Zahlen & Daten Facts & Figures. Residential Market Report Germany

Transcription

1 Zahlen & Daten Facts & Figures 2014 Residential Market Report Germany

2 Facts & Figues Table of Contents 1. Introduction Summary The Residential Property Market in the Federal Republic of Germany Economic framework CPI and GDP Employment and unemployment Purchasing power Population and households Population trend Population structure Households Housing development Housing stocks Housing structure Vacancies Residential building completions Housing demand Supply structure on the German housing market Division of housing stocks Germany, a rental market Rents and prices Pan-German overview Property bubble yes or no? Rent increase cap will it bring the hoped-for change? Rent and price development in Germany s metropolitan areas Transaction market for residential portfolios Market situation Regional distribution Origin of investors Type of investors City-Attractiveness-Ranking - StAR Overview Methodology Status Quo Market development Image premium Overall ranking German Metropolises In Brief Berlin Cologne Dortmund Dresden Düsseldorf Essen Frankfurt am Main Hamburg Leipzig Munich Stuttgart Supply and Demand in German Urban and Rural Districts Federal States In Brief page 5

3 Facts & Figures Overview 4. City-Attractiveness-Ranking - StAR page 45

4 4.1. Overview There are many city rankings, but they often take too few factors into account to be an up-to-date and reliable guide for investors, portfolio holders or even owner-occupants for the first valuation of a property location and its future potential. The city-attractiveness-ranking (Städte-Attraktivitäts-Ranking) or StAR has been updated for the third time this year and this time has taken a broader approach. As well as the usual economic and socio-demographic indicators such as residents, household numbers, purchasing power or unemployment, a number of other residential aspects such as vacancies, the need for new housing and price developments are included in the survey. At the same time, a new form of weighting has been used that allows a dynamic valuation system for the 24 different indicators. StAR allows prompt and reliable statements about the current and future attractiveness of the 110 independent German cities or cities with a similar status* Methodology The StAR methodology is based on a two-part, weighted point rating system. By drawing a distinction between status quo and market development, various indicators and their performance are grouped into a point scale of 0 to 100. Indicators from the image subject area are not assessed according to the degree of performance but according to the general performance (yes/no). For the partial appraisal of a location (status quo and market development), the individual indicators are initially grouped into different subject areas and both the individual indicators and the subject areas are weighted according to their respective importance for the attractiveness of the residential property market and its development. The subject areas are population and households, economy, housing situation, rents and purchase prices and image. Each subject area is based on at least two and a maximum of four (sub) indicators. The large number of indicators is a key differentiation from other city rankings. As many factors as possible that influence a market are accounted for, enabling a comprehensive analysis of a location. The results of the status quo rating as well as the development rating result from the summation of the weighted subject ratings, the (possible) inclusion of an (image) premium and the grouping of the results into an attractiveness-level matrix. The overall assessment results from the summary of the sub-matrices: status quo: weighting 40%; market development: weighting 60% + image premium. A special feature of this year s StAR is the inclusion of the latest data from the 2011 population census that has now been largely confirmed and already updated for This allows the deficiencies of the previous updates to be remedied and also contributes to the further improvement of StAR. The expanded base of analysed rents and purchase prices also serves this goal. Thus the review carried out in previous years of just one sub-segment (construction year after 2000; 70 sq m; high-quality property) has now been replaced by a review of the total housing supply. Status Quo Category Criteria Weighting Period Population and Households 5 Population census (absolute) STATUS QUO - 40 % Number of households May census (absolute) Inhabitants per household May census (absolute) Economy 25 (GfK) purchasing power (Index) Unemployment (in %) Employees in service sector (in %) Housing situation 25 (empirica/cbre)-vacancy (in %) Residential units per household May census (ratio) Rents and Prices Rental prices 42,5 H ( /sq m) 45 Purchase prices 42,5 H ( /sq m) H Costs of living 5 (proportion of rents in income) Yield 10 H (in %) Market development Category Criteria Weighting Period Population and Households 28 Population development (in %) MARKET DEVELOPMENT - 60 % Development of households (in %) Population development (BBSR) (in %) Development of households (BBSR) (in %) Economy 22 Development of purchasing power (in %-points) Development of unemployment rate (in %-points) Housing situation 28 Development of vacancies (in %) Need for new construction (Ø per 1,000 inhabitants per year) Rents and Prices 22 Development of rental prices H (in %) Development of purchase prices H (in %) Development of rent-purchase price-ration H (ratio) page 46 Source: NAI apollo group s City-Attractiveness-Ranking StAR 2013 Image premium ( based on premium for major city, university city, proximity to major city)

