In order to define an area as a residential location, you must take into account not only the actual location. A whole series of factors flow into the assessment of location. But to put it simply, a residential location is land which is built up mostly with housing. Over time, three classifications have emerged for this assessment in Germany. According to this classification, a property can be in a simple, medium, or good location. Anyone who is interested in buying a flat or is a potential tenant should be very familiar with the various locations in the region where the property is to be bought or rented. A close look at the residential location classification can provide a helpful basis for negotiations. The location of a property can be divided into two areas. This is the micro-location and the macro-location. The latter describes the spatial, larger environment of a property, such as the region, the city or the district. In the case of the micro-location, the focus is on the direct surroundings of the property, for example the neighbourhood, the surrounding street or the residential area.

In order to determine the value of an apartment or house and its residential location, many potential factors must be taken into account. When it comes to the macro-location, the main influencing factor is the infrastructure of the area. This includes not only the connection to highways and public transport, but also the number of shops in the area, care and education facilities, restaurants, as well as recreational opportunities. These elements influence the quality of living and the demographic of the location. The economic strength of the region is also a decisive criterion. Whether there are enough jobs or the area is attractive for students or tourists - all this affects demand and thus the property value. Various aspects also play a role in assessing the micro-location. Is it a quiet or rather busy area? What is the population structure? What is the distance to public facilities? These questions must be answered in detail in order to determine the value of the residential location.

In order to standardise the classification of residential areas and thus make the valuation of a property more transparent, three valuation categories were created in Germany. These include simple residential area (einfache Wohnlage), medium residential area (mittlere Wohnlage) and good residential area (gute Wohnlage). Properties in a simple residential location are surrounded by a closed, dense development. There is usually little nature here, the structural appearance is functional, and it is not uncommon for the properties to be located in direct proximity to industry, road traffic, or other sources of noise that can be perceived as disturbing. The medium residential location is characterised by the visually more attractive condition of the surroundings. This applies not only to the properties themselves, but also to existing green spaces. Supermarkets provide for daily needs. Local medical care and a good infrastructure that is not affected by noise are also guaranteed. Properties are often located in open-plan residential areas. A well-kept street scene, generous green spaces, and a generally positive image of the urban area are decisive for classification as a good residential location. The residential environment is upscale, the condition of the buildings is good, and the transport connections are also optimal. Prices are generally higher here, as the quality of living is also of a corresponding level.

Berlin is characterised by an enormous variety of residential areas. In order to provide an overview of the quality of the locations, the residential location map (Wohnlagenkarte) was created. It makes it easier to determine the residential areas in Berlin and shows which areas have the rent cap. The list of residential areas is revised and updated by a special working group every time the rent index is renewed. The working group acts as a committee of experts; the know-how of an external institute is consulted for the classification into the different categories simple, medium or good. The directory creates an opportunity for potential buyers, tenants or apartment owners to realistically assess the living situation in Berlin, which is sometimes complex and confusing due to the areal expansion of the capital. The locations are categorized by the Berlin Senate Administration . So if you are interested in a property in the German capital, whether as an investment property or for your own use, the residential location directory provides a helpful basis for negotiations. You can also see directly in which urban areas the rent cap applies.