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31 03 2016
German Housing Market Is Booming

An extrapolation from the IVD (German Real Estate Association) shows that investments on the German real estate market rose by more than 12 % in 2015 compared to the previous year. With a total of investments of EUR 219.4 billion, it has been the highest amount for over 25 years. Real estate experts consider the solid German economy and a lack of investment opportunities to be the main reasons for these record levels on the housing market. Since there is no indication that this trend will end, the real estate sector still presumes a strong surge in the field of real estate investments.

Sharp Increase Of Real Estate Turnover In Almost Every German State

The positive development applies to almost every part of Germany. With the exception of Saarland, all other Bundesländer have recorded sharp increase in sales in the real estate sector. Brandenburg has noted the strongest sales growth. A rise in real estate sales of more than 35 % to a total of EUR 4.87 million has been recorded, on the one hand because property taxes have risen in June 2015 and on the other hand due to its proximity to Berlin. The main reason for this development is seen by IVD real estate experts in Berlin’s increasing attractiveness.  The latter has an impact on the surrounding area of Brandenburg. The German capital has recorded an increase in sales of more than 18 % amounting to EUR 2.06 billion. The strong demand for properties in Berlin and a broad section’s increasing propensity to invest cause prices to rise in the immediate vicinity of the city, too. Here the potential for value enhancements of an own property can be seen clearly.

Investing In A Property In Berlin Is Worthwhile

The purchase of properties in Berlin is worthwhile, as shown by the latest figures of the expert committee for land values. In 2015 alone, prices for condominiums rose by an average of 15 %. In the previous year, prices increased by 10 %. For whole residential buildings, single-family houses or semi-detached houses, the average rate of increase was even 20 % - a significant leap compared to previous year’s 10%. This comparison shows clearly that Berlin’s housing market still represents the best capital investment, despite higher prices. Since the sustained low interest rate and a strong demand combined with a simultaneous restrictive offer lead to further price increases. Berlin is the most dynamic market for condominiums, according to a current Immowelt -study. Due to a continued high influx and an extraordinary economic growth, the price inflation has been almost 90 % since 2010.