Berlin has unbelievably attractive purchase prices
For the 10 years of 1994 - 2004 property prices fell in Berlin and only in the last three years has this position stabilised. Investors have realised that Berlin Property is now one of the least expensive in Europe.

 

Prices in Berlin are below those of Budapest, Prague and Warsaw and when compared with other Western capital cities Berlin appears remarkably inexpensive. Property is available in the German capital at less than 1,000 euros/m² (around £650/m²) which compares with London typically in excess of 7,500 euros/m² (around £5000/m²) or Paris at 6,000 euros/m² (£3,500/m²).

Add to the mix the recent development in tourism (up 16% last year), the availability of cut price flights and the sheer fun of a city which has thrown off the past shackles of the Wall and is rapidly becoming one of the liveliest and most interesting city in Europe. Oh and the beer’s good too.....!!

 

Higher investment returns than the UK
A typical return from a fully tenanted block of apartments (or a single unit) is between 4% and 10% with mortgage rates of as little as 3-4%.

 

Euro mortgage rates are lower than the UK
There is a healthy and competitive mortgage market available in Germany with English banks taking an increasing interest. Mortgages are fairly easy to obtain, with banks typically lending 50-60% of the valuation. Rates can be as low as 4% and can normally be fixed over several years.

With rental income typically at 4-10 % (or more) it’s not difficult to see the attraction of buying in Berlin! Perhaps this explains why in recent years a number of major players have made significant investments. For example, Terra Firma, a British private-equity firm, in 2006 reportedly bought a package of 150,000 flats, many of them in Berlin.

Strong and improving economy
The unified Germany has had a tough time incorporating the old, East German economy requiring significant restructuring which has been necessary to meet the challenges of European economic integration. Germany now has the fifth largest economy in the world with falling unemployment and a 2.2% growth rate recorded in 2006.

Germany has the highest gross domestic output within the European Union as well as the largest population which now exceeds 82 million. In terms of the global trading of goods and services Germany is second only to the USA.
Germany stands out as a centre for business through innovative and internationally active companies, qualified and motivated employees, an internationally recognised education system, an excellently developed infrastructure, as well as top achievements in research and development. Germany is back as the power house of Europe and Property prices are moving to reflect this!!

Regulated legal system and EEC protection
Germany is a modern constitutional state, a democracy at the heart of Europe. Germany also has a legal system that protects the rights of individuals and supports them to enforce these rights. The systematically structured and balanced legislation creates security, because it uses transparent decision criteria that can be understood by all.

Operating within the EEC the investor has all the protection that has been enjoyed within the UK and Ireland.