Real estate bubble – The big topic in Spiegel this week. What happens when the real estate bubble bursts? The cycle leading to the real estate bubble is quickly explained: If interest rates rise again soon, theoretically fewer people will be able to afford new financing and loans for new construction or their own home. Therefore, with low interest rates, more and more people will want to invest money in alternative ways. This ensures that other forms of investment become more attractive, so less money is flowing into the market for real estate and in the long term demand will fall, which in turn will lead to falling prices. Especially in the mirror this week is about renewed speculation around another bubble in the real estate market (read more: Emergence of a real estate bubble). All real estate news can be found right here: Real Estate News.
What is a real estate bubble?
What is a real estate bubble? Many who hear the word real estate bubble first wonder what the term is all about. A real estate bubble is a form of a speculative bubble. The term real estate bubble states that real estate is being sold at overpriced prices and is generally overvalued. The higher these prices get, the bigger the real estate bubble gets until it finally bursts after reaching its peak. Once it bursts, prices fall abruptly.
The Spiegel reports this week that economists currently see increased alarm signals in the current speculation on the real estate market. Therefore, economists classify the bubble risk at 92 percent. Further, the mirror sees an overheating in the real estate market: For these cities and counties experts warn of a bubble. It becomes critical under circumstances for real estate owners. As described in the WDR: “Who would have to sell his object, in order to come at money at present, obtains only lower prices, says Voigtländer. The financing model set up together with a bank could then waver. But those who keep their property in the medium or long term do not feel any direct effects.”
Where are property prices rising the most?
The price trend is currently strongest in the south of Germany. Bavaria, Baden-Württemberg but also neighboring states such as Hesse and Rhineland-Palatinate have to contend with rising prices per square meter. What annoys the buyer of houses and condominiums, is for house sellers of course an absolute blessing, because currently top prices can be achieved, as you can see here in the statistical analysis:
You can find more infographics at Statista
Is it still worth investing in real estate?
Admittedly, the current real estate market is in motion and heated up. Real estate prices per square meter have been rising for some time. What is and remains certain is that real estate is still one of the few investment properties that currently still yield sufficiently attractive returns for investors. Tip: Here you can find all current prices of the most important real estate companies. Despite the current and long pending discussion about a real estate bubble, the investment does not seem completely absurd. Learn more here: Real estate as an investment.
Interview: “The real estate bubble will burst”.
Prof.Max Otte in an interview with SWR with the statement: “The real estate bubble will burst”. The topic: “The Great Money Flood – How the Rich Are Getting Richer”.
Tip! New at Lukinski: Sell Hotel
Profit from the current tourism boom and sell your old hotel at a good selling price. More tips? Read here: Selling a hotel.
— IhrHausverkauf.de (@ihrhausverkauf) August 10, 2019
Real Estate News
IM Real Estate Manager on healthcare real estate
This week at IM Immobilienmanager, among others, articles on “Healthcare real estate: hardly any big deals” and “Eden Tower: €110 million financing in place”. More news can be found here:
- Europe’s logistics rents rise sharply
- Eden Tower: 110 million euro financing in place
- Healthcare real estate: Hardly any big deals
Frankfurter Allgemeine on health: How to work in the garden without back pain
This week’s Frankfurter Allgemeine features exciting articles such as “Garden design: June’s flowering treasure chest” and “The right way to rake and mow: Gardening without back pain”. More news from the past days:
- Garden design: June’s flowering treasure chest
- Holiday architecture: How to attract guests with special holiday properties
- Rake and mow properly: How to do gardening without back pain
Real Estate Newspaper on political interventions in the granting of loans
This week Immobilien Zeitung has interesting topics such as “Outlet centers will double turnover in Germany” and “In Münster, especially medium residential areas will become more expensive” in the magazine. The posts and more tips can be found here:
- Outlet centers will double sales in Germany
- DIW calls for political intervention in lending
- In Münster, it is mainly medium-range residential areas that are becoming more expensive
Spiegel on speculation in the real estate market
At Spiegel, this week’s topics are “Overheating in the real estate market: experts warn of a bubble for these cities and counties” and “Real estate: bank offers construction loan without interest in Denmark” . More news from this week:
- Real estate: Bank offers construction loan without interest in Denmark
- Speculation on the real estate market: Economists rate bubble risk at 92 percent
- Overheating on the real estate market: Experts warn of a bubble for these cities and districts
Handelsblatt on Mexico City: Paradise for apartment renters
In contrast, Handelsblatt reports this week on “Vonovia increases profit by 13 percent thanks to acquisitions and higher rental income” and “Low interest rates aren’t everything: These are the best providers for construction loans” . More headlines of the week:
- Low interest rates are not everything: These are the best providers of building loans
- Why Mexico City is a paradise for apartment renters
- Vonovia increases profit by 13 percent thanks to acquisitions and higher rental income
Star to new concepts: The kit house
Stern’s blog looks at “London: tenant fined €112,000 for renting out his council flat via Airbnb” and “House building: put up this dream kit house yourself” . More news of the week:
- House building: This dreamlike kit house you put up yourself
- London: Tenant must pay €112,000 fine for renting out his council flat via Airbnb
- Real estates: Family plans with 84,000 euro building child money – and is to go out now empty-handedly
Haufe with money laundering in focus and suspicious leases
New from Haufe this week includes “Housing construction: Vorpommern demands concrete help from state and federal government” and “Money laundering: real estate agents must report suspicious rental contracts” . More real estate news for tenants, buyers and sellers:
- Housing construction: Vorpommern demands concrete help from state and federal government
- Cabinet approves draft law against share deals
- Money laundering: estate agents must report suspicious leases
Manager Magazin on HQ Capital: Gambled away in New York
There are also new headlines this week from Manager Magazin such as “Extreme interest rate development: Danes get long-term loans at zero rates for the first time” as well as “Adenauer vs. Quandt: HQ Capital gambles away in New York” . More headlines:
- Adenauer vs. Quandt: HQ Capital gambles away in New York
- Extreme interest rate development: Danes receive long-term loans at zero rates for the first time
- Hotel icon Raffles Singapore reopened: A room? Here there are only suites
T-Online on deadlines in house building
This week, T-Online has covered topics such as “Warranty when building a house – no builder should miss this deadline” and “Rent arrears – rent not paid: When may the landlord terminate?” . New topics of the week:
- Protection for times of crisis – stumbling blocks for couples in real estate financing
- Rent arrears – rent not paid: When may the landlord terminate the lease?
- Warranty when building a house – no builder should miss this deadline
Süddeutsche Zeitung with landlord interview
This week’s Süddeutsche Zeitung blog is about “We are practically fully let” and “Database instead of gut feeling” . Updates and news from the newspaper:
Federal Gazette on land transfer tax reform threatening businesses
This week at Bundesanzeiger among others “Year of construction must be correct” but also “First yes, then no” . New articles, headlines and trends:
- First yes, then no
- Year of manufacture must be correct
- Real estate transfer tax reform may threaten companies: Federal Cabinet approves unsuccessful reform
Berlin.de about Tegel after-use
New articles and posts from Berlin.de this week include “Homeowners must build reserves for maintenance” and “More building applications for apartments due to extensions and conversions” . More headlines of the week:
- Homeowners must set aside reserves for maintenance
- Senate pushes ahead with plans for Tegel’s subsequent use
- More building applications for apartments due to extensions and conversions