Capital Investment Property in Pforzheim: Figures, Locations, and an Honest Calculation

Romolo Marini · 2026-10-13

If you are looking for a flat as a capital investment in Baden-Württemberg and are watching your budget, you will sooner or later end up in Pforzheim. A used flat costs on average around €2,600/m² here, significantly less than in Stuttgart, Heidelberg, or Ulm. Stuttgart and Karlsruhe are easily reachable by train.

The low price has its reasons. Pforzheim has one of the highest unemployment rates among large cities in the state and an economy heavily dependent on industry and suppliers. At the same time, the city is growing, and for the first time, a rent control (Mietpreisbremse) has been in effect since 2026.

We have compiled the official figures and, at the end, calculate the monthly additional payment before and after taxes for both a used and a new flat.

01Pforzheim in numbers

All values we use for classification, with source and status.

02Population and demand

At the end of 2025, 134,422 people lived in Pforzheim, just under 500 fewer than a year earlier. However, the city has grown significantly over ten years: in the extrapolation of the State Statistical Office, the number of inhabitants rose by 9.5 % from 2013 to 2023.

For the future, the Wegweiser Kommune of the Bertelsmann Stiftung is remarkably optimistic. It expects an increase of 7.7 % from 2020 to 2040, more than for Ulm or Heilbronn. Whether this happens depends heavily on migration, which fluctuates. The decline in 2025 shows that growth is not a sure thing.

In the 2022 Census, 42.0 % of Pforzheim households lived alone, fewer than in university cities. Pforzheim is more of a city for families and couples. 63.2 % of flats were rented, 35.1 % were occupied by their owners.

The housing stock is old. Around two-thirds of the flats (67 %) were built before 1980, many of them in the reconstruction period after the almost complete destruction of the city center in February 1945. These houses are often in need of renovation today.

03Economy and labor market

Pforzheim is known as the Gold City, with a long tradition in jewelry and watch manufacturing. Today, precision engineering, metal processing, medical technology, and suppliers for the automotive industry shape the economy, along with trade and services. The companies are predominantly small and medium-sized. There is no single large employer that dominates the city.

This protects against the failure of a single company, but not against weakness in the entire sector. The automotive industry and its suppliers are under pressure, and this is becoming apparent in Pforzheim more than elsewhere.

The unemployment rate was 7.5 % in September 2026, 0.2 points lower than in August. 58.7 % of the unemployed were receiving basic security (Grundsicherung), meaning they had often been without work for a longer time. This is a serious point for landlords. A portion of the tenants cannot afford higher rents, and a loss of rent is more likely than in Ulm or Heidelberg.

Pforzheim University, with its focus on economics, technology, and design, had around 5,600 students in the winter semester 2024/25. It brings demand for small flats, but shapes the market less than the universities in Heidelberg or Tübingen.

04Rents, purchase prices, and rental yield

Pforzheim has had a newly surveyed qualified rent index (Mietspiegel) since 01/04/2025. The city contacted 5,000 households for this and used a statistical regression method for the first time. The average net cold rent is €8.58/m², 9.02 % more than in the 2023 rent index. For a 65 m² flat from the 1970s, it lists a base rent of €7.94/m², plus surcharges for modernization and equipment.

The Valuation Board counted exactly 643 sales of flats in 2025. Used flats cost on average around €2,582/m², 3 % more than in the previous year. A typical flat with 70 m² thus cost around €181,000. Only ten new-build flats were sold, at an average of around €5,110/m². An average from ten sales says little about the market.

Useful are the yield factors of the Valuation Board. It calculates how many annual rents buyers have paid from actually sold and rented flats. For two-room flats with an average of 59 m², this factor was 24.1, the rent in these flats was €8.80/m².

At around 4 % gross, Pforzheim is significantly higher than Heidelberg, Ulm, or Heilbronn. The purchase price factor (Kaufpreisfaktor) of about 25 means that the flat would be paid for after 25 annual rents, before costs. The higher gross rental yield (Bruttomietrendite) is not a gift, however. It is the price for a higher risk in the event of rent loss and maintenance. You can check your own figure with the rental yield calculator (Mietrendite-Rechner).

05City districts at a glance

Pforzheim consists of the core city and the districts of Büchenbronn, Eutingen, Hohenwart, Huchenfeld, and Würm, which the Valuation Board evaluates separately. It does not publish prices for flats per district freely. Therefore, we describe the character without price information.

For investors, this means: the cheapest flats are often in the densely built districts of the core city, where the stock is oldest. Quieter hillside locations and districts cost more, but often bring a more stable tenant base.

06Rules for landlords in Pforzheim

Pforzheim has been a regulated rental market since 2026. The state ordinances expire at the end of 2026; the state wants to extend them.

