Berlin Property an investment market

Berlin Property an investment market
It is a fact that Berlin in Germany has undervalued real
estate and with shrewd multi national companies already
investing in the city its only a matter of time that others
will follow. It is now time for the smaller overseas
property investor to examine Berlin's housing market.
Research reveals compelling evidence that Berlins housing
market is the next big thing in European city investment.

Berlin real estate offers overseas property investors a
great opportunity to benefit from low prices with great
potential for capital gains. Berlin's property prices are
still low and represent the lowest prices in any European
City. Recently Prudential Real Estate Investors announced
that it had acquired the famous Ewerk office situated in
the heart of Berlin. The Ewerk, a former transformer
station built in 1928, was renovated during 2004 and 2005.

So why is Berlins housing market full of cheap property? A
little research into Berlins City history reveals why
Berlins property prices dropped and never caught up with
other European cities.

The opening of the Berlin Wall (1989) and the reunification
of Germany (1990) resulted in a wave of optimism. The
expectations for Europe's largest economy and it's newly
created capital city Berlin were high. The pent-up demand
particularly from the East Berliners was immense. The
conclusion at the time was that the city required a massive
investment and construction programme in all sectors.

The Berlin construction boom of the early nineties
coincided with both the reduction in residents and more
importantly their purchasing power. This coincided with an
increase in unemployment levels. The net result was a fall
in the price of property and rental values. Berlin
witnessed an increase in the availability of office and
residential space without an appropriate increase in
demand. Between 1994 and 2004 new property prices fell in
Berlin by 30% and rents by 15%.The disposal of large
property portfolios by public authorities further
undermined price levels.

Property prices in most European countries significantly
increased while those in Berlin stagnated or fell. Berlin
now represents the most competitively priced property in
Europe.

The people of Berlin like to rent property with only 12% of
Berliners owning their properties compared with over 20% in
Hanover, Hamburg, Munich and Stuttgart. This lack of demand
has kept prices low and provides buyers with ample supply
of Berlin tenants.

Tourism has increased by 16% in 2004 alone. In excess of
2,000 four and five star hotel rooms have been built in the
last 3 years including Ritz-Carlton and Radisson. There
were 14 million overnight stays in 2005 compared to 11.2
million in 2003. British tourism increased by 22% in 2006
alone.

The indications are that Berlin is set to boom and the time
appears to be now for overseas property investors to head
for Berlin.

----------------------------------------------------
Nicholas Marr is the CEO behind overseas property website
at http://www.homesgofast.com . His position means that he
is contact with hundreds of real estate agents and
developers world wide. This has enabled him to gain a
unique insight into international real estate markets from
those who work in them at first hand.
http://www.homesgofast.com/home/Germany/