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Even nearly two decades after the fall of the Berlin Wall, there are still two distinct parts to Berlin: The west is the sophisticated, more conservative half; and the east is edgier, with happening neighborhoods like Mitte and Prenzlauer Berg. Cheap rents are attracting creative young stylemakers from around the globe—more than 40 percent of the 3.4 million residents are under the age of forty-four—and many of them are artists. For some years, Berlin’s contemporary-art scene has been on fire, and prestigious galleries, including New York’s Goff+Rosenthal, have opened outposts here in order to secure the local talent. Last fall’s successful Art Forum Berlin drew the movers and shakers of international art, who arrived in full force for the parties and shows. The energy is so palpable, especially in the eastern neighborhoods, that it calls to mind New York during the heyday of Jackson Pollock, Jasper Johns and company.

In 2008, the city’s cool rating should increase even more: British impresario Nick Jones plans on opening an outpost of his Soho House in the Prenzlauer Berg neighborhood in a historic building that used to house the East German Communist headquarters.

While Berlin’s debt remains a quandary for the government, it’s an advantage for today’s travelers. No need to fret over the recent downward spiral of the dollar in Germany. Affordable deals can be found all over Berlin, both in terms of accommodations and leisure activities. To wit: luxury hotels are less expensive than their counterparts in London or Paris, and $50 will buy you a three-course dinner at many high-end restaurants. In short, there’s never been a better time to visit (or revisit) Berlin.