5 4.3. Status Quo As part of the status quo rating, the current situation of the independent German cities is determined and rated according to their attractiveness. Through a differentiation by the subject areas of population and households, economy, housing situation, and rents and prices, a total of 12 indicators are included in the study incorporating both demand and supply. Population and households The large German cities gain an above-average rating because of their high population and household numbers. On the other hand, regional centres benefit particularly from a low average household size, i.e. a high proportion of one-person and two-person households. This is regarded as a sign of strong demand from young people. As in the previous year, the upper places of this sub-ranking are populated both by the large national metropolises such as Berlin, Munich, Düsseldorf and Frankfurt am Main and by regions experiencing population growth, especially Leipzig, Hanover, Dresden, Würzburg and Regensburg. Economy As well as a positive demographic situation, economic strength is an important indicator for the attractiveness of residential locations. On one hand this is a major cause variable for the achievable rents and purchase prices. On the other hand, economic prosperity is a central cause of housing demand. In a breakdown by the various indicators (purchasing power, unemployment and service sector ratio), the cities Munich, Düsseldorf, Frankfurt am Main and Stuttgart as well as Wolfsburg in Lower Saxony and southern German regional and administrative centres including Erlangen, Baden-Baden, Landshut and Ingolstadt again have the highest purchasing power. In the area of unemployment, it is again the case that only cities in south Germany with 40,000 to 150,000 residents are in the upper part of this sub-ranking, led by Ingolstadt, Memmingen and Erlangen. Of the large German cities, Munich is the first to appear in place 15. In the assessment of employment in the services sector, administration and services centres Dynamic system adjustment The basic system of StAR is provided with a statistically optimal weightings profile. Strengths and weaknesses, especially in direct comparison to other locations, are clearly identified. This applies to the assessment of the status quo, development and overall assessment as well as to the 24 individual indicators of the different subject areas (population and households, economy, housing situation, rents and prices and image). When making firm investment decisions, more extensive studies are needed. For instance, various micro location characteristics are pointed out that can differ from the overall situation in the city. Through dynamic selection options, StAR is able to address these one-off specific requirements by means of a stronger or weaker weighting of individual criteria as well as through the adjustment of the respective characteristics. as well as cities that are strongly dominated by tourism or universities reach peak levels. For instance, as well as the banking metropolis Frankfurt am Main, Potsdam, Bonn, Ranking Status Quo* Munich 1 Erlangen 2 Hamburg 3 Frankfurt am Main 4 Stuttgart 5 Heidelberg 6 Cologne 7 Düsseldorf 8 Regensburg 9 Ingolstadt 10 Bremerhaven 101 Duisburg 102 Gelsenkirchen 103 Brandenburg an der Havel 104 Herne 105 Wilhelmshaven 106 Salzgitter 107 Dessau-Roßlau 108 Gera 109 Pirmasens 110 Source: NAI apollo group s City-Attractiveness- Ranking StAR * incl. image premium Ranking Market development* Berlin 1 Munich 2 Landshut 3 Hamburg 4 Frankfurt am Main 5 Stuttgart 6 Ingolstadt 7 Nürnberg 8 Ludwigshafen am Rhein 9 Cologne 10 Solingen 101 Oberhausen 102 Gelsenkirchen 103 Hof 104 Herne 105 Bottrop 106 Eisenach 107 Remscheid 108 Pirmasens 109 Hagen 110 Source: NAI apollo group s City-Attractiveness- Ranking StAR * incl. image premium page 47

