A hostage situation in a residential area in the southern German city of Karlsruhe has ended with the deaths of all four hostages and the gunman.

Local police say the killing on Wednesday, local time, took place after a man in his 50s had a fight with a bailiff over his failure to pay rent.

The man took his girlfriend, the bailiff, a locksmith and the flat's new owner hostage before killing them after a three-hour confrontation with police. He then turned the gun on himself.

Police say special forces broke into the apartment and found all five dead.