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Source: Infographic WORLD
V or almost exactly ten years ago, there was the big bang. The price overruns on the US real estate market have resulted in bankruptcy of Lehman Brothers investment bank. The institute was heavily involved in financing and complex investments in real estate notes and had to declare bankruptcy in the summer of 2008.
The reason was a drop in prices in the US real estate market and subsequent credit losses. After the bankruptcy of Lehman followed the collapse of the international financial markets. In Germany, it is mainly public institutions such as HSH Nordbank, Sächsische Landesbank and WestLB, whose shortcomings ultimately remained to taxpayers.
More and more economists are wondering today: is this still time? Because house prices and apartments have again increased rapidly in many industrialized countries and have partially reached the level before the crisis. Although the main cause is not too lax as in the United States, but extremely low interest rates, which facilitate all mortgages.
In a recent badysis, the German Institute for Economic Research (DIW) examined these factors for 20 OECD countries. That is, the toxic ingredients needed to roll back the price hike: when were there any eruptions, for example, of economic growth and house prices, when a bubble burst? ?
Indications of speculative behavior
The result should bring all those who now want to enter the real estate expensive, to think: "The risk that real estate bubbles are created again, which can lead to a new crisis financial and economic world, is real, "says the author of the study. and real estate economist DIW Claus Michelsen. "The regulation of financial markets has not progressed as far as we would like."
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In many places, there is evidence of speculative investment behavior of investors. For example, the authors of the study believe that speculative bubbles are likely in the UK, Portugal and Sweden. In Germany, the danger of a real price bubble is not yet pronounced, but there are significant exaggerations of local prices.
The list of ingredients for mixing bladder poison at DIW includes the following factors: real long-term interest rate, economic growth, the ratio between the purchase prices of real estate and their respective rents, the economic loan-to-growth ratio and the household debt.
At least with regard to the last two factors, the DIW gives a clear signal to Germany. For example, debt is still within the limits of most countries. Even in the United States, the debt burden has risen from 145 percent to 110 percent of household disposable income. Households also emerge much better in Spain than ten years ago.
The Bundesbank also regularly certifies a good credit rating for German borrowers and, despite regular warnings, finds no sign of over-indebtedness. Many buyers in Germany invest between 10% and 20% equity and avoid interest rate risks thanks to long-term credit conditions
Therefore, according to the Bundesbank, the initial loan-to-value ratio, ie the share of loans from private real estate buyers, is always d. about 80%.
There are other special risks in Germany for this. "The calculations, for example, show for Germany that a large part of the price increases since 2010 can be attributed to lower funding costs," notes the DIW. If the market price goes down, the over-indebtedness threatens
Because if there was a rapid increase in the interest rate manager, the demand for real estate would drop drastically because of the then more expensive financing – and more radically than in other states. Because the Germans put their savings mainly in the real estate, because the alternatives are missing.
"If the price of the real estate market is meanwhile lower than the mortgage, the household is over-indebted," warn economists DIW. Even if credit continues to run – in the end, banks will have to fight with incorrect valuations, with an open result.
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Many buyers are therefore investing in the hope of a price hike not s & # 39; wait to recover the purchase price at average rental income. "If the expectation of rising real estate prices, but then disappointed, it will burst the speculative bubble," the DIW.
Other ingredients for the Blasengiftmischung are ready in Germany: A relatively high population growth, but this is due to the immigration of refugees. And relatively strong economic growth.
An accident is not obligatory
A high growth of the gross domestic product (GDP) over several years is always something good. But if it breaks, the consequences for the disproportionate increase in real estate prices are generally unpleasant.
According to the DIW, a GDP growth rate of one percentage point increases the probability of a speculative bubble by six points. Credits double in relative terms, with an additional increase of 28 percentage points.
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The researchers point out that a period of speculative price development does not necessarily follow the crash must, even if said poison mixture is already ready. On the other hand, it is also difficult to say what impact a collapse in other countries might have on the local market.
For example, the fire warning bubble in Germany is between green and yellow. In Sweden, however, DIW sees a deep red.
DIW economist, Michelsen, warns against easing the regulation of the credit market. "It would be difficult to respond adequately to the crisis with the current opportunities, all the more so that a considerable resistance to the limitation of loans would be expected."
From 2019 – Child Benefit Construction and Child Benefit
Please try again later.
Starting in 2019, families will receive a maximum of € 12,000 per child to finance their four walls. This also applies to real estate of over 120 square meters. In addition, there will be higher child support.
Source: WORLD / Daniel Franz
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