German market ‘busier than ever’
Germany is one of Europe’s top property investment prospects, reveals a new report…
Four German cities made the top 10 list of the Emerging Trends in Real Estate Europe Report 2008, compiled by the Urban Land Institute (ULI) and Pricewaterhouse Coopers (PwC).These cities were:
- Hamburg (3rd)
- Munich (4th)
- Frankfurt (7th)
- Berlin (9th)
The results are a mild surprise considering that Germany is not really renowned for high capital growth. Indeed, the Global Property Guide recently reported that Germany offers merely "moderate" rental yields.
Having said that, Berlin actually has some of the cheapest housing of any major European city, and this is attracting a wave of foreign buyers to the German capital, something that promises a new property boom after a false start after the fall of the Berlin Wall nearly 20 years ago.
Danes leading the way
Buyers from Britain, Scandinavia, Ireland and the United States are leading the rush to snap up flats in the once-divided city, making the 12 months up to November last year the busiest on the property market since World War II. Foreigners were responsible for 70 percent of the transactions, the German federation of estate agents said, with Danes spearheading the march. The interest is so high that Danish estate agents have opened offices here.
Andrea Magnoni, the Italian co-founder of the Valore fund, commented: "In Berlin, the price per square metre is one of the cheapest of any major city in Europe, including those in Eastern Europe. The return for investors is higher than anywhere else at between seven and eight percent compared to 3.5 percent in Milan because even if the rents are moderate the purchase prices are always low enough to guarantee a good rate".
