Rising energy and food costs will cause rents to go up by a national average of two to three percent in urban areas, the highest increase since 1997, experts from the German Real Estate Professional Association (IVD) told the paper.
In sought-after neighbourhoods, rents could rise as much as five to eight percent.
IVD experts said demand for living space has intensified because new building project approvals are at their lowest since the end of World War II.
The IVD also attributed a growing number of renovations that adhere to environmental standards as a factor in rent hikes.