The real estate market is suffering from increased key interest rates: prices are falling, supply is falling

The real estate market is suffering from increased key interest rates: prices are falling, supply is falling

According to a report by www.hna.de, the real estate market in Germany is affected by various factors that lead to falling prices and a shortage of supply. The increased interest rates, the stricter requirements of the banks and the associated higher financing costs are putting a strain on the industry. Bonds also play a role, the repayment of which puts housing companies under pressure. The number of building permits continues to fall and prices for offices and residential properties are falling dramatically. Many smaller property developers are expected to go bankrupt, which could lead to a further decline in supply. Real estate companies like Vonovia have to adjust the value of their properties downwards on their balance sheets, which can have long-term effects on the real estate supply for consumers. The refinancing situation for most real estate companies is expected to continue to deteriorate. Construction interest rates are around twice as high as in 2019, making the dream of owning a home more difficult for normal earners. Nevertheless, a study shows that it was more expensive to buy home ownership in the past. Nevertheless, current developments are putting a strain on the real estate market and could lead to long-term changes in the industry.

Source: According to a report from www.hna.de