Occasional, generalizing comments about a price bubble are, according to LBS association director Hartwig Hamm, totally unfounded: “This is because prices are still cheap, they are on average more than 10 percent below those of the year 2000.”

The estate agencies associated with LBS sold more than 25,000 properties during the first nine months of this year, 8 percent more than during this period of the previous year. With an increase of 14 percent, the third quarter was particularly strong. Most of the properties sold during this time – 18,000 properties – were owner-occupied houses and apartments.

According to the LBS report, there are strong indications for a continuing upward trend in the property demand.

• Location: Weimar (Thuringia)
• Type: Residential/Commercial Property
• Year of Construction: 1938 (refurbished and modernized)
• Total Net Rent p.a.: €69,609
• Gross Yield: 8.00%
• Purchase Price: €870,000

This property, which was constructed in 1938 and consists of a main and a side building, is in excellent condition. With exception of one unit on the 1st floor (left), which was last refurbished and modernized in 1992, the whole property was completely refurbished and modernized in 2009 and 2010. The apartments were fitted to modern standards, with new bathroom fittings, laminated flooring and insulating PVC windows. Heating is gas central heating, a lift was fitted in the main building.

The ground floor premises are let to a bank since 1993 and were fully re-designed in 2010. Further commercial tenants include a health service provider, a driving school and a law firm. The property further comprises four apartments which are all fully let.

Location

The property is situated in a central location within the City of Weimar. The city centre can be reached within 5 minutes walk, the next bus stop within 1 minute.

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With a population of c. 65,000, Weimar is the fourth-largest city in the federal state Thuringia. The city has 2,540 companies with approx. 20,800 employees and enjoys very good traffice connections in all directions (A4-East/West; A9 and A71-North/South). The city is well known for its cultural heritage (“Weimar Classicism” around Wieland, Goethe, Herder and Schiller; 1919 constitution of the first “Weimar” republic in Germany) and therefore an important German tourism destination. Accordingly, the hotel and catering sectors are further important economic factors in the city. The city has the third largest population growth of all German cities. The population increased thus from 60,326 in 1990 to 65,233 on 31st December 2009.

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• Location: Frankfurt am Main
• Type: Apartment House with 8 Apartments
• Year of Construction: ca. 1905 (fully refurbished and modernized in 2001)
• Total Net Rent p.a.: €56,418
• Gross Yield: 6.07%
• Purchase Price: €930,000

This four storey property comprises of eight apartments ranging in size from 46.5 to 69.9 square metres. The property was originally constructed in c. 1905 and was completely refurbished and modernized in 2001. The property is in an excellent condition. The apartments have laminated flooring and windows were replaced with modern, sound-proof PVC windows. The property has Broadband-DSL-Internet and Cable-TV connections.

Location

The property is situated in the Borough of Rödelheim in the North-West of the City of Frankfurt am Main (also see Frankfurt Rhine-Main Region).

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The borough has a population of approx. 17,900 and is known for its apple wine – one of the largest apple wine producers is situated here, surrounded by hightech companies, such as Europe’s largest IT center and the German air traffic control.

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• Location: Frankfurt am Main
• Type: Apartment House with 9 Apartments and 1 Commercial Unit
• Year of Construction: 1895 (fully refurbished and modernized in 2001)
• Total Net Rent p.a.: €77,713.44
• Gross Yield: 6.22%
• Purchase Price: €1,250,000

This property is situated in the City of Frankfurt am Main Borough Höchst. The five storey building consists of nine apartmens, which vary in size from 65 to 93 square metres, and a commercial unit on the ground floor, which is currently let to dry cleaners. The property was constructed in 1895 and fully refurbished and modernized in 2001, including all technical installations. The apartments have laminated flooring and were fitted with modern, soundproof PVC windows. The property is in an excellent condition. Broadband-DSL-Internet connectivity and cable TV are available.

Location

The property is situated in the Borough of Höchst in the City of Frankfurt am Main (also see Frankfurt Rhine-Main Area).

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Höchst is named after the chemical and pharmaceutical company Hoechst AG, which had its headquarters here between 1863 and 1999. Since then, the former Hoechst site was converted into an industrial park. The Höchst Industrial Park now provides 22,000 jobs in more than 90 companies and is, after the Frankfurt Rhine-Main Airport, the second largest workplace in the region. Höchst is situated at the junction of the River Nidda and the River Main and today has a population of c. 13,900.

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• Location: Dresden (Borough of Bühlau)
• Type: Retail and Commercial Centre
• Year of Construction: 1998 (incorporating modernized and refurbished historic, listed buildings)
• Total Net Rent p.a.: €359,682
• Gross Yield: 9.10%
• Purchase Price: €3,960,000

This retail and commercial centre is situated on the historic Ullersdorf Square in the City of Dresden, an important traffic junction and the centre of the Borough of Bühlau.

The retail and commercial centre (Stadteilzentrum) Ullersdorfer Platz consists of three separate buldings. The property was newly constructed in 1998 on a 5,455 square metre site and features approx. 3,943 square metres of retail and commercial areas, which are fully let. The annual net rent amounts to approx. €360,000. This amount will increase over the coming years because of graduated rents, the rental of underground car parking spaces and the installation of commercial solar panels on the flat roofs.

The various tenants include a leading German food discounter, a fitness and bowling centre, various shops, cafe bars and restaurants (full details available on request). In addition, the property comprises 48 car parking spaces, 36 underground car parking spaces. Approx. 110 public car parking spaces are located in the immediate neighbourhood.

In addition to the excellent current yield of 9.1%, the property has further income growth potential: while graduated rents have been agreed with some tenants, which will increase the revenue over the coming years, these rents do not fully meet the potential rents. A commercial solar panel system will be installed in the next few months, which will further increase the attractiveness of the property.

