Diamona & Harnisch - Life's Finest Values
Menu
Blog | 17. August 2017

BERLIN HOLDS ITS OWN AS A TOP INVESTMENT DESTINATION FOR REAL ESTATE


 


 

Berlin is simply tops. Berliners have known this for ages – now they have it in black and white. For the second year running, the German capital heads the ranking of the most promising cities in Europe. As an international real estate investment destination, the City on the Spree has left the perennial favorite, London, trailing in its wake. Ever since the British public voted to leave the European Union, the UK’s capital has been considered a risky candidate for professional investors and has now tumbled to 27th place (out of a total of 30). The latest ‘Emerging Trends in Real Estate Europe’ report, published by the consulting company PricewaterhouseCoopers (PwC), analyzes current and future trends in the real estate sector. According to the report, some 500 European real estate experts view Germany as a “safe haven.” Hamburg and Frankfurt are also among the safest investment destinations – ranking just behind Berlin in 2nd and 3rd place.

SPREE BEATS THAMES

The City on the Spree won over the experts in each of the four categories covered by the PwC survey. Berlin scored highly for offering the best investment prospects, project development opportunities, rental price growth and capital value appreciation. The city’s advantages include its low cost of living, affordable office rents, comparatively low apartment rents and good value property purchase prices. International companies also appreciate the fact that they can hire employees from all over the EU – thanks to the continent’s free movement of workers – an advantage that London will soon no longer be able to offer.

However, Brexit is not the only subject top managers in the European real estate sector are currently worried about: 89 per cent of investors also fear “international political instability.” Two-thirds of respondents expect the general political situation to worsen over the next three to five years. Only ten percent expect things to improvement. According to the study’s authors, this makes Germany – and especially Berlin – a “natural investment target.” And this won’t change, even if the Eurozone should break up completely.

Even today, the prospect of Brexit is redirecting the flow of investment capital from the British market to German cities (source: PwC). The latest study from the analysts at Scope has concluded that Berlin offers the best rental price growth forecast of the top 20 European office markets. Scope expects annual average growth of 4.4 percent through to 2021. This will be driven by the city’s extremely low office vacancy rate, which is just 2.5 percent (source: Angermann), combined with excess demand and the large number of office jobs that have been created in the capital. By comparison, Scope expects growth in London to average a meager 0.7 percent.

TOP FOR CONDOMINIUM SALES

The residential real estate market is also benefiting from Berlin’s economic and demographic dynamism. As the city grows, rental prices are surging, which makes acquiring residential property increasingly attractive. In 2015, for example, owner-occupied properties worth a combined EUR 5.28 billion were bought and sold – 39 percent higher than the previous year. This established Berlin as the nationwide leader, with the highest transaction volume of any German city. For detached and semi-detached houses, Berlin’s EUR 1.23 billion market meant the city climbed to second place, just behind Hamburg.

Archiv

 
Blog | 17. August 2017

BERLIN HOLDS ITS OWN AS A TOP INVESTMENT DESTINATION FOR REAL ESTATE


 


 

Berlin is simply tops. Berliners have known this for ages – now they have it in black and white. For the second year running, the German capital heads the ranking of the most promising cities in Europe. As an international real estate investment destination, the City on the Spree has left the perennial favorite, London, trailing in its wake. Ever since the British public voted to leave the European Union, the UK’s capital has been considered a risky candidate for professional investors and has now tumbled to 27th place (out of a total of 30). The latest ‘Emerging Trends in Real Estate Europe’ report, published by the consulting company PricewaterhouseCoopers (PwC), analyzes current and future trends in the real estate sector. According to the report, some 500 European real estate experts view Germany as a “safe haven.” Hamburg and Frankfurt are also among the safest investment destinations – ranking just behind Berlin in 2nd and 3rd place.

SPREE BEATS THAMES

The City on the Spree won over the experts in each of the four categories covered by the PwC survey. Berlin scored highly for offering the best investment prospects, project development opportunities, rental price growth and capital value appreciation. The city’s advantages include its low cost of living, affordable office rents, comparatively low apartment rents and good value property purchase prices. International companies also appreciate the fact that they can hire employees from all over the EU – thanks to the continent’s free movement of workers – an advantage that London will soon no longer be able to offer.

However, Brexit is not the only subject top managers in the European real estate sector are currently worried about: 89 per cent of investors also fear “international political instability.” Two-thirds of respondents expect the general political situation to worsen over the next three to five years. Only ten percent expect things to improvement. According to the study’s authors, this makes Germany – and especially Berlin – a “natural investment target.” And this won’t change, even if the Eurozone should break up completely.

Even today, the prospect of Brexit is redirecting the flow of investment capital from the British market to German cities (source: PwC). The latest study from the analysts at Scope has concluded that Berlin offers the best rental price growth forecast of the top 20 European office markets. Scope expects annual average growth of 4.4 percent through to 2021. This will be driven by the city’s extremely low office vacancy rate, which is just 2.5 percent (source: Angermann), combined with excess demand and the large number of office jobs that have been created in the capital. By comparison, Scope expects growth in London to average a meager 0.7 percent.

TOP FOR CONDOMINIUM SALES

The residential real estate market is also benefiting from Berlin’s economic and demographic dynamism. As the city grows, rental prices are surging, which makes acquiring residential property increasingly attractive. In 2015, for example, owner-occupied properties worth a combined EUR 5.28 billion were bought and sold – 39 percent higher than the previous year. This established Berlin as the nationwide leader, with the highest transaction volume of any German city. For detached and semi-detached houses, Berlin’s EUR 1.23 billion market meant the city climbed to second place, just behind Hamburg.

Archiv

 

© 2017 D & H Projektmanagement GmbH | Voßstr. 23 | 10117 Berlin | T. +49(0)30. 89 38 46 0 | info@diamona-harnisch.com | Monday – Friday: 09:00 am – 18:00 pm
ImpressumHaftungsausschluss | Datenschutz

Instagram

© 2018 Diamona & Harnisch Development GmbH
Voßstr. 23 | 10117 Berlin | T. 030 89 38 46 0 | info@diamona-harnisch.com

Imprint & Disclaimer