Real estate news

# Will we get a real estate bubble in Germany in 2023? 

The signs are there, but is the housing bubble actually coming? There is no general answer to this, all the details must be taken into account. The interest rate, the demand for real estate and the purchase price is decisive, in 2021 and 2022 real estate prices rose sharply and were even 30 - 40% above the usual market price, the key interest rate was already raised 4 times in 2022. The building interest was raised from 1% in January 2022 to 4% in March 2022, whoever decided to buy a property with financing in March had to calculate with a financing increase of 50%. So you paid a monthly with a 2% repayment. Deduction of 1,000 euros in October 2021 and a few months later 2,000 euros per month due to the increase in building interest rates for a loan amount of 400,000 euros / real estate financing. How does a real estate bubble form? In a nutshell: When real estate prices rise rapidly in the long term and even exceed the market value, demand increases sharply, financing rates remain low and then demand comes to a standstill, prices fall, this is exactly when a real estate bubble occurs.

#Short Report KI - Kreth Real Estate. Media 01/2023

# The year in review 2022 on the housing market 

The housing market kept us in suspense in 2022, permanent changes were constantly being reorganized. The new property tax has caused a lot of chaos, the energy crisis was a big issue and the Bundestag has massively shaken up the housing concepts, KFW funding and Co were big issues for the real estate industry. New incentives should be created for housing construction. Tax incentives for rental housing was a big issue to create affordable housing. Shortly before the end of the year on December 16, 2022, this law was passed by the Federal Council at short notice. 

#Short Report KI - Kreth Real Estate. Media 01/2023

# Living in the suburbs is the new trend 

Hardly anyone can afford the metropolises today and that is why the new living trend is in the suburbs, well-connected to the network, close to a big city and yet in the countryside, especially for families this is still an affordable and good alternative to be able to afford their own home . All residential areas within a radius of 50 km from the capital are referred to as the commuter belt. 

#Short Report KI - Kreth Real Estate. Media 01/2023

# More office vacancies expected in 2023 

Corona, inflation, home office, it was still a lucrative investment in office real estate in previous years, this will change in 2023 with strong fluctuations. In 2022, a top yield of 2.65% was expected. but the forecast for 2023 will look bleak, with high office vacancies expected. Big cities in particular will be affected, such as berlin, düsseldorf, munich, hamburg and frankfurt.

#Short Report KI - Kreth Real Estate. Media 01/2023

# The housing market is slowly 

Calming down In contrast to the previous year, apartment prices rose only slowly and less in 2022 by around 4.9%. As a result, owning your own home in big cities is also becoming difficult for private customers to afford. In order to be able to afford a home of your own today, families must have 5,000 euros net available per month. For new buildings, a longer waiting time must be taken into account because of the increased inflation and lack of building materials. 

#Short Report KI - Kreth Real Estate. Media 01/2023

# The real estate boom in 2022 continues steeply upwards

The real estate market for houses and condominiums continues to boom in 2022 and is simply unstoppable. The real estate prices are now already set up to 40% too high and write new record figures!
Private real estate and commercial real estate were traded in 2021 in Germany in the value of approx. 321 billion euros.

The transaction market with commercial real estates was 2021 with a market share of approx. 111 billion €uro thereby. In 2021, the market share was again 13.7 percentage points higher than in 2020.

The real estate boom is 2022 unstoppable.

#Short report KI - Kreth real estates. Media 02 /2022

# Inheritance Tax. With these tricks your inherited property remains tax-free

If you have inherited a property, you are obliged to provide information to the tax office. This must also be done within the first three months. If the value exceeds the exemption amount, you will be asked by the tax office to pay. This is because inheritance tax is now due and must be paid to the tax office.

But where are the limits?
Spouses can inherit up to 500.000.- €uro tax-free, children can inherit up to 400.000.- €uro from each parent and grandma and grandpa can bequeath up to 200.000.- €uro to their grandchildren. For brothers and sisters, cousins and the life partner a tax allowance of up to 20.000.- €uro applies.
The inventory / household / household goods is tax-free for spouses, children and grandchildren up to 41.000.- €uro.

When would the inherited property be tax free? When you will use the property yourself.
Spouses, partners and children can inherit a property tax-free if they live in it themselves.
As a clause applies: You must move into the inherited property within 6 months and may not sell the property / house or condominium with a maximum value of 200 m² of living space in the next 10 years.

What other option do you have with an inherited property? A donation!

The value of the property is higher than the maximum amount? Then you could also give away this property during your lifetime. What advantages would you have? In this case, the same tax allowances apply as listed above. In the case of a gift, the allowance applies to individuals for a term of 10 years. When making a gift, make sure that you are removed from the land register, otherwise you will remain the owner.
Translated with (free version)

#Short report KI - Kreth real estates. Media 02 /2022

# Now it goes greedy landlords to the collar, up to 100.000, - €uro at fines are to be expected

Landlords think since Corona they can make what they want and pull with all tricks the rents, now says the federation council STOPP and doubles the fine of 50.000.- €uro to 100.000.- €uro penalty.

For whom does this penalty apply? For landlords who do not adhere to certain limits and drive up your dumping rents. In the future, landlords must adhere to the fixed German rent index and may not exceed it by 20%. If this is the case, the landlord commits an administrative offense and must expect a fine of up to € 100,000.

