Investors focus on German residential real estate
The German residential real estate market remains the focus of institutional investors - despite falling initial yields. This is the result of a survey of institutional investors in Germany conducted by Engel & Völkers Investment Consulting.
According to the survey, around 53 percent of respondents intend to further increase the share of residential real estate in their overall real estate portfolio over the next twelve to 18 months. More than 60 percent of investors intend to invest up to EUR 100 million in residential real estate. At 35 percent each, residential real estate in A and B locations is in equal demand, and in C cities (under 100,000 inhabitants), 23 percent of the survey participants still want to invest.
The respondents see the highest potential for rent increases in German A locations. They anticipate an annual increase of 3.4 percent, 2.9 percent in B locations and 1.6 percent in C locations. With regard to the development of purchase prices for residential real estate, the experts predominantly expect prices in A and B locations to continue to rise (66 percent and 63 percent) or to remain stable (26 percent and 29 percent). In C-cities, 24 percent of respondents expect prices to rise, 47 percent believe that prices there will remain stable, and 19 percent even forecast falling purchase prices for residential real estate in C-cities.
Swiss institutional investors have also recently become more active on the German housing market. (ah)
