Real estate financing is benefiting from the relatively relaxed situation. Half of financing experts are reporting growth in new business. Lending volumes increased slightly. The European Central Bank (ECB) is keeping key interest rates stable.
The conditions for purchasing property have improved. Interest rates for property financing are stable, demand for residential property is developing positively and property prices are rising only moderately. An increase in transactions is expected in the medium term.
"I see the fact that banks are once again providing large-volume financing as proof that they have their refinancing under control and can therefore operate in this segment. This goes hand in hand with a stable market recovery, even if we are still a long way from a balanced financing market," says Prof. Dr Steffen Sebastian, Chair of Real Estate Finance at IREBS.
The ECB has decided to leave key interest rates unchanged for the time being. For Marcel Fratzscher, President of the German Institute for Economic Research (DIW Berlin), this decision comes as no surprise, but it does carry risks. Economic uncertainties remain high. It is much more likely that inflation will fall too sharply in the next two years. A precautionary and protective interest rate cut would therefore have been justifiable at this point in time.
Prof. Dr Lena Dräger, Director of the Monetary Macroeconomics Research Group at the Kiel Institute for the World Economy, comments on the ECB's decision as follows: "At 2.1 per cent in August, the latest inflation data for the eurozone is slightly above the target, while core inflation is stagnating at 2.3 per cent." This means that inflation remains moderate and close to the inflation target. In view of robust domestic demand and stable labour markets, a further interest rate cut does not appear necessary at present.
For prospective property buyers, this means that with moderate property prices and stable financing conditions, the chances are currently good of finding a property that meets their needs and is affordable within a reasonable period of time.
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