Impact of the US subprime crisis on the German housing market

2008

A US-style subprimesegment in Germany is apparent only to a very limited extent. Having said that, there is still no sign of an end to the US subprimecrisis which has by now turned into a credit crisis with potential effect on the German market.Investors are therefore advised to act cautiously. The IMF puts global losses from this crisis at more than EUR 603 billion. Right now, it is especially difficult to assess the psychological impact on the purchasing behavior of private and institutional investors.Despite the subprimecrisis, the prospects remain bright overall for investors on the German housing market. To seize the opportunities available, however, institutional investors must pay attention to crucial success factors such as regional peculiarities. For private market players, housing in large cities in particular remains an attractive investment opportunity with stable value growth and the prospect of a continued rise in property prices.