Berlin’s property investment boom is spreading across Germany, reveals new research from TheMoveChannel.com. German real estate has seen foreign interest rise since the UK’s Brexit vote, as the country emerges as a European safe haven.
The capital has been the main attraction for investors, thanks to the city’s growing population, placing greater demand upon its housing market. Indeed, according to foficial staistics from Statistik Berlin-Brandenburg, Berlin’s population was 3.67 million at the end of 2016, up from 3.65 million in the first half of the year and 3.52 million at the end of 2015.
With demand for accommodation still outpacing supply, property prices continue to grow, as do rents. Despite the recent introduction of rent control measures and a crackdown on Airbnb lettings, research from Savills shows that investor interest from overseas continues to grow. The transaction volume in the first half of 2017 totalled almost €6 billion, which represents an increase of more than 50 per cent compared with the corresponding period last year. North America, in particular, has fuelled that increase, with investors from the country accounting for 13 per cent of investment in the last 12 months, compared to the 2 per cent average recorded over the last five years.
In the face of political and financial uncertainty surrounding both Brexit and last year’s US presidential election, Germany has become the number one market for international investors, according to PwC, replacing the UK.
In the firm’s latest Emerging Trends Europe 2017 report, Berlin is ranked the number one city for investors, with Hamburg and Frankfurt in number two and
three, followed by Munich in fifth.
While Berlin remains top dog in Germany, though, interest in real estate is broadening beyond the city’s boundaries, with PwC highlighting the growing appeal of Frankfurt, as Germany’s business centre.
Data from TheMoveChannel.com shows that the capital accounted for 34 per cent of all enquiries for German real estate on TheMoveChannel.com in the last 12 months, down from 44 per cent in 2016. Bavaria is the second most popular region, with 9 per cent of activity (down from 10 per cent), followed by Saxony (8.8 per cent), Brandenberg (8.4 per cent, up from 7 per cent) and North Rhine-Westphalia (8.1 per cent, up from 8 per cent).
Ongoing interest from overseas investors occurs despite a national average slowdown in property price growth: according to Knight Frank’s latest Global House Price Index, Germany house prices slipped -0.2 per cent in Q1 2017 from the previous quarter, following growth of 2.9 per cent in Q4 2016. The country’s stable economy and growing population, though, continue to underscore the market’s fundamental appeal as a safe haven with strong investment returns.
Our German Property: By Numbers infographic breaks down the current market and investment trends into a handy at-a-glance guide: