Wednesday, 9 May 2012

No Price Bubble in The German Housing Market 2012

The Association of German Pfanbrief Banks (vdp) does not see any indicators for a price bubble in the German Housing Market. The positive climate with moderately rising prices started three years ago and continues at steady pace.
Owner occupied apartments saw price increases of 1% to 3% with exceptions in big cities like Berlin (8.6%), Hamburg (8.1%) and Munich (8.7%) where the price increase exceeded 8%. With a Consumer Price Index increase of 2.3% for the same period the German Housing Market is far away from a price bubble. The Bundesverband der Deutschen Volksbanken und Raiffeisenbanken (BVR) comes to he same conclusion.

For data details in German please visit this link.

Especially the Berlin Housing Market is still undervalued compared to other metropoles and also still catching up on rent levels. The demand for investment properties by international investors is very apparent in the market and will increase the pressure in yields.
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Uwe Falkenberg


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