Rising prices: Germany at an all-time high
It is known that the real estate market is extremely susceptible to economic and social changes in a nation. In fact, during the past year, as proof of this, in most European capitals, property prices have collapsed. The reason is simple. The lack of the possibility of potential investors to view or conclude the purchase of a property, has led the owners themselves to decrease the sale prices for such properties to be purchased.
An attempt that we could define as desperate, aimed at maintaining the national economy. In today's column, we will analyze a very particular phenomenon that has affected several European nations in the post-pandemic period. The one related to the increase in property prices. Today's protagonist is Germany, a nation in which house prices have risen by almost 10% on an annual basis already in the first quarter. A large increase, which confirms the upward trend, which has been constant for at least a decade. Now let's see if a real estate bubble can be generated in this country, as many fear.
In today's column, therefore, we will try to analyze in detail what the current situation is and how it may evolve over the following months. So, if you are ready and intrigued by the subject ... we can begin!
In another historical moment such a significant increase would not have caused the same uproar that it is receiving in this period. The one recorded today is the largest economic rebound in the last 10 years. But why hasn't Germany stopped even during a pandemic that has brought all international economies to their knees?
There are different reasons that justify this result. First of all we remember how Germany, the first European economy, has very low interest rates. We also remember the expansionary monetary policy of the European central bank and last but not least the excellent economic situation of the country. If this was already the fertile ground to ensure constant growth in terms of property prices within the country, further additional conditions also need to be considered. During the pandemic emergency, the German construction industry suffered a severe backlash. The cause ? Mainly the lack of raw materials such as steel, wood and materials for thermal insulation (fundamental for this sector).
Reason why the increase in the prices of pre-existing houses was more physiological. But that is not all. It must also be considered that various maneuvers have been adopted by the government to avoid an economic crisis. For example, the law on the freezing of rents in the capital, Berlin, which we talked about in one of our previous columns.
A fairly critical situation that saw the further increase in market prices as the only solution. Munich and Frankfurt are in the sights of industry experts as they are the only two cities with the highest risk of a housing bubble in the world. But according to the German public reconstruction bank KFW, there is no reason to be alarmed.
We do not know how this situation will evolve. This is why we cannot give certain forecasts. But, if you want to know more about this and many other topics related to the real estate market (and not only), you just have to stay up to date here! Always and only on Realigro!
An attempt that we could define as desperate, aimed at maintaining the national economy. In today's column, we will analyze a very particular phenomenon that has affected several European nations in the post-pandemic period. The one related to the increase in property prices. Today's protagonist is Germany, a nation in which house prices have risen by almost 10% on an annual basis already in the first quarter. A large increase, which confirms the upward trend, which has been constant for at least a decade. Now let's see if a real estate bubble can be generated in this country, as many fear.
In today's column, therefore, we will try to analyze in detail what the current situation is and how it may evolve over the following months. So, if you are ready and intrigued by the subject ... we can begin!
In another historical moment such a significant increase would not have caused the same uproar that it is receiving in this period. The one recorded today is the largest economic rebound in the last 10 years. But why hasn't Germany stopped even during a pandemic that has brought all international economies to their knees?
There are different reasons that justify this result. First of all we remember how Germany, the first European economy, has very low interest rates. We also remember the expansionary monetary policy of the European central bank and last but not least the excellent economic situation of the country. If this was already the fertile ground to ensure constant growth in terms of property prices within the country, further additional conditions also need to be considered. During the pandemic emergency, the German construction industry suffered a severe backlash. The cause ? Mainly the lack of raw materials such as steel, wood and materials for thermal insulation (fundamental for this sector).
Reason why the increase in the prices of pre-existing houses was more physiological. But that is not all. It must also be considered that various maneuvers have been adopted by the government to avoid an economic crisis. For example, the law on the freezing of rents in the capital, Berlin, which we talked about in one of our previous columns.
A fairly critical situation that saw the further increase in market prices as the only solution. Munich and Frankfurt are in the sights of industry experts as they are the only two cities with the highest risk of a housing bubble in the world. But according to the German public reconstruction bank KFW, there is no reason to be alarmed.
We do not know how this situation will evolve. This is why we cannot give certain forecasts. But, if you want to know more about this and many other topics related to the real estate market (and not only), you just have to stay up to date here! Always and only on Realigro!
