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Lending business of the Pfandbrief banks |
Loan Commitments for Residential Property Investments
In 2010, commitment activity in residential property finance totalled € 33.1 billion; this was 18.4% above the previous year’s level. All market segments – owner-occupied homes, apartments and multi-family houses – made similarly large contributions to loan commitment growth.
This result was attributable primarily to the positive macroeconomic development in the year under review. According to initial calculations by the Federal Statistical Office, Germany’s real gross domestic product rose by 3.6% in 2010. The economic upswing gained increasingly in breadth during the course of the year. Both exports and domestic economic activity regained momentum. There were increases in corporate investment and in private consumer expenditure. Lower interest rates as well as greater household income security thanks to the increasingly more favourable labour market situation gave a strong impetus to the purchase of existing properties as well as to new construction and modernization of residential buildings.
The structure of commitments in residential property finance did not change significantly compared with the previous year. Loans for existing properties (including modernization) accounted for the largest share (50%). New housing construction represented 21% and refinancing 29% of commitments.
