Montag, 23. Juni 2008

Buying Berlin Property

The demand for buying property in Berlin is on the up, due to prices in other countries appearing to hit their limit, whilst they are still at an attractive limit within Germany. Large companies such as Goldman Sachs/Cyberus Morgan Stanley and the Puma Pension Fund are investing up to $1 billion each in properties in the German Capital.

Very little housing construction has taken place in the last 10 years, spelling out an expected housing price increase due to the eventual shortage. A bright future is being predicted for investors into Berlin, as house prices are expected to rise, with over half of the inhabitants under the age of 35, there will be a cultural shift towards those buying their own homes, and we should expect to see a increase in house prices in the near future.

There's been a lot of interest in Germany recently, led by major institutions and banks who can sniff a profit. The investment levels shown by these major investors buying Berlin property, will start to drive prices up, which keeps home ownership down, although the demand will still be there.

There are great opportunities to make short term capital gains, or long term financial yields when buying property in Berlin. When buying in Germany, both these options are available to investors, so it is worth considering which is more important to you.

The boom in construction in the early 1990's happened at the same time a large number of residents left Berlin but, more importantly, their spending power diminished, also coinciding with an increase in unemployment levels. The result was a drop in house prices in the city.

Between 1994 and 2004, new development prices dropped by 30%. Germany is the only country in Europe where prices dropped in this time period. Berlin now represents the most competitively priced investments in Europe.

A long period of economic stagnation has helped to open up some new opportunities in the German property market. The introduction into the Euro had a devastating effect on the German economy and the stock market, leading Germans to look at buying property as an alternative to buying shares. A new government and new policies have woken up the sleeping economy, offering different kinds of investments for the inhabitants and foreign investors.

Now is the time for the smaller overseas property investor to consider buying in Berlin's housing market. Research reveals compelling evidence that buying property in Berlin is the next big thing in European city investment.

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