6 Mainz, Münster, Oldenburg and Weimar are among the cities with the highest service sector ratio in the study. Housing situation Within StAR the current situation with regard to housing supply is described using vacancies and the provision of housing. Both criteria imply an over and/or under supply. At the same time a shortage of supply is rated as a plus factor for the attractiveness of a location. The supply of housing is dictated to a large degree by the demand for housing. Strong demand absorbs the supply, which is reflected both by the number of vacancies and the residential units/households ratio. It is therefore not surprising that cities dominated by a positive economic and/or positive demographic situation find themselves in the upper positions in the assessment of the housing situation. According to the latest empirica vacancy figures for 2012, the lowest vacancy rates in multi-family buildings are found in the cities of Munich, Hamburg, Münster, Frankfurt am Main and Darmstadt. According to the updated census, the lowest supply of housing measured by the ratio of residential units per household exists in Regensburg, Erlangen, Heidelberg, Freiburg, Würzburg, Kassel, Jena and Darmstadt. Rents and prices The cost of housing falls into the subject area of rents and prices. High prices (for condominiums) and high rents - this year average rents/prices for the entire housing segment are analysed within StAR - are given a positive rating as they indicate strong demand in the market. A large number of the large German cities, including Munich, Frankfurt am Main, Hamburg, Stuttgart, Düsseldorf and Cologne, are given a high ranking. In addition, Freiburg, Heidelberg, Mainz, Wiesbaden, Ingolstadt and Erlangen are in the upper section of the sub-ranking. The level of the theoretically achievable average yields, calculated from the aforementioned rents and prices, is rated in StAR as an incentive for investments. The result is broadly mixed. The analysis of living costs, measured as the average rent s share of a household s purchasing power, reveals the financial burden of housing costs. A low burden, such as in Remscheid, Zweibrücken, Hagen, Mülheim an der Ruhr, Hof and Landau, can be seen as a sign for potential rental increases. However, the basic economic conditions need to be taken into account here, and opportunities for an increase should be assessed in each individual case. prices are identical with the study content of the status quo assessment. This subject-specific continuation of the assessment ensures an additional rating of every individual area. The development of demand and supply is therefore once again measured and assessed with a total of 12 indicators. A new and more detailed description of the individual indicators is only provided at this point in individual cases. Population and households In the analysis of demographic development, there is a high level of consistency in the evaluated areas. Thus last year s variations in household and/or resident numbers look set to continue in the majority of the cities in future, both in terms of positive and negative developments. Even when using the updated census figures, the result is similar to that of the previous year. The best developments measured by the average of the past and future changes in residents and households show besides the large German cities of Munich, Stuttgart, Cologne, Düsseldorf and Hamburg other towns and cities such as Landshut, Potsdam, Freiburg, Ingolstadt, Oldenburg and Münster. Economy Within the assessment of economic development, which is measured on the basis of the past development of purchasing power and unemployment, both traditionally economically strong and economically weak locations are again ranked in the upper positions. In the purchasing power subsection, some of the largest German metropolises such as Hamburg, Stuttgart und Berlin are ranked in the highest positions. However, compared to the federal average the growth in purchasing power has been strongest in Würzburg, Oldenburg, Regensburg and Ingolstadt. Economically weaker towns and cities such as Zweibrücken, Bremen, Bremerhaven, Wilhelmshaven and Schweinfurt also appear in the upper third of this sub-ranking. In the unemployment sub-section, there are changes compared to last year. While in 2013 the upper positions were still broadly mixed, in 2014 they are occupied exclusively by cities from the new federal states (Erfurt, Brandenburg an der Havel, Weimar, Schwerin, Berlin, Leipzig and Rostock), which last year managed to reduce unemployment from previously very high levels. The first city to appear from the old federal states, Koblenz, was ranked only in 10th position. Hamburg was the first metropolis to appear and occupied position 32. Housing situation page Market development Within the assessment of market development, the past and projected development of independent German cities is analysed. The analysed subject areas of population and households, economy, housing situation and rents and While the past change in the housing situation is assessed by means of the development in vacancies, the projected need for new housing (per resident) is an indicator for the future situation in the respective locations. A higher need for new construction is rated as an indicator of attractiveness. In the top group of the vacancies development sub-section, Frankfurt am Main, Darmstadt, Freiburg, Jena,

