Berlin, 4 October 2018 – The number of condominiums sold in Munich has declined slightly and is down to 9,950 (2016: 11,057), back in the 4-digit range. This implies a decrease by roughly ten percent. However, the dip in the number of transactions is not matched by the trend in revenues. Sales in 2017 added up to a total of 4,454 billion euros (2016: 4,668 billion euros), which translates into a slight decline in revenues by 4.58 percent. The setback is primarily attributable to a drop in the sales figures for newly constructed buildings. Specifically, the number of new-build residential units sold declined by about 27 percent to 3,000 (2016: 4,120). “Demand for condominiums remains strong in Bavaria, most notably so in Munich. However, the supply of new-build property simply fails to cover demand,” explains Jacopo Mingazzini, CEO of ACCENTRO Real Estate AG. This is the gist of the new 2018 ACCENTRO Homeownership Report that is based on the analysed data of property valuation committees for the 82 largest housing markets in Germany. These include the leading residential real estate markets in Bavaria.
Out of the altogether eight housing markets captured in Bavaria, the ones in Ingolstadt, Regensburg, Erlangen, Würzburg and Augsburg also registered fewer transactions. The drop in Regensburg actually equalled 25.78 percent. Fürth was the only city that experienced a substantial increase in trading (up 12.21 percent), while neighbouring Nuremberg registered only a modest growth of 0.51 percent.
A different picture presents itself when you look at the price trend. All Bavarian cities except Würzburg reported a growth in prices per sale. Ingolstadt and Fürth actually saw double-digit price hikes per sale with growth rates of 12.47 percent and 11.60 percent, respectively. Analogously, Augsburg suffered a decline in the number of transactions and total revenues but boasted an increase in revenue per sale by roughly nine percent. This contrasts with a slight decline by 1.80 percent in Würzburg. “The figures document the persistently strong interest in homeownership in all major Bavarian cities,” said Mingazzini, adding: “Supply is unable to keep up with demand.”
The average selling price in the state capital of Bavaria rose by around 6.03 percent year on year, climbing from 422,176 euros in 2016 to 447,638 euros in 2017. Condominium prices in Munich are roughly two-and-a-half times as high as the average among the major cities, with the Bavarian state capital taking the top spot in the ranking of priciest German cities. Similarly, its price growth by 6.03 percent clearly outpaced the 4.56 percent average across the 82 cities surveyed. This means that prices in Munich are 70 percent higher than those in Berlin. However, other German metropolises are gradually beginning to close the price gap to Munich. Condominium prices rose by 9.01 percent in Frankfurt, by 13.17 percent Hamburg and by 18.82 percent in Düsseldorf this year.
The—in some places rapid—decrease in the number of sales is most conspicuous in the new-build segment. The supply in new condominiums is drying up. “This is one of the main reasons for the brisk price trend in major Bavarian cities. It is now up to the body politic to lay the ground for more housing construction,” said Mingazzini. The number of new-build condominium sales declined by 47.63 percent in Regensburg, and by around 27 percent each in Munich and Würzburg. Dips of around 20 percent were reported from Erlangen, Ingolstadt and Augsburg. Fürth took exception to the trend with an increase of around 21 percent in the number of transactions.
This year’s edition marks the eleventh time that ACCENTRO Real Estate AG published its Homeownership Report. The analysis is based on residential property sales transacted in all of Germany’s 82 major cities during the reporting year of 2017. The fact that it has access to the actual data of the surveyor committees sets this report distinctly apart from similar publications that ten to be based on expert assessments or the evaluation of quotes.
Detailed findings of the ACCENTRO Homeownership Report on Germany’s “Big Seven” cities and the trends of the past ten years are also available online in the ACCENTRO database, and can be retrieved in selective drilldowns: Home Ownership Report
ACCENTRO Real Estate AG is a residential property investor and Germany’s market leader in housing privatisations. Its real estate portfolio consisted of around 5,200 units as of 31 December 2020. In addition to Berlin, regional focal points include East German cities and conurbations, as well as the Rhine-Ruhr metro region and Bavaria. The business activity of ACCENTRO comprises four core divisions. These are the tenant-sensitive retailing of condominiums to owner-occupiers and private buy-to-let investors, the sale of real estate portfolios to institutional investors, the set-up and management of a proprietary real estate portfolio, and third-party condominium marketing for property asset holders, investors and developers. The shares of ACCENTRO Real Estate AG are listed on the Prime Standard segment of the Frankfurt Stock Exchange (German securities code number WKN: A0KFKB, ISIN: DE000A0KFKB3). investors.accentro.de
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