Interview with a Finance Specialist
This month we are delighted to interview Martin, a mortgage broker that we work with in Germany:
Hi Martin, many thanks for agreeing to do this interview. To start us off, can you please give us a quick introduction to yourself and your history.
Hi James, it is a pleasure for me, I am almost 47 years old, two children, I live in Berlin-Köpenick where I can directly feel the pulse of Germany’s fascinating capital but at the same time enjoy its large forests and waters. From 1988 until 1992 I studied business administration at Mannheim University, and finished with a diploma. Thereafter I worked for the financial department of a big company before I became a financial advisor in 1999. Since then I have been working as an investment consultant and mortgage broker. In 2005 I started to focus on arranging for mortgages for foreign investors.
Since ProVenture Property have operating in Germany, we have noticed willingness to lend has decreased. Can you please provide a bit of background on how you have seen banks’ willingness to lend change in the last few years.
The boom of lending money to foreign investors was steadily increasing when I started my activities. The peak was in 2007. After the default of Lehmann Bros. in 2008 the willingness of banks to provide reasonable mortgage dropped immediately and sharply. It then recovered slowly to kind of a pre-Lehmann level. As property prices, however, have developed much faster than rents, the LTVs banks offer have slightly declined in areas where yields have dropped significantly.
How does the financing process in Germany function in general for foreign investors?
…to read the full interview, with Martin’s views on current LTVs and what foreign investors can do to get better access to finance – read on here…
Snapshot of the German Economy and the Property Market – March 2013
The month has broadly better news for the German economy, after the Eurozone uncertainties of 2012 Q4. German unemployment fell in February amid signs that the economy is returning to growth after a pull back at the end of last year.
The number of people out of work fell to 2.92 million, the Nuremberg-based Federal Labour Agency said today. The rate remains at post-unification lows, at around 5.9%.
Equally encouraging was to see Inflation continue under control – according to Office of Statistics the inflation rate is now 1.5% and trending downwards over the last 2 years.
Continuing on the improving trend, consumer confidence up as measured by the Gfk index, now at a 12 month high. In line with this trend the business confidence, as also higher according to Ifo, up dramatically in Feb 13 and back in “boom” territory when looked at in terms of the “business clock” which positions the economy in recession-downswing-upswing-boom categories.
The business outlook according to Ifo actually his a post-reunification high, signally a strong recovery in the Germany economy is really underway now.
And in the Property Markets…read on…
German Property Management
This is a huge topic, one which I am still learning after 5 years in the market as an investor in both single apartments and also of apartment blocks across different regions of Germany. There are some huge differences in the way property is managed, certainly to my domestic market of the UK, mainly commensurate with the higher level of renters in the sector and longer residence times. Find out the challenges and advantages with German Property Management here
Positioning In the German Property Market in 2013
Within the context of the wider European property market, Germany looks well set to continue to enjoy much stronger growth than its neighbours whilst enjoying still historic low interest rates.
Looking at the economic cycle and property price histories in Germany, it can be asserted that the country is in the early to mid cycle of growth. This short article will look to the different factors affecting taking a position in the market in 2013, and some ideas to the next 5 years of growth.
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With 10 apartments, 1 commercial and 4 garages, this 2012 / 2013 fully renovated and refurbished multi family home is situated in the district of Wulsdorf. Beginning in 2012 the house has been completely renovated. The works will be finished approx April 2013.
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