Freiham Is Quietly Delivering Munich's Highest Rental Yields — and Investors Are Taking Notice

Freiham is beating the field. The sprawling new district anchored to Munich's western edge — formally part of the Aubing-Lochhausen-Langwied quarter — is generating gross rental yields of between 3.8 and 4.4 percent, according to figures compiled by Munich-based property advisory firm Colliers Deutschland for the first half of 2026. That is roughly double what investors can extract from comparable apartments in Maxvorstadt or Glockenbachviertel, where yields have compressed to 1.9 to 2.3 percent on average.

The numbers matter because Munich's broader market has spent the better part of three years recalibrating. After purchase prices peaked in 2022 — hitting a median of €9,800 per square metre for new-build flats in the city — rising interest rates and economic caution knocked values back by 12 to 18 percent across most inner districts by late 2024. Freiham, still largely under construction during that correction, entered the appreciation cycle later and at a lower base price, currently averaging €7,100 per square metre for new completions. That gap is precisely where the yield arithmetic becomes compelling.

What Freiham Has That Other Districts Don't

Infrastructure is the short answer. The U5 U-Bahn extension reached Freiham Bahnhof in December 2023, cutting the journey to Marienplatz to under 22 minutes. A second phase of the Freiham Nord development plan, managed under the city's Sozialgerechte Bodennutzung — or SoBoN — framework, has delivered nearly 1,400 new residential units since January 2025, with another 900 units under active construction along Parsdorfer Straße and the emerging Freiham Mitte axis.

The district is also home to the new Westkreuz commercial cluster, where several mid-size employers have signed leases since 2025, and the Freiham Quartierspark, a 65-hectare green space that opened in phases from 2024. Those amenities are pulling younger professional tenants westward from Pasing and Laim, who are priced out of Neuhausen-Nymphenburg — average rents there hit €22.40 per square metre in May 2026 — but still demand good connectivity and walkable services.

Rental demand in Freiham itself is running hot. According to data from Immoscout24's Q2 2026 Munich market report, advertised flats in the district receive an average of 74 applicant inquiries within the first 72 hours of listing, compared to a citywide average of 51. Average achieved rents for a 70-square-metre two-room flat currently sit at €17.80 per square metre per month, up 8.3 percent on the same period in 2025.

What Investors Should Watch Before Committing

Freiham is not without risk. A significant share of housing in Freiham Nord is bound by the SoBoN affordability conditions, which cap rent increases and restrict the investor pool for resale. Buyers need to scrutinise individual plots carefully — units built through private developers on non-SoBoN parcels along Am Knie and the southern Freiham corridor carry no such constraints and are the ones generating the headline yields.

The Munich city planning authority, Referat für Stadtplanung und Bauordnung, has signalled it intends to release a further tranche of building plots in the Freiham Süd area before the end of 2026, which could add supply pressure. Experienced local brokers are watching that release date carefully. Buyers who enter before the new supply lands will have a short window to lock in current yield levels; those who wait may find the market has already adjusted upward on price.

For investors working with a budget of €600,000 to €800,000 — enough to purchase a 75 to 85 square metre flat outright in Freiham at current prices — the arithmetic still holds even after factoring non-recoverable service charges and the Grunderwerbsteuer of 3.5 percent applicable in Bavaria. Run the numbers carefully, get a structural survey on anything pre-2023, and read the land register extract for SoBoN conditions before signing. Freiham's moment as Munich's yield leader is real, but it rewards due diligence rather than impulse.