7 Bonn and Heidelberg featured a further noticeable decline this year in spite of already very low vacancy rates. On the other hand, Schwerin, Halle, Frankfurt (Oder), Magdeburg and Emden among others managed to significantly reduce above-average vacancy rates. However, it should also be indicated here that the demolition of socialist housing in cities in the new federal states in recent years also contributed to this development. However, this is not taken into account in StAR. The highest need for new housing (units per resident) both in terms of the new and replacement housing is projected to be in Munich, Frankfurt am Main, Berlin and Wiesbaden. As no updated analysis exists in this regard, there are no changes in this sub-segment compared to the previous year. Rents and purchase prices Developments in recent years in (advertised) rents and purchase prices are extremely diverse in Germany. In the study period from 2013 to the first Half of 2014, the variations range from -4.3% to +11.8% (prices of condominiums) and -2.8% to +6.8% (rents). In an overall analysis of both sections, Wolfsburg, Offenbach, Hanover, Munich, Rosenheim and Aachen emerge as the cities that exhibit aboveaverage growth for both rents and purchase prices. A final section is the direct comparison of the changes in rents and prices by rating the development of rents and prices in relation to each other. At the same time, more positive rental growth is rated as an advantage. The results show a much higher percentage increase in rents than purchase prices in Ansbach, Schwabach, Kiel and Kempten, among others. As in previous years Munich (1) occupies the number one position within StAR. Other German metropolises in the top 10 of this ranking include Berlin (2), Frankfurt am Main (3), Stuttgart (4), Hamburg (5) and Cologne (10). These cities scored points particularly for their very positive economic and demographic development and situations. As a rule, high purchasing power, low unemployment and a high and growing number of residents/households lead to a shortage of housing and rising rents and purchase prices. As in previous years, second-tier cities such as Ingolstadt (6), Landshut (7), Erlangen (8) and Freiburg (9) were also in the top 10. However, this phenomenon has gradually become less evident in recent years. In 2012, there were only three second-tier cities in the top 5, for example. In 2013 this was reduced further to just Ingolstadt, which has now dropped to sixth place. The lowest positions in the overall ranking are traditionally occupied by cities from structurally weak regions. So along with Pirmasens (110) in Rhineland Palatinate, Salzgitter (103) in Lower Saxony and Hof (101) in Bavaria the flop 10 mainly includes cities from the new federal states [Eisenach (108), Gera (104), Frankfurt/Oder (102)] and from North Rhine Westphalia [Hagen (109), Herne (107), Remscheid (106), Gelsenkirchen (105)]. Compared to the previous year, changes in ranking ranged from a drop by 18 positions to a rise by 23 places. Wolfsburg is the frontrunner here, improving its ranking from position 61 (2013) to position 38 (2014). This was due primarily to positive developments in vacancies, rents and purchase prices. Although far from a dramatic decline, the fact that Hamburg lost its long-held second place (now in position 5) was striking. This was primarily due to the recent absence of rental price growth, which only applied to Hamburg in the top group Image premium The image premium takes place outside of the weighted assessment of status quo and market development. It involves a percentage increase (10 to 15%) of the assessment results. This can take place within the partial analyses both in the status quo section as well as the market development section. Within the scope of the overall assessment, the potential image premium is determined and included at the end of the assessment following the summary of the status quo and market development results. Image criteria include the size of the analysed city, the proximity to a metropolis or the presence of a university Overall ranking page 49

