
How the coronavirus crisis is changing the real estate market
According to an analysis by financial services provider Sprengnetter, prices for houses and apartments in Germany's ten largest cities have remained stable so far. To date, no extreme market fluctuations have been observed in cities such as Berlin, Munich, or Düsseldorf.
However, market observers take a more critical view. Unlike capital markets, economic crises usually have a delayed impact on the real estate market. Some experts even fear that the coronavirus could trigger a chain reaction.
Property viewings despite social distancing
Viewings are currently difficult and appointments in general are also proving difficult due to the social distancing rules in place. Real estate agents are therefore increasingly turning to online viewings. Information and facts are also being exchanged by telephone. A large part of the operational processes can also be carried out digitally, such as property valuations and purchase price estimates.
Typical buyers, such as young families whose homes are becoming too small, may now be able to postpone their purchase decision at short notice under certain circumstances. However, a secure income must be guaranteed. In general, too, the conclusion of purchase agreements may be delayed. There is a minimum of two weeks between the preliminary contract and the actual conclusion of the contract when purchasing real estate. During this time, some prospective buyers may now also withdraw due to the crisis.
Owners' meetings during the coronavirus crisis
It is not only sellers and buyers who are affected by the crisis; property managers are also struggling with the restrictions imposed by the coronavirus crisis. According to the regulations, owners' meetings may be held, but only in compliance with the current precautions. The Federal Ministry of Justice has not granted permission for online meetings.
The crisis is leaving its mark on builders in particular. Many skilled trades companies have temporarily scaled back or even completely stopped work due to a lack of workers and building materials. The planned completion of properties may therefore be postponed indefinitely.
Would you like to know how you can sell your property despite the coronavirus crisis? Contact us. We will be happy to advise you.
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Legal notice: This article does not constitute tax or legal advice in individual cases. Please consult a lawyer and/or tax advisor to clarify the facts of your specific case.
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