Innovation for the real estate industry

Research: Engel & Volkers Commercial presents the Immo-Navi WGH
Residential Investment property navigator increases market transparency

Hamburg, 4 October 2010. With the property navigator for residential investments, Immo-Navi WGH , Engel & Volkers Commercial presents an innovation to the real estate industry at the EXPO REAL 2010. Immo-Navi WGH for the first time provides information about the current regional market situation and the nationwide purchase price development for residential investments in Germany. The successful development of the Immo-Navi is evidence of our competence and know-how as market leader in the residential investment segment, says Richard Winter, Managing Director of Engel & Volkers Commercial GmbH.

Increase in market transparency

The real estate navigator for residential investments provides a model-like graphic illustration of the relative changes of purchase prices in the residential investment segment. The focus is on the investment preferences of real estate investors in good and average locations where most transactions are currently taking place. The pooling and evaluation of a number of regional, property-specific individual pieces of information is a reliable basis from which to increase market transparency in the long term , emphasises Carsten Rieckhoff, Head of Research at Engel & Volkers Commercial. Updating of market data will in future take place biannually and be available as a first aid to orientation for owners and prospective buyers.

Attractive long-term return opportunities

Germany counts as one of the most interesting investment markets for residential and commercial property in Europe. A residential investment may be comprised of only let apartments (apartment buildings) or a small proportion of commercial spaces e.g. practices, chambers, retail and catering companies. It is also typical for these properties to have only one owner (individuals, heir or owner communities). Residential and commercial properties are also synonymously described as apartment buildings or investment properties. These properties offer substance, inflation protection and denote lower return fluctuations than shares and other types of investment. Particularly metropolitan areas and major cities with a healthy economy and high purchasing power are attractive for long-term investments. With profound market knowledge in more than 30 locations in Germany and an annual number of transactions of several hundred properties have enabled Engel & Volkers Commercial to become the leading broker of investment properties in this investment category in Germany.

Phase: accelerated growth

Generally, phases of increasing prices are relieved by periods of declining prices. Accelerated growth, on the one hand, denotes a first time purchase price growth after thus far falling prices or after a drop in stagnating prices. On the other hand, the growth can also have strengthened. Many B-cities, but also economic centres such as Berlin, Cologne and also Dresden find themselves in this phase, as currently the average locations are also in greater demand there.

Phase: slowed growth

Development is less dynamic during slowed or weakened purchase price growth. Typical examples for this development are Hamburg and Munich which have left the period of accelerated growth. There might be no falling prices in sight in the next few months, but for many investors the duplicates (100 divided by return) are only just reached their sensible economic maximum. Potential for an increase in the purchase prices require the recovery of future rent increases.

Phase: accelerated drop

Price drops can also be differentiated between accelerated and weakened. The price drops in the accelerated area in this case denote the first drop after a time of price increases or a strengthening drop.

According to our research no such development can be seen in any of the considered cities, explains Carsten Rieckhoff.

Phase: slowed drop

The phase of weakening denotes a period of smaller drop rates until bottoming out. Smaller locations such as Wuppertal, for example, which experienced a to date uncommon price boom for the city in 2006 and 2007, are still in the consolidation phase, but are showing signs of bottoming out.

Germany trend

The Germany trend represented by the hand is the weighted average of all price changes of the represented city.

It is important to note in the Immo-Navi WGH that the development of purchase prices can be very erratic in the cities and therefore does not follow a linear development, emphasises Rieckhoff in conclusion. Detailed information about the locations of Engel & Volkers Commercial can be found in the residential and commercial properties market reports on the website,, in the Commercial properties area under the heading Research.

For enquiries, please contact:

Holger Klapproth
Head of Commercial Communication
Stadthausbrücke 5
20355 Hamburg
Telephone: 040-36 13 13 90

ENGEL & VÖLKERS Commercial GmbH
Carsten Rieckhoff
Head of Research
Stadthausbrücke 5
20355 Hamburg
Telephone: 040-36 13 13 65

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