German commercial property prices drop but show some stabilisation

GERMAN commercial property prices fell 4.7 per cent in the third quarter from a year earlier but showed continued signs of stabilisation, the VDP banking association said on Monday (Nov 11), as the country’s real estate sector grapples with its worst crisis in decades.

Commercial real estate valuations, in decline for two years, rose 0.7 per cent from the second quarter of this year.

It was the second consecutive quarter-on-quarter rise but it is still too early to sound the all-clear, VDP said. Prices may move sideways in the coming quarters, and further setbacks are possible given a weak economy and geopolitical risks.

“It’s still too early to talk about the start of a sustainable upturn in the real estate market,” VDP’s Chief Executive Jens Tolckmitt said. REUTERS