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Germany Property Investment News
'Robust economy' makes Germany a good bet for investors
According to analysts, Germany’s stable economy and steady property prices will make it an appealing market for many real estate investors over coming months, as well as for larger, long-term investors such as pension funds and state-owned investment vehicles.
According to a recent Commerzbank report on the German real estate market, Germany has a unique balance which has kept prices relatively stable, as buyers are holding back waiting for prices to drop, while sellers have been similarly inactive while they wait for a recovery in prices.
“In comparison to other international property markets such as the UK, Germany is less advanced in the cycle, ranks among the most liquid markets and its yields are attractive”, Commerzbank has said, going on to predict a “shifting of assets from countries that are more advanced in the cycle, such as Spain or the UK.”
With an interest rate increase expected in the next year from the European Central Bank, many investors will be eager to invest before the cost of borrowing increases, according to CBRE’s head of investment in Frankfurt, Burkhard Plesser. He went on to predict that a number of high-profile transactions over coming weeks could instigate a flurry of action from other banks and investors.
Potential individual investors in German property will welcome the news, since Germany has long been considered a potentially profitable market. After a long period of inactivity with low levels of homeownership, the strength of the market is in its potential once demand begins to rise. With Germany now seeming separate from many of the other, more trouble European markets, this could well be the spark it needs.
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