Every year, the Council of Real Estate Experts prepares the spring report for the real estate industry. In it, the state and future as well as the development of the sub-segments of the real estate market are highlighted: Residential and commercial real estate, hotel, office and logistics as well as corporate and hotel real estate.
The latest report, which has just been published, sees threats to the retail and hotel sectors, while the residential sector, especially demand for larger apartments, continues to grow.
Rents for existing apartments continued to rise in 2021, reaching an average of 8.46 euro per square meter per month. At plus 3.7 percent, the increase was similarly dynamic to the previous year. Purchase prices for owner-occupied apartments continued to accelerate their rise in 2021. On average across Germany, they rose by 14.3 percent compared with 2020 to 3,140 euro per square meter per month. An abridged version of the report can be found at: www.zia-deutschland.de/wp-content/uploads/2022/02/Fruhjahrsgutachten-2022-kurz.pdf.
The retail sector and the associated real estate companies are facing a future of great uncertainty. Insolvencies, store closures and layoffs are impacting downtowns. Sustainable downtowns need new mobility concepts and a diverse mix of uses including housing, education, culture, crafts, small businesses and communications.
The construction industry continues to be a reliable pillar of the sector, although it has not provided any additional impetus. The shortage of materials in the sector is expected to be overcome in the course of 2022, so that construction activity can now continue to develop dynamically, especially in residential construction.
In new residential construction, the number of completions in 2020 exceeded the 300,000 threshold for the first time in 20 years at 306,000 homes. New construction is also likely to continue to rise in the coming years. However, the target of 400,000 new homes per year is unlikely to be achievable in this legislative period.
(Photo: © Gerd Altmann, Pixabay)
