For expats in Germany who wish to buy or rent an old, but well-refurbished apartment, Berlin has the most affordable options, compared to Frankfurt or Munich, according to real estate portal GlobalPropertyGuide.
A 120 sq. m. apartment in Berlin costs around 3 000 euros per sq. m. In Frankfurt, the same sized apartment costs around 4 000 euros per sq. m. while in Munich it costs around 5 000 euros per sq. m.
Rents are also the cheapest in Berlin, ranging from around 11 euros to 12 euros per sq. m. per month. In Frankfurt, rents range from around 13 euros to 15 euros per sq. m. per month. Apartments in Munich are the most expensive to rent, with rents ranging from around 15 euros to 17 euros per sq. m. per month.
This means that one can rent a 120 sq. m. apartment in Berlin for around 1 300 euros, in Frankfurt for 1 700 euros, and 1 800 euros in Munich.
On the other hand, real estate investors, i.e., buyers of property for investment purposes, can earn the highest rental return on their investment from apartments in Frankfurt, where gross rental yields range from 4,24% to 4,68%. Rental yields in Berlin came in second, with small Berlin apartments earning as much as 4,29%. Rental returns for apartments in Munich range from 2,88% to 4,66%.
Source: http://www.globalpropertyguide.com/Europe/Germany/Rental-Yields