Low interest rates and not enough sites to build on have been increasing real estate prices in Germany for years.
Also in 2018, but now it is not just happening in the big cities.
In 2017, Germans also had to spend significantly more money to fulfill their dream of owning their own home. “The prices continue to rise,” said Peter Ache, branch manager of the working group of the expert committees of the German Press Agency.
In the working group the reports of the local expert committees come together. Unlike many market studies, they gain their insights from the actual sales contracts. The working group will present its next nationwide report at the end of 2019.
Based on the existing sales contracts, he estimates that up to 250 billion euros were paid for apartments, houses, land and commercial real estate. That would be around nine percent more than in the previous year, while the number of purchase contracts stagnated between 900,000 and one million.
Thus, the upward trend in the German real estate market has been continuing for ten years. “The supply is tight,” said Ache. “Not enough building land is brought to the market.” That applies above all to large cities. Low interest rates are fueling the prices. “There are not enough ways to invest money profitably.” Investors continued to rely on houses and apartments.
In the country, according to the real estate expert, houses are now becoming more expensive in many places. Because the prices are still comparatively low. “It is partly cheaper to buy a property than to rent one,” said Ache, referring to the favorable loans. Fears of a collapse of the market are unfounded from the perspective of the experts. “The lending is properly regulated in Germany. ”
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