Real estate market in upheaval: Financial expert warns of rising interest rates and unaffordable real estate

Real estate market in upheaval: Financial expert warns of rising interest rates and unaffordable real estate

According to a report from www.zvw.de, massive changes are being observed in the real estate market by Andreas Huss, an experienced real estate agent. In 2017 and 2018, there were more buyers than properties, creating a seller's market. Processing the sale was easy and many tried their hand at the real estate market. But in 2022 this changed drastically. The key interest rate was raised, which meant that borrowers had to repay significantly higher amounts than before. Banks also require 20% equity to be approved for loans. This means that many people can no longer afford real estate and prices are stagnating. Young people in particular are at a disadvantage in this situation. There are also additional costs for renovations, which further increases financial pressure. Andreas Huss supports funding programs and loan subsidies, but criticizes their complexity and suggests that the money would be better kept at the state banks, as this could make it easier to finance loans and boost real estate sales.

These developments have a significant impact on the real estate market and the industry. Since many people can no longer afford a property due to increased interest rates and equity requirements, there are more properties on the market than there are buyers. This leads to longer selling times and potentially lower prices as sellers come under pressure to sell their properties quickly. The high demand for renovations leads to an increased need for tradesmen and construction companies, while the complexity and restrictions of funding programs make the implementation of renovation projects more difficult. Andreas Huss's suggestions to make loans more affordable again could lead to more people being able to buy real estate and stimulate the market.

Source: According to a report by www.zvw.de