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New terrifying study: Munich's real estate bubble is the world's greatest danger

2020-10-01T07:20:46.871Z

In Munich there is a buyer for every property, no matter how expensive. But what if Corona does burst the real estate bubble? A new study bodes badly.



In Munich there is a buyer for every property, no matter how expensive.

But what if Corona does burst the real estate bubble?

A new study bodes badly.

  • Many people in Munich

    suffer from

    high property prices

    .

  • In the past few years the price spiral has risen continuously.

    When is the end reached?

  • A

    study

    does not bode well - anyone

    buying an apartment or house

    now

    should be aware of the danger.

Munich - It

is well known

that Munich * has far

too high real estate prices

.

After all, it is usually said: An investment is worthwhile in the long term.

A current study is now unsettling: According to the assessment of the major bank UBS, the state capital is

even ahead worldwide in terms of

the risk of a

property bubble

.

According to the study, the real estate market in Munich most overrated - when will the bubble burst?

As in 2019, Munich is showing the

clearest signs of overheating

among the metropolises examined

, the financial institution said.

The market is

most overvalued here

.

UBS defines a real estate bubble as a strong, persistent discrepancy between the price level and data such as income, economic growth and population migration.

The number of years that a 60 square meter apartment close to the center has to be rented here in order to reach the purchase price is currently 39 - a record.

In Munich, the

strong economy

and

population growth

continued to fuel the markets, while

too little new living space was being

created.

In the Global Real Estate Bubble Index 2020 for Munich, the bank calculated a value of 2.35 - with more than 1.5 there is a bubble risk.

This puts Munich ahead of world cities like Paris and London (see table).

According to the study, the corona crisis * will be used to test whether the high prices are justified.

The stability of the real estate markets despite the

Sars-CoV-2 pandemic

can also be

explained

by government

aid

, which

saved

many people from a

loss of income

.

Living in Munich: how long will demand exceed supply?

But what does that mean for the people of Munich?

Maximilian Kunkel, chief investment strategist for UBS in Germany, warns: “Especially investors who are considering buying for profit reasons should exercise caution.

Also because the current real estate prices do not yet reflect the long-term consequences of the pandemic. ”Real estate expert Rudolf Stürzer, whose association Haus und Grund Munich looks after 420,000 properties in the greater area, sees no reason to worry.

Munich still has a

special status

.

"The demand continues to clearly exceed the supply - we expect 250,000 to 300,000 new residents in the next 15 years."

+

Incredible but true: These statistics show that Munich has the worst price-performance ratio in the world.

© FKN / Source: UBS

Even if the purchasing power should occasionally decrease due to Corona, there would still be enough queues to pay the high prices.

There is also another

effect of the corona pandemic

: “The importance of living has increased.

Gardens and balconies, for example, are even more popular.

And if the people of Munich save, then they are more likely to save on travel than on living. ”But he, too, admits:“ We cannot say what that will look like in the distant future. ”

Munich as a real “Monopoly”?

A billionaire is buying the next property - right in the heart of the city.

* tz.de is an offer from the Ippen Digital Network

Source: merkur

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