The forecasts that real estate purchases would decline due to Corona have been refuted: credit institutions have recorded more commitments on real estate loans than in the record year of 2019.
With the onset of the Corona crisis, there was much speculation about its impact on the real estate market. Among other things, it was suspected that potential buyers are holding back for the time being and want to wait for the development of the economy and their own financial situation. However, it is now becoming apparent that, at least for the time being, investing in real estate has not been waived.
Survey confirms: Almost all major credit institutions gave more loans
The WirtschaftsWoche surveyed credit institutions on the demand for real estate loans in Germany – according to the WirtschaftsWoche, the result of the survey shows that almost all institutions granted more loans than in the record year of 2019: According to their own information, the Volks- und Raiffeisenbanks recorded the highest in the first quarter of 2020 Lending growth since 2000. Even in March of this year, the month in which Germany introduced the first restrictions on public life due to the corona virus, lending was 6.2 percent above the previous year’s level and 7.6 percent more real estate loans were granted. And a spokeswoman told WirtschaftsWoche: “The main driver of strong credit demand is still housing loans to non-banks.”
In addition to the Volks- und Raiffeisenbanken, only the savings banks are open about the available figures: They told the Süddeutsche Zeitung that in the lockdown month of April 2020 new loans worth 5.5 billion euros were granted, which is 12.1 percent are more than in the same month last year. In addition, loans worth 21.3 billion euros have been committed since the beginning of the year.
However, many of these loans were negotiated before Corona
The other credit institutions participating in the survey did not express themselves in numbers, but nevertheless expressed themselves very clearly. ING apparently speaks of “a large number of home finance deals” – both overall and compared to the previous year. Likewise, new business also increased significantly at Deutsche Bank, Postbank, BHW Bausparkasse and DSL Bank in April, with Allianz reporting a consistently positive development in mortgage lending.
While the results of the survey are surprisingly positive, it should not be forgotten that a large part of the loans were negotiated before the crisis, which could otherwise have caused hesitant property buyers to buy despite the crisis. With lockdown and contact restrictions, however, the number of advertisements on real estate platforms decreased – therefore, fewer real estate loans may be taken out in the second quarter of 2020.
Continued great interest in construction loans
This is contradicted by a statement by Jörg Utrechts, the CEO of the interhyp Group: He continues to believe that interest in construction loans is very high – in an interview with capital.de, he also speaks of the extremely low construction interest rates, which make it possible for some people to agree on one To be able to provide credit at all. The all-time low interest rate leads to interest rates of less than 0.7 percent of the loan amount for many banks. In addition, real estate is a popular asset, especially in times of a weak economy.
The global real estate market remains attractive. grundbesitz global invests worldwide in commercial real estate from the areas of office, logistics and retail. Why this is interesting for private investors.
Utrecht’s assessment is supported by Sparkasse President Helmut Schleweis, the Süddeutsche Zeitung quotes him with the words: “The demand for residential real estate continues to be very stable and may continue to rise.”
Image sources: Natee Meepian / Shutterstock.com