for many households. For new leases, the average price stands even higher at 17.06 Euros per square meter. Social affairs officer Dorothee Schiwy noted that while the current increase is below the inflation rate, the overall rental level remains exceptionally high, exacerbating social issues related to housing. [sueddeutsche.de](https://www.sueddeutsche.de/muenchen/muenchen-mietspiegel-2025-hoehe-li.3204668)
Real estate agents report an overwhelming demand for affordable housing. Manuela Gerschlauer-Wüstenhagen, owner of the real estate agency Gerschlauer, described receiving hundreds of inquiries for a single rental listing within hours of its publication, often forcing them to remove ads due to the sheer volume of responses. This fierce competition makes finding an affordable apartment a matter of luck or connections. [sueddeutsche.de](https://www.sueddeutsche.de/muenchen/muenchen-wohnungen-mieten-preise-zahlen-li.3326846)
Families’ Resilience and Struggles
Despite the exorbitant costs, many families are choosing to stay in Munich. A recent survey among parents in a playground revealed their determination to remain, often citing strong community ties, quality of life, and educational opportunities as key factors. However, they also voiced urgent calls for change, emphasizing the immense financial pressure they face. The high cost of living means that for many, moving is not a viable option, even when life circumstances change. This immobility contributes to a stagnation within the city, affecting everyone, even those fortunate enough to secure suitable housing. [sueddeutsche.de](https://www.sueddeutsche.de/projekte/artikel/muenchen/muenchen-wohnen-mieten-preise-anstieg-neuvermietung-e208221/)
Political Response and Proposed Solutions
Munich’s Mayor Dieter Reiter (SPD) has called for federal action to address the root causes of rising rents, not just the symptoms. He advocates for an extension of the rent control (Mietpreisbremse) beyond its scheduled expiration at the end of 2025, and the elimination of its current exceptions, which do not apply to apartments rented after October 2014, furnished apartments, or student dormitories. Reiter also demands a time limit on modernization surcharges, which allow landlords to pass on renovation costs to tenants, and stricter regulations against excessive rents and usury. [sueddeutsche.de](https://www.sueddeutsche.de/muenchen/muenchen-mietspiegel-2025-hoehe-li.3204668)
Social affairs officer Schiwy also emphasized the need for a comprehensive reform of the rent index (Mietspiegel) itself. She argues that the current methodology, which only considers rental agreements from the past six years, acts more as a
