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#Despite Covid 19, real estate prices will rise by 3.6% in 2020/2021

The German real estate market is shining with growing numbers. Despite the Corona crisis, the market is growing by + 3.6%. Real estate is becoming more and more expensive, but rental income is too low. Are the top 7 cities like Hamburg, Berlin, Munich, Stuttgart, Düsseldorf, Frankfurt a.M. and Cologne threatened by a real estate bubble soon? According to the Empirica Index, the danger of bubbles will increase in the fourth quarter of 2020, of 401 districts in Germany, 324 districts are in a moderate to high Empirica bubble index. Without a continuous rent adjustment, we are headed towards a real estate bubble. Significant price drops are expected for 2021, now it remains to be seen how the market will continue to move with Covid 19.

#Short report KI - Kreth Immobilien. Media 2021


# Hamburg gets a new district on Grasbrook

Grasbrook on the south side of the Elbe is to be built from 3 quarters, Moldauhafen and Freihafenquartier,

right next to Hafencity a new district will emerge from the old hall area. The architects are certain, the same ones who designed the Elbphilharmonie. This will create a mixed-use innovation district in the next 20 years, combining living and working. 3,000 apartments (of which 30% are publicly funded) and 16,000 jobs are to be created here with a good, social infrastructure.

Startupper should also be provided ...

Innovative companies can use the area for research and development. The area in the Hafentorquartier should primarily serve as low-emission and port-economic use.

# Short report media KI - Kreth Immobilien 2020


#Who will pay the brokerage commission / agency commission from 2021?

The new law has been passed since June 2020 and is to be implemented nationwide, initially it will come into force in the next 6 months, at the latest from 2021.

Which federal states are affected by the new law?

1.Berlin 2.Hamburg 3.Brandenburg 4.Hessen and 5.Bremen.

What exactly is changing? A clear regulation .....

Anyone who previously commissioned the broker pays the commission.

Now a 50 to 50 rule applies, 50% of the seller pays a commission and 50% of the potential buyers.

Which properties are affected by the new law?

Legal private individuals who want to / will sell YOUR private property / or their property through a real estate agent.

Brief report KI - Kreth real estate Media 2020


# How is the german investment real estate market moving through the CORONA crisis?

Fortunately, the property market has so far remained stable. There were no major impairments, especially on the housing market. Real estate prices continue to rise, just as the experts predicted for 2020.

The corona crisis has also not changed much on the German real estate market, only the time factor of the transaction has been somewhat more hesitant so far, but that was solely because the market was somewhat frozen and germany was put into a sleeping beauty for a few weeks, which is now gradually stabilized again optimally. Due to the Corona crisis, residential complexes and retail properties are currently in great demand.

It remains to be seen in the next few weeks whether the market for office properties and hotels will change or whether investment transactions in this sector will continue without major damage.

Brief report KI - Kreth real estate Media 2020


# Real estate prices will continue to rise on the German market in 2020

Real estate prices have risen continuously in the past 7 years. The property price index peaked in the residential property sector at the end of 2019. And prices on the German real estate market continue to rise, already in the fourth quarter of 2019 the market rose by 6.3%.

The market for commercial real estate was very similar in 2019, with commercial real estate increasing by 6.0%, particularly in the last quarter of 2019. In the office real estate sector, by as much as 8.9%. Retail properties, on the other hand, lost 0.2%.

Summary report KI - Kreth real estate. Media 2020


# A hire-purchase model for low-income families - the state makes it possible for you!

# After the state reintroduced construction-related child support in January 2018, the state is planning something new for you. * You can find information on this in another article on this page.

No kidding, you could soon afford a condominium. How should that work ask yourself? Who will be considered in this model? Families under 40 years and with children. Example of financing: 212,000.- € uro for a 100m² apartment.

version 1

2 adults + 2 children, duration 24 years, monthly rate 933.- € uro.

or variant 2

2 adults + 2 or 3 children at a monthly rate of € 756.- over a period of 33 years.

The state would be the builder for you and the apartment would buy you as a hire purchase through regular installments from him over 24 or 33 years term. Who is the project for? For families under 40 who have no significant equity. So you would become the property owner over the years as a tenant.

Why does the state do it for you, you ask yourself? Currently, there is still an acute lack of housing, which the state wants to cover in the long term with this project model.

* For information, see: State-subsidized rental space.

Summary report KI - Kreth real estate. Medien 2019


# Germany still has an acute housing shortage.

According to the current study, far too few new buildings / apartments are being created, especially in the 8 major cities in Germany. Thus, this results in a study, e.g. in Cologne since 2016 not even 46% of the needs are covered. In Stuttgart, only 56% of the housing requirement has so far been met, with only Munich with 67%, Berlin with 73% and Frankfurt / Main with 78% being able to cover the demand somewhat.

Even in the Unistads there is still an immense need for housing, unfortunately, the influx of students was hardly considered.

Strict regulations in the construction industry, shortage of labor at the building authority and the lack of qualified craftsmen ensure that the construction industry hardly comes behind to catch up and meet the required housing needs in the cities.

Summary report KI - Kreth real estate. Media 2019


# Hamburg # Social housing is raised

Hamburg will approve even more social housing in 2019 as before.

HH is a federal state that puts its priorities on affordable housing. The Alliance for Housing writes program. This means that even low-income tenants can afford housing in HH.

For builders, there are various funding programs, these have been increased by 2%. Rental space can be created here which will be between 6.60.- and 8.70.- € uro per m².

From 2011 onwards, more than 20,000 apartments have been subsidized by the Senate.

The total number in 2019 should amount to 79,000 dwellings and increase to 84,000 by the year 2026. For future tenants, this creates better opportunities to rent affordable housing.

Summary report. KI - Kreth real estate. Media 2019


# Baukindergeld 2018 was introduced.

Around 50,000 families have so far only applied for the newly introduced Baukindergeld.

How does the new concept work? The state provides around 3 billion € uros annually.

Who can apply for a Baukindergeld? Families with children who want to buy a condominium or a house or build their own house. Around 1,200.- € uro can apply for a family with one child per year and receive over a total period of 10 calendar years, making a total of a subsidy of 12,000 € uro per child.

The income limits for single parents and families have been set at € 90,000. For larger families, the standard rate may exceed 15,000 € uro.

Who can apply for this grant? Single parents and families with children who have been granted planning permission from January 2018 or have signed a purchase contract for an ETW or a house from January 2018 can also apply for a subsidy retrospectively.

Start of the sponsorship of the Baukindergeld has been January 2018.

* You can find information about this under: Applying for construction child allowance.

Summary report.KI - Kreth real estate. Media 2019


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