Editor's Choice: Southeast Asia Real Estate
With the advent of cold weather in our latitudes, interest in Southeast Asia always begins to actively grow - both in tourist trips and in the acquisition of housing in…

Continue reading →

Taxes on real estate in Italy
According to the latest statistics, Italy is one of the few countries in Europe where, although not globally, there is a decrease in the value of real estate, due to…

Continue reading →

Taxation of Real Estate Income in Spain
Foreigners who are not citizens of Spain are required to pay income tax in Spain. Married couples who are not citizens of this country can fill out their income tax…

Continue reading →

Germany’s real estate market: investment in a country with a stable economy

Germany is deservedly associated with stability and practicality around the world – similar characteristics also apply to the real estate world of this country, therefore it is not surprising that investors from all over the world try to invest their funds in square meters of Germany whenever possible.
A strong economy, thoughtful legislation, political stability, and a high standard of living – these factors make Germany particularly attractive to foreign investors who see real estate in Germany as a safe haven for investing and preserving capital. It is also interesting that the rental system reigns in the German real estate market: if the national average is around 50%, in large cities up to 90% of the population rents housing. According to Forbes, Germany is the leader in Europe in terms of rental housing, which amounts to about 55%, leaving Austria and Poland behind with a large lag.

Buy real estate in Germany

It is not surprising that in 2018 real estate in Germany – the country with the most stable economy in Europe – went up by 5.6%, largely due to the low interest rates of German banks, population growth and low unemployment. The total amount of transactions in 2018 amounted to 124.8 billion euros – a new record for the residential real estate market in Germany, the Team Global Corporate Communication report says. For comparison, in 2017, investment amounted to about 119.3 billion euros. This trend continued in 2019, but unlike in previous years, the wave of demand also spread to secondary cities, since in key cities such as Berlin and Munich, etc., prices reached such a peak that investment objects gradually lose their attractiveness for buyers, both foreign and local. Today, “new” cities are gaining popularity, for example, Nuremberg and Hanover and nearby cities – the cost of real estate in them is still available, therefore, the percentage of capital investment growth, as well as profitability and rental income, are higher than in more popular places.

Trends
The first “seven” cities in Germany and their environs are characterized by stable annual price increases in both private and commercial real estate. Over the past three years, the value of residential real estate in Berlin, Munich, Frankfurt, Hamburg, Dusseldorf, Cologne and Stuttgart has grown by more than 30% and, according to experts, will continue to grow. This is due to the fact that in these cities the demand is several times higher than the supply, largely due to the large influx of the working population to large cities in western Germany. If we consider residential real estate and compare prices for March 2007 and November 2017, then prices for apartments in the secondary market increased by 180.2%, and the cost of apartments in new buildings increased by 177.4%. This situation is “on hand” for investors, as apartments in cities are often purchased for rental. Therefore, in a growing market, investors can earn twice – earning rental income, as well as earning directly from rising housing prices.

Buy real estate in Germany

The following trend follows: according to the German Investment Real Estate Union (DAVE), the suburbs of large cities in Germany, located in a radius of 20-30 km, are currently becoming more and more popular with investors, since prices are not as high as in large cities themselves and the choice of affordable real estate is more. Accordingly, prices in these suburbs also show steady growth. It is important to understand that in Germany, cities with even a small population by Russian standards, for example, up to 10,000 people, have excellent transport links and complete infrastructure, from kindergartens to pools.

Loans in Germany
Another important trend in the real estate market in Germany is low credit rates from 0.8% to 1.8%, which can also be used by non-residents of the country. Low default mortgage rates at low Euribor rates made the German mortgage interest rate the lowest in the world: now it averages about 1.6% per year. The borrower will nevertheless need about 20% of the down payment of the total loan amount – one of the leverage by which the German government prevents the formation of a “credit bubble”.

Buy real estate in Germany

Non-residents of the country is easiest to get a loan in Germany for the purchase of an apartment, which is planned for rental or for their own residence. It is also relatively easy to get a loan for apartment buildings – here the quality of the building, the location and the number of apartments leased (i.e. income) will be taken into account. It is also realistic to get loans for stores with long-term lease agreements (more than 10 years), but banks are reluctant to give funds for hotels – the issue is considered under the condition that the hotel fund exceeds 100 rooms.

Real estate in Monaco: advantages of buying
The cost of housing in Monaco has traditionally been very high for many years, but those who wish to purchase in the famous principality have not diminished - what is…

...

Turkey Real Estate: Chronicle of Recent Years
Turkey today is in the top 3 countries where Russian buyers are acquiring residential real estate on a massive scale - after a short lull, the local housing market is…

...

Pet moving to a foreign house
The possession of foreign real estate for most is primarily an opportunity to spend a vacation surrounded by the closest family members, which often include pets, which not everyone wants…

...

Property for rent in Spain
Landlords and tenants are free to negotiate a lease. Typically, rental fees are paid monthly until the seventh of each month. The landlord has no right to demand payment more…

...