• Rent control (Mietpreisbremse): Since the current state ordinance, it also applies in Pforzheim for the first time. In the case of a new letting, the rent may not exceed the local comparative rent according to the rent index by more than 10 %. Excluded are flats that were used and let for the first time after 01/10/2014, and the first letting after comprehensive modernization. You may continue to charge a higher previous rent.
• Cap on rent increases (Kappungsgrenze): During the ongoing rental relationship, the rent may rise by a maximum of 15 % in three years and never above the comparative rent.
• Planned extension: Both ordinances apply until 31/12/2026. The state government submitted drafts for the period from 01/01/2027 to 31/12/2029 for consultation on 22/09/2026; Pforzheim continues to be included. Nothing had been proclaimed as of 13/10/2026.
• Termination blocking period: If a rented flat is converted into property, the buyer can only terminate for personal use after five years.

When buying, you pay 5.0 % real estate transfer tax (Grunderwerbsteuer) in Baden-Württemberg. Added to this are notary and land register costs of around 1.7 to 1.8 % of the purchase price if you are financing, and depending on the property, an estate agent. Your purchase costs are calculated by the purchase cost calculator (Kaufnebenkosten-Rechner), the positions for the notary are explained in our article on notary costs (Notarkosten).

07Example calculation: a rented flat in Pforzheim

Let's take Daniel, 33, single, technician at a supplier, with a taxable income of €55,000. He buys a rented flat with 65 m² from the 1970s at the average price of used flats in 2025. The rent corresponds to the average of the rent index. The name is invented, the figures are a calculation example and not a forecast.

In this example, Daniel pays around €177 a month, after taxes. €210 of this flows into repayment. If repayment is not considered, a small surplus of around €33 per month remains after taxes. Here, the rent at least covers the interest, unlike in the more expensive cities in the state.

The surplus is thin, however. A single month of vacancy or a major repair eats it up. Our article on taxing rental income (Mieteinnahmen versteuern) explains how rental income is taxed.

In Pforzheim, vacancy weighs heavier than in most other cities in the state because unemployment is higher. In your calculation, it is better to plan one month too many than too few.

For comparison: a new-build flat in Pforzheim

What changes if Daniel buys a newly built flat? For 2025, the Valuation Board cites an average of around €5,110/m², although from only ten sales. For 45 m², this results in €229,950. Daniel pays real estate transfer tax (€11,498) and notary and land register fees (€3,819) again from equity, totaling €15,317. As rent, we assume €11.27/m², the base rent of the 2025 rent index for 45 m² from year of construction 2020. Surcharges for particularly high-quality equipment could be added but are not automatically achievable in new builds.

Compared to the used flat, the depreciation in the first year is more than three times as high (€9,762 instead of €2,853), and usually less maintenance occurs in a new house in the first years. In return, the square meter costs almost twice as much, the gross rental yield drops to around 2.6 % instead of 4.0 %. After taxes, Daniel pays around €186 a month here, about the same as in existing stock, but before taxes almost twice as much. In Pforzheim, the gap between existing and new construction regarding yield is larger than in more expensive cities because the existing prices are so low. The tax savings decrease in the following years because the degressive depreciation is calculated from the respective smaller residual value. The rent control does not apply to the flat in the long term according to § 556f BGB.

08Opportunities and risks in Pforzheim

Proven points speak for Pforzheim. Purchase prices are among the lowest among the large cities in the state, the gross rental yield is around 4 %, and the rent covers the interest in the example. The city has grown significantly over ten years, and Stuttgart and Karlsruhe are easily reachable.

On the other hand, there are equally clear points:

• Labor market: 7.5 % unemployment, more than half of the unemployed in basic security.
• Industry risk: Many jobs depend on industry and automotive suppliers, which are under pressure.
• Old stock: Around two-thirds of the flats date from before 1980; renovation backlogs can trigger special levies.
• Long vacancy: 1,102 flats had been vacant for a year or longer at the time of the Census.
• New regulation: The rent control has been in effect since 2026, new lettings are no longer freely negotiable.
• Interest and rent loss: A higher Anschlusszins (interest rate on follow-up loan) and a month without rent immediately cost the small surplus.

The advantages and disadvantages of a flat as a capital investment in general are in our article Flat as capital investment.

09Further locations

Other cities in Baden-Württemberg: Overview Baden-Württemberg · Freiburg · Heidelberg · Heilbronn · Karlsruhe · Konstanz · Mannheim · Stuttgart · Tübingen · Ulm

All locations in comparison: Where is a capital investment property worth it? Cities compared 2026 · Which federal state is suitable? All 16 in comparison

10Further reading

• Flat as capital investment: advantages and disadvantages
• Taxing rental income
• Notary costs for property purchase
• Rental yield calculator
• Purchase cost calculator
• Real estate transfer tax in Baden-Württemberg

11Sources

All sources accessed as of 13/10/2026.