More compromises when buying real estate

The drastic events - pandemic, war, inflation and energy crisis - of recent years have left clear traces on the real estate market. The preferences of prospective buyers and renters have changed. The most important criterion in the search for real estate is now the price and no longer the location.

The online survey of a broker network showed that the location of a property was the most important decision criterion for 65.6 percent of respondents during the pandemic. Since the beginning of the Ukraine war, this has changed: Now the purchase price is most important for 61.8 percent of respondents.

While before the pandemic most prospective buyers were looking for properties in the city (54.7 percent), since the pandemic the surrounding area has become the most sought-after region for property searches (55.7 percent). The demand for home ownership in the countryside was only 6.6 percent before the pandemic; during the pandemic, interest increased to 17.9 percent, and currently the figure is 15.1 percent

The main reasons for the shifts in the real estate market are the sharp rise in interest rates and the high cost of living and energy due to inflation. This has recently resulted in a certain reluctance to buy real estate. Many are hesitating, weighing up and having to recalculate. Nevertheless, the desire to own four walls remains unbroken.

Many prospective real estate buyers are now prepared to make compromises and cutbacks. However, the willingness to compromise does not only affect those willing to buy who cannot make big leaps under the new conditions, but also those selling. Anyone who wants to sell a property now has to adapt to the new conditions - in terms of proceeds.

The survey results are confirmed by an analysis of the IVD. "The new reality on the real estate market in Germany's BIG 7 is characterized by a larger supply of properties and longer marketing times," reports Prof. Stephan Kippes, head of the IVD market research institute. Year-on-year, the supply of real estate in January 2023 increased by an average of 33 percent in the seven largest cities. Buyers are encountering a considerably larger supply and have the chance to acquire properties "that were still out of reach in 2021".

(Photo: © Gerd Altmann, Pixabay)