Location

The property is situated on the historic Ullersdorf Square in the City of Dresden, an important traffic junction and the centre of the Borough of Bühlau. The borough of Bühlau has a population of c. 12,000 and is located a few kilometres East of the centre of the City of Dresden.

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Dresden, with a population of 523,000, is the capital of the Free State of Saxony. The city is an important traffic and economic centre within the Dresden metropolitan region (approx. population: 750,000). The city, which is also referred to as the “Florence on the River Elbe” is famous for its Baroque and mediterranean architecture within idyllic surroundings.

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• Location: Gotha (State of Thuringia)
• Type: Two residential city properties comprising 14 apartments
• Year of Construction: 1904 (fully refurbished and modernized in 1994/1995)
• Total Net Rent p.a.: €54,164.40
• Gross Yield: 9.10%
• Purchase Price: €595,000

This residential property consists of two multi-dwelling houses with altogether 14 apartments. The properties were originally constructed in 1904 and fully refurbished and modernized in 1994/1995. The outside facade was completely refurbished in 2009. In the course of refurbishment  all windows were replaced with modern PVC windows, bathrooms were completely redone with attractive tiling and new bath tubs. The very well preserved timber flooring in the apartments was either restored or, if desired by the tenants, replaced with new timber floors. Both properties are fitted with Viessmann gas central heating.

The buildings are situated on a large site with approx. 1,625 square metres which is used by the tenants for barbecues, as playground, for sunbathing and relaxing. The tenants look after the staircase cleaning and garden maintenance. According to information provided by the vendors, the property is fully let and there are no rent arrears. There were no extended vacancies during tenant changes.

Location

The property is situated in the City of Gotha (pop. 45,600), the fifth largest city in the Free State of Thuringia and district capital of the District of Gotha.

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The location of the property within the city combines quality of life with a central location and very good public transport connections. The central railway station can be reached within 7 minutes, the Castle Park within 10 minutes. Supermarkets are within 100 metres, the pedestrianized shopping area of Gotha can be reached within a 10 minutes walk. Various schools and public creches can be reached within 15 minutes by public transport. The A4 motorway can be reached within 5 minutes.

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• Location: Grossostheim (Greater Frankfurt Rhine-Main Area)
• Type: Town centre residential building comprising of 5 apartments
• Year of Construction: TBC (fully refurbished and modernized in 1996)
• Total Net Rent p.a.: €27,380
• Gross Yield: 6.52%
• Purchase Price: €420,000

This residential property consists of a front (roadside) house and a rear house. The property was fully refurbished and modernized in 1996 and is in a very good condition. The property is located in a central, yet very quiet location.

The front house comprises two apartments, a 75 sqm apartment on the ground floor and a large 150 sqm apartment with balcony on the first floor. The rear house comprises of three apartments and storage areas. The apartments are up to modern standards, including electric, sanitary and heating installations. Satellite television  reception is available throughout the house. Broadband DSL-Internet is available.

Location

The property is situated in a central, yet very quiet location within the town of Großostheim, within the Greater Frankfurt Rhine-Main Region and within easy commuting distance of Frankfurt am Main.

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The town is situated in idyllic rural surroundings on the periphery of the Odenwald Forrest. At the same time, it has excellent traffic connections – the A3 motorway can be reached within 10 minutes, the City of Frankfurt and the Rhine-Main Airport within 30 minutes. The population of Großostheim has been steadily increasing from 13,514 in 1987 to currently approx. 16,430.

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• Location: Darmstadt (Greater Frankfurt Rhine-Main Area)
• Type: Modern Office Building
• Year of Construction: 1994
• Total Net Rent p.a.: €108,210
• Gross Yield: 7.73%
• Purchase Price: €1,400,000

This property is an attractive, high-quality office building. The modern architecture and the appealing roadside facade, with its large windows and bright rooms, create a great working environment. The property was constructed in 1994 and is very well maintained. The offices are individually designed and can be easily adjusted to the tenants’ requirements. The staircase with lift is friendly and welcoming.

The property is currently fully let to five individual commercial clients, including a health insurer and the German telephone book publishing house, generating an annual net rent of €108,210 and a gross yield of 7.73%. The owner of this impressive property is currently negotiating new leases, which, if successfully concluded, will increase the rental income to € 116,280, a gross yield of 8.31%.

Location

The property is situated right in the centre of the City of Darmstadt (pop. 144,400), the Central Station and the extensive, pedestrianized city centre can be reached within a few minutes walk. Darmstadt has an excellent reputation as a research centre, is home to a Technical University with approx. 35,700 students and more than 30 other research institutions. The City of Darmstadt is located approx. 30km south of the City of Frankfurt (Main) and within the Greater Frankfurt Rhine-Main Region.

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The index value, which was determined by ImmobilienScout24 increased by 18.5 points between March 2007 and February 2011. Hamburg is closely followed by Munich with 18.3 points. Berlin has a plus of 13.3 points for this period and Frankfurt (Main) a plus of 11.4. The prices for properties offered in Cologne increased by only 1.2 points and are therefore below the German average of +1.7 percent.

Image: Viktor Mildenberger  / pixelio.de

The survey does, however, point out the enormous price differences from region to region. These price differences could be best observed in relation to development land for residential dwellings. In this sector, the square metre prices in some conurbations were 20 times higher than those in some cities in Northern and Eastern Germany.

With respect to second hand residential property, the LBS experts observed an overall increasing demand. According to the survey report, the motto for the next few months will be: “Growth”. At the same time it is expected that in many cities the supply will dwindle. Growth in the sector for newly built residential property is slow. This means, according to the report, that there will be supply bottle-necks and increasing prices – estimates expect increases of up to 3 percent until the end of the year.