| inbluevt | Date: Monday, 2013/10/21, 6:12 PM | Message # 1 | DMCA |
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The Bundesbank has warned that apartment prices in Germany’s biggest cities could be
overvalued by as much as 20 per cent, stepping up its concern about a real estate boom in the powerhouse of the European economy.
The warning will feed into German concern that the European Central Bank’s monetary policy is far too loose for the country. The bank’s main refinancing rate is 0.5 per cent, a record low.
It also adds to signs that international investors are fuelling rising property prices around the world. The trend reflects the lack of opportunities investors regard as a safe haven and low returns for traditional asset classes such as bonds and stocks.
Rapid price rises have particularly affected the seven largest cities in Germany, the central bank said on Monday, although the value of houses had risen at a more moderate pace. Flats in Berlin, Munich, Hamburg, Cologne, Frankfurt, Stuttgart and Düsseldorf had, on average, seen prices rise
more than 25 per cent since 2010.
“After the real estate bubbles in the US and several European house markets burst, the German property market, which had been quiet for many years, became more attractive to international
investors,” the Bundesbank said in its monthly report for October.
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Message edited by inbluevt - Monday, 2013/10/21, 6:20 PM |
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