17. November 2009 
Print
Print
Prices for residential real estate rose slightly
October marked another month in which prices for residential real estate rose slightly. The total index was again supported more by apartments than by the other two categories. Prices for new homes have remained virtually stable, whereas existing homes progressed in unison with the total index. All categories are therefore showing marked stabilisation with a slight upward trend. The policies announced by the new government are aimed at both stabilisation and encouraging long-term growth.
Assessment and forecast:
Current purchasing terms and conditions are still a clear argument in favour of acquiring residential real estate. They are being joined by a slow but continuous recovery of the overall economic environment, which is strengthening consumer trust in future stability. Real estate prices are already reflecting the marginal increase in economic growth in the third quarter 2009: All individual indices are pointing upwards, resulting in an overall increase in the total index. The momentum provided by the government aid programmes for the automobile industry is bound to peter out soon. By contrast, the real estate sector expects sustained positive stimulation from the announcements by the new Merkel administration. Efforts to increase the home ownership quota, encourage renovation and refurbishment and to amend the laws protecting tenants could all add new momentum to the market. Over the short term, however, all three partial segments can be expected to remain stable.
Assessment and forecast:
Current purchasing terms and conditions are still a clear argument in favour of acquiring residential real estate. They are being joined by a slow but continuous recovery of the overall economic environment, which is strengthening consumer trust in future stability. Real estate prices are already reflecting the marginal increase in economic growth in the third quarter 2009: All individual indices are pointing upwards, resulting in an overall increase in the total index. The momentum provided by the government aid programmes for the automobile industry is bound to peter out soon. By contrast, the real estate sector expects sustained positive stimulation from the announcements by the new Merkel administration. Efforts to increase the home ownership quota, encourage renovation and refurbishment and to amend the laws protecting tenants could all add new momentum to the market. Over the short term, however, all three partial segments can be expected to remain stable.
