Hi Neustria,

From what I know of Konstanz it'll be a very safe place to invest, prices won't rise significantly but nor will they decrease. I did look at some smaller German cities and one key factor is Expected population growth/decrease - The Germany population will start to decrease soon but not everywhere equally. Eastern Germany in particular is losing people even cities e.g. Berlin

I don't know much about Commerical property unfortunately, but you should look into the tax implications particulary if depreciation is possible. A German Taxpayer who buys a flat for someone else to live in (Kapitalanlage) can depreciate a portion of the property. This is set by the local authority which divides the flat value into "Bricks and Mortar" and Ground. The bricks and mortar element usually makes up to 70% of the value and you depreciate this over 50 years at 2% per year.

Most flat purchasers in Germany are therefore more interested in the Tax benefits than capital appreciation. Also if you keep the flat for 10 years then sell it, you don't have to pay capital gains tax on any increase.

Best regards,
Martin