up to 40 percent too expensive

Frankfurt The Bundesbank has warned of the ever faster rising prices on the residential real estate market. In 2021, prices rose even more sharply than in the previous year, according to the institute’s current monthly report. According to Bundesbank estimates, the price level in cities is now “between 15 and 40 percent above the price indicated by fundamental socio-demographic and economic factors.” Last year, the central bank still assumed an overvaluation of a maximum of 30 percent.

Not only the Bundesbank warns of increasing risks in the real estate market. The European Systemic Risk Board (ESRB) also recently called for concrete measures to curb the surge in prices. And even the leading German association of the real estate industry ZIA calls the enormous level of purchase prices in German metropolises “both surprising and quite frightening”.

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