The tenant federation welcomes this new regulation for the protection against a further tenant boom. Since the rents have already reached an almost unaffordable level anyway, this must finally be acted upon.

#Short report KI - Kreth real estates. Media 02 /2022

# Real estate investors have chosen these metropolises for your favorite place Top 20 ranking

A new condominium or house must be well considered, which metropolis is attractive for a prospective buyer? Worldwide, 63 attractive cities for a real estate investment were studied and you will be surprised how the top 20 distribution was listed.

Here the most popular top 20 places listed:

1 st place Stockholm, who would have thought that Sweden emerges as the test winner.
2sd place London, London has always been a popular location, but unfortunately hardly affordable.
3rd place Paris, the city of love

4th place Copenhagen, 5th place Amsterdam, 6th place New York, 7th place Munich, 8th place Zurich, 9th place Toronto, 10th place Sydney, 11th place Vienna, 12th place Berlin, 13th place Tokyo, 14th place San Francisco, 15th place Dublin, 16th place Melburn, 17th place Melburn, 18th place Washington. Rank 19 Geneva, place 20 Brussels.

#KI short report - Kreth real estate. Media 02 /2022

# From the summer of 2022, homeowners will have to submit a property tax return.

Starting next summer, home and property owners will be faced with something new, the so-called property tax return. Reform of the property tax. Your tax advisor and the tax office can provide you with more details and information.

Calculation: Real estate value X assessment rate X tax assessment number

Property value = Size of the property, age of the property, rental income, type of property and the standard land value are decisive.

Assessment rate = As property values have risen in recent months by approx. 12%, the assessment rate is to be adjusted. The real estate tax is to be determined value-stable. The assessment rate can fluctuate and be set between 300% and 900% depending on the region.

An example: A single-family house in Hamburg, built in 1950 with a living space of approx. 125 m² and a property size of 780 m² is subject to an assessment rate of approx. 480%. In order to be able to maintain revenues permanently and consistently, the assessment rate in this example would have to be adjusted to 421%

Taxpayer = Since 1935 the real estate value has risen continuously, since 2020 even by approx. 3.6% - 12.3%. In order to be able to promote social housing and cooperative housing in the future, a discount of 25% must be achieved. Therefore, the notional tax rate must be adjusted.

Calculation example:
Property value 300.000.- €uro x assessment rate 421% x tax rate 0,034 = 429,41.- €uro property tax

The property tax return is to be submitted between 01.07.2022 and 31.10.2022.

# Short report KI - Kreth real estate. Media 02 /2022

# For homeowners, the new federal government announces high costs

Property owners will have to dig deep into their pockets in the coming years. The new climate protection target set by the new federal government wants to be climate neutral by 2045.

What does that mean for property owners? Residential buildings with energy efficiency class G must be upgraded to at least class F by 2030. And consumption must drop from 250 kilowatt hours to at least 200 kilowatt hours.
In November 2021, the new law was concluded that oil heating systems may no longer be installed and, if they still exist, they must be replaced by alternatives.

The new climate protection goal is called Effiziens: Sanieren, Aufrüsten und Umrüsten.

#Short report KI - Kreth real estates. Media 02 /2022

# The price increase on the German real estate market booms in 2021

Still in the 3rd and 4th quarter of the old year 2021, the real estate prices for condominiums and houses have risen rapidly upwards. According to the Federal Statistical Office by about 12%. It was the biggest price increase in the 2000 series so far.

The real estate market has a strong impact on our financial system, the banks estimate the prices from 10% to 30% too high, here is an overvaluation of real estate prices. Which can also lead to financing problems for buyer groups.

# Short report KI - Kreth Real Estate. Media 02 / 2022

# NEWS 2022 ++ Despite Corona, another very good record year was achieved in 2021 ++ NEWS ++

The current record figures for 2021 have been announced.
The year 2021 has broken all rocords despite Covid 19. For about 111 billion €uros were traded on the German real estate market with investment properties. The new record year 2021 has exceeded the old record year of 2020 with about 40%. Foreign investors held a market share of about 32%.

Core investments were far ahead with a high market share of about 72%, followed by certified investment properties and forward deals. Forward deals held a market share of around €18.5 billion in 2021.

1st place = residential real estate = + 145%.
2nd place = Office real estate = + 11%.
3rd place = logistics real estate = + 34%.

The investment trend 2022 will continue to focus on residential real estate, residential and commercial buildings / retail and clearly on the logistics real estate sector in the top 20 cities.

# Short report KI - Kreth real estate. Medien 01 / 2022

# KFW funding stop?!

The existing KFW funding program is stopped. Current applications about 24,000 but are still processed for a climate-friendly housing & refurbish. A new program is for it however already set up EH 40 and is to run to end 2022 with a promotion sum of approx. 1 billion €uro. It applies to new buildings and reorganizations after the KFW 40 effezientes building program and with a reduced promotion program is set up.

Programs affected by the funding freeze are the Effizienshaus 55 affected, in the new construction sector EH / EG 55 and the new construction efficiency house EH / EG40 and the energy renovation sector.
The federal government's funding framework plans a sustainable building and renovation so the following money from funds have already been made available:
07 /2021 = about 5.8 billion €uro and 09/ 2021 = about 5.7 billion €uro - 11.5 billion €uro ( due to new additions) increased.

Targets need to be met for affordable housing.

#Short report - KI - Kreth real estate. Media 01 /2022

# 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. Media 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