• Germany lies at the heart of Europe

•  Germany is the largest economy in Europe, the third largest in the world after USA and Japan

•  It is the largest country in the EU with over 82 million people

•  Germany has a stable government with a strong and transparent legal system

•  In recent years, in tandem with increased productivity, there has been a strong recovery in corporate profits

•  Germany accounts for almost one-third of the Euro-zone economy and is again Europe's driving economy

Why invest in the German Property Market?

The combination of low euro-zone interest rates and high yields in Germany make it an attractive property market. On national average, the UK has seen prices rise more than treble in the past decade, whereas in Germany prices have remained static. Ian Stewart of Merrill Lynch, the US investment bank, recently said “the greatest potential for price rises is perhaps in one of the most depressed and undervalued markets in the world – Germany ”

There is a window of opportunity which will close as economic growth continues and investment inflows increase and yield compression leads to growth in capital values.

In 2006, after more than ten years in recession, Germany finally made a revival in international property markets.

• Since 2006 the German property market has been driven by international investors who are attracted by strong economic growth prospects, low price inflation and good yield prospects
  
• Even the most sought after locations in Germany offer very attractive yields when compared to other major locations in Europe, e.g. London, Paris, Madrid
  
• The German property market is in the recovery phase and cannot be considered overheated – therefore the risk of a drop in property prices is very low
  
• The German stock exchanges continue to perform strongly when compared to other peer European indices
  
• Business confidence is at a fifteen year high (ifo Index), unemployment falling, increasing productivity and huge pent up consumer demand

Performance of the German Property Market

The German property market differs in many respects from markets in other European countries. The most conspicuous factor is that property prices in Germany have detached themselves from the strong international upward trend. Whereas German prices today are no higher than in the late 1990's, prices in other markets, the US, UK and Ireland have soared in the period (+418% between 1990-2005 in Ireland )

Comparing its yields to other European countries, Germany generates higher returns while at the same time giving justified reasons for continued growth.

Commentators are forecasting yield improvements of up to 50 basis points for 2008.