Sunday, 16 December 2007

Rising residential rents in Germany

According to official statistics the number of new building permits has declined dramatically in 2007. In Bavaria e.g. by 40%. This is related to reduction in tax incentives for newly built property and modernisation on properties.
Property market experts already see significant rises in rents for residential real estate, in some regions by 5% compared to the previous year. Over the next years a 10% rise is deemed to be likely.

Commentary:
The positive outlook for investors is self evident. However the raise of the general rent level does not mean automatic increase in income. The opportunities and best approach need to be assessed and appropriately managed to receive the most drive on the value of the property. An effective Asset Management Strategy is key to get the most benefit out of this opportunity.


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