vdp
Jens Tolckmitt - VdP
According to Jens Tolckmitt, CEO of the vdp, “The situation in the housing markets of urban areas remains tense. Although construction activity has been stepped up, it is evident that the demand in those areas currently cannot be met."
Prices for German commercial and residential real estate continued to climb in the third quarter, according to the vdp Verband deutscher Pfandbriefbanken, the association of German Pfandbrief-issuing banks. The vdp property price index, which is based on actual transaction data, rose by 6.7% compared to the previous year.
The main drivers are still the low interest rate environment and relative dearth of alternative suitable investments, to which the vdp add also, "growing volatility in the economic environment making investment in real assets appear comparatively attractive."
Office buildings saw an increase of price of 8.3% year-on-year, and apartment buildings 7.1%, with owner-owned apartments (condominiums) rising 6%, with retail properties rising by 2.7%. This compares with the previous quarter, where the index for offices had increased 7.4%, just behind apartment buildings (+7.5%).
Currently, new lease contracts for office space have increased by 3.3%, for apartment buildings by 4.0%, and for retail space by 0.7%.
In the second quarter the vdp-Index was up by 6.3% on the previous year like-for-like, while the prices for condominiums had risen by 7.3%, and single- and two-family homes rose by 5.9%. Retail properties had risen by 2.6% in value over the year.
According to Jens Tolckmitt, CEO of the vdp, “The situation in the housing markets of urban areas remains tense. Although construction activity has been stepped up, it is evident that the demand in those areas currently cannot be met. What are needed are reliable, long-term framework conditions that make it possible to provide a needs-based supply. Important stimulus can come, not least, from policymakers.”