8 page 50 * Aachen, Amberg, Ansbach, Aschaffenburg, Augsburg, Baden-Baden, Bamberg, Bayreuth, Berlin, Bielefeld, Bochum, Bonn, Bottrop, Brandenburg an der Havel, Braunschweig, Bremen, Bremerhaven, Chemnitz, Coburg, Cologne, Cottbus, Darmstadt, Delmenhorst, Dessau-Roßlau, Dortmund, Dresden, Duisburg, Düsseldorf, Eisenach, Emden, Erfurt, Erlangen, Essen, Flensburg, Frankenthal (Pfalz), Frankfurt (Oder), Frankfurt am Main, Freiburg im Breisgau, Fürth, Gelsenkirchen, Gera, Hagen, Halle (Saale), Hamburg, Hamm, Hanover, Heidelberg, Heilbronn, Herne, Hof, Ingolstadt, Jena, Kaiserslautern, Karlsruhe, Kassel, Kaufbeuren, Kempten (Allgäu), Kiel, Koblenz, Krefeld, Landau in der Pfalz, Landshut, Leipzig, Leverkusen, Lübeck, Ludwigshafen am Rhein, Magdeburg, Mainz, Mannheim, Memmingen, Mönchengladbach, Mülheim an der Ruhr, Munich, Münster, Neumünster, Neustadt an der Weinstraße, Nürnberg, Oberhausen, Offenbach am Main, Oldenburg (Oldenburg), Osnabrück, Passau, Pforzheim, Pirmasens, Potsdam, Regensburg, Remscheid, Rosenheim, Rostock, Saarbrücken, Salzgitter, Schwabach, Schweinfurt, Schwerin, Solingen, Speyer, Straubing, Stuttgart, Suhl, Trier, Ulm, Weiden i.d. OPf., Weimar, Wiesbaden, Wilhelmshaven, Wolfsburg, Worms, Wuppertal, Würzburg, Zweibrücken. StAR Overall Ranking * Munich Berlin Frankfurt am Main Stuttgart Hamburg Ingolstadt Landshut Erlangen Freiburg im Breisgau Cologne Regensburg Nürnberg Düsseldorf Augsburg Rosenheim Heidelberg Wiesbaden Bonn Potsdam Memmingen Münster Oldenburg (Oldenburg) Offenbach am Main Baden-Baden Karlsruhe Kempten (Allgäu) Mainz Fürth Mannheim Ludwigshafen am Rhein Hanover Schwabach Darmstadt Bamberg Braunschweig Dresden Bremen Wolfsburg Osnabrück Würzburg Speyer Ulm Passau Aachen Heilbronn Frankenthal (Pfalz) Aschaffenburg Kiel Straubing Leverkusen Ansbach Lübeck Koblenz Trier Worms Weimar Jena Leipzig Bayreuth Landau in der Pfalz Pforzheim Flensburg Neustadt an der Weinstraße Erfurt Dortmund Mülheim an der Ruhr Bielefeld Coburg Kassel Schweinfurt Delmenhorst Kaufbeuren Rostock Emden Amberg Brandenburg an der Havel Weiden i.d.opf. Kaiserslautern Neumünster Essen Hamm Saarbrücken Schwerin Wuppertal Bochum Krefeld Cottbus Bremerhaven Mönchengladbach Solingen Zweibrücken Magdeburg Halle (Saale) Suhl Chemnitz Wilhelmshaven Bottrop Oberhausen Duisburg Dessau-Roßlau Hof Frankfurt (Oder) Salzgitter Gera Gelsenkirchen Remscheid Herne Eisenach Hagen Pirmasens Source: NAI apollo group s City-Attractiveness-Ranking StAR * incl. image premium within overall ranking 98,8 88,7 88,6 88,1 87,3 87,1 87,1 84,3 83,5 82,0 80,6 80,4 78,9 78,7 78,2 77,9 77,2 75,9 75,0 73,7 73,6 72,8 72,6 72,5 72,5 68,4 68,3 68,1 67,7 66,7 66,4 66,1 65,7 65,6 64,3 63,9 63,5 63,5 63,0 62,7 62,4 60,4 60,2 60,2 59,6 59,1 58,3 57,8 56,3 56,2 55,9 54,7 54,6 54,3 53,4 53,3 53,2 53,1 52,9 52,0 50,1 49,5 49,4 47,7 47,1 46,9 46,8 46,2 46,0 45,8 45,6 43,8 42,2 42,2 41,9 41,5 41,3 41,3 40,0 40,0 39,4 38,3 37,8 36,4 33,7 33,6 33,5 33,0 32,9 32,4 32,2 30,9 30,1 30,1 28,5 28,4 27,7 27,3 26,1 25,7 25,1 25,0 24,3 23,2 22,3 21,6 20,9 19,7 18,7 15,

9 Overall Result StAR Sources: City-Attractiveness-Ranking StAR Map Basis: GfK GeoMarketing GmbH 2014 page 51

10 Facts & Figures federal states Dr. Konrad Kanzler Head of Research +49 (0) Stefan Mergen Managing Partner apollo valuation & research +49 (0) Our services Letting and sale Valuation Asset and property management Property accounting Building management Corporate Finance Research Our locations Berlin Düsseldorf Frankfurt am Main Hamburg Munich Stuttgart Ruhr area Copyright apollo valuation & research GmbH, This report is meant to serve for information purposes only. It was produced with utmost diligence and is based on information from sources that we consider reliable. However, we cannot warrant their accuracy, completeness and correctness. Assumptions, numbers and prognoses in this document shall serve as orientation only. This report does not pursue the goal to promote the sale or acquisition of certain financial assets and may thus not be understood as an offer to do so. It is the reader s responsibility to make his/her own judgment regarding correctness and completeness. apollo valuation & research GmbH will not accept liability for direct or indirect damages that result from inaccuracies, incompleteness or mistakes in this report. We reserve the right to make changes and/or additions to this report at any time. Neither the report, nor parts of it may be published, reproduced or forwarded without the prior written consent of apollo valuation & research GmbH. page 172 Eschersheimer Landstraße Frankfurt am Main Tel: +49 (0) Fax: +49 (0) Mail: info@nai-apollo.de