10.09.2026 • 27/2026
EREI-Update: Rents in Europe’s cities are 23% higher on average than in rural areas
The European Commission currently prepares the Affordable Housing Act to tackle widespread concerns about tight housing markets, for example voiced by the German Tenants' Federation (DMB) which blames rising rental cost as one main driver of a social crisis in Germany. The latest European Real Estate Index (EREI) by the Halle Institute for Economic Research (IWH) shows that rental prices in Germany rose indeed three times compared to the European average in August. Moreover, the rental premium in metropolitan areas vis-à-vis the average in non-metropolitan areas in eleven EU member states amounts to 23%.
Michael Koetter
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02.09.2026 • 24/2026
Launch of the European Real Estate Index (EREI): German housing prices continue to rise more slowly than in Europe
Growth in asking prices for German residential properties offered for sale has lagged the European EREI aggregate since spring 2025. This is shown by the new European Real Estate Index (EREI) presented today by the Halle Institute for Economic Research (IWH). This novel data service hinges on more than 43 million listings on online real estate platforms and provides monthly comparisons of residential asking prices and advertised rents across 1,154 European regions in near-real-time.
Michael Koetter
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Smooth and Persistent Forecasts of German GDP: Balancing Accuracy and Stability
Katja Heinisch, Simon van Norden, Marc Wildi
IWH Discussion Papers,
No. 1,
2026
Abstract
Forecasts that minimize mean squared forecast error (MSE) often exhibit excessive volatility, limiting their practical applicability. We address this accuracy-smoothness trade-off by introducing a Multivariate Smooth Sign Accuracy (M-SSA) framework, which extracts smoothed components from leading indicators to enhance the signal-to-noise ratio and control the forecast volatility and timing. Applied to quarterly German GDP growth, our method yields smoothed forecasts that can improve forecasting accuracy, particularly over medium-term horizons. We find that while smoother forecasts tend to lag slightly around turning points, this can be offset by adjusting the forecast horizon. These findings highlight the practicality of the M-SSA framework for both forecasters and policymakers, especially in settings where forecast revisions or policy adjustments are costly.
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