Real estate - still a worthwhile investment
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A current study by the analysis institute bulwingesa provides information on where investments are still worthwhile today. It states that achieving secure returns has become even more challenging. The current "5% Study" deals with the yield potential of the German real estate markets.
The risk and yield spreads for office properties in A-cities have widened considerably. The most significant decline was in A-cities, while B-cities remained fairly constant. Although risks are increasing, purchase prices are still high. Finding suitable properties is difficult. Many investors are uncertain how home office will affect the future demand for office space. From a legal point of view, home office is not yet mature enough to replace office work.
The investment market for shopping centres is idle. Only a few are currently being traded, the demand situation is difficult. Buyers often have to factor in high investments for conversions. Investors are uncertain about the extent of future rent adjustments or the closure of shops. Food-oriented retail space remains a sought-after investment. Retail parks with a high proportion of periodic needs remain in demand.
Flats are a safe bet. Here, there has been the least change compared to the previous year. According to the bulwiengesa forecast, purchase prices will grow less than in previous years until 2024. Despite more short-time work and higher unemployment, housing demand is good. There is still a low supply in many cities. The achievable yields remain at a low level. Market risks remain manageable - housing continues to be a very safe asset class.
(Photo: © Jörg Hertle, Pixabay)