This blog analyses the Trendbarometer for the German Real Estate Market in 2012, made by the international consulting firm Ernst&Young.
Eighty real estate funds, building societies, banks and insurance companies from home and abroad participated in the survey for 2012, which is done every year.
Ninety nine percent (99%) of the respondents mentioned their deep interest in investing in Real Estate in Germany, despite the eurocrisis. This huge value surpasses the values from the studies of previous years: In 2011, the number was 86% and in 2010, 78% considered Germany as an attractive or very attractive real estate location.
Investors have a deep inclination towards German property market over the rest of Europe, due to its economic stability and “safe haven” as a property investment location. Due to the good demand, properties in popular locations will become more attractive for investors, were 70% assume that prices will remain stable for this year.
Apparently, residential and retail properties are amongst the most desired to purchase due to its price development over the past years. Berlin was ranked as first for best location to invest in residential properties (with 42% of favoritism), while Dusseldorf, Cologne and Munich for office investments.
Christian Schulz-Wulkow, partner at Ernst and Young and author of the study, stated that the transaction volume for these specific types of Real Estate will not decrease in 2012, but are expected to remain by the same level as in 2011: 28 billion euros.
Germany was the country that performed better among the European countries, 50% of interviewed expect an increase in property sales for the year. Nowadays, Germany is regarded as a safe and stable property market, due to good investment experiences in the Real Estate crisis in 2009.
Equity rich investors will be the dominative group of buyers as well as family offices, with an increased net worth of private investors. International funds will play an important role as well, despite the worldwide concerns about inflation problems which is why it seems like Germany´s Real Estate sector is benefiting from the increasing uncertainty in other euro countries.
All in all, the most important reasons to why Germany is elected as number 1 in residential and retail property investments is because of fears of inflation throughout all euro countries, as approximately 9 out of 10 respondents stated, optimum investment experiences in the past counting on the country’s steady and strong Real Estate market.
