Residential property sales in Germany have risen by 22% during 2011 when compared to 2010, with sales revenue of €10.37bn (£8.88bn) according to the German Real Estate Association (IVD).

Jürgen Michael Schick, vice president of IVD, said: "The turmoil in the capital markets has shifted demand toward real estate, leading both private and institutional investors to invest more in the property market.”

Berlin, Munich and Hamburg were the three leading cities for investors in the housing market.

Schick also said: “Medium-sized properties located in residential areas are currently experiencing a significant excess in demand, which could potentially lead to further price increases."