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Real estate rarely decreased in price, especially in Berlin. It may turn out to be a good investment.
by hk-im-ad 5y ago
Real estate rarely decreased in price, especially in Berlin. It may turn out to be a good investment.
- yunohn 5y agoThat’s exactly… the problem? Housing shouldn’t be an investment, for corporates nor the government.
- hk-im-ad 5y agoEven if it’s not an investment, housing will likely always have a price ratchet, so it’s still not terrible for the government.
- ryukafalz 5y agoIf the price goes up any more than inflation long-term, we've still got a problem.
- inglor_cz 5y agoOne of the problems of 2021 is that money printers went brrrr with such intensity that some people are losing faith in future purchasing power of their local currencies and stick any free money into bricks and mortar. Also, where I live, the official inflation is now like 4 per cent, but gosh, so many things are massively more expensive than before (food in restaurants maybe 40 per cent, some construction material even 100 per cent more expensive than before), that it makes people distrustful of official figures.
- djrogers 5y ago> Housing shouldn’t be an investment, for corporates If it’s not, you’re essentially going to eliminate privately owned rental housing.
- yunohn 5y agoI’d be really happy with communal non-private rental housing. Corporates already do a bad job, I don’t see why they should make massive money from limited land resources.
- ohgodplsno 5y agoJust like cars depreciating eliminated privately owned car rentals. Oh, wait, no it didn't. Housing is the only thing miraculously protected from depreciation because making it depreciate would hurt chances at reelection.
- yunohn 5y agoThis is a great point. Physical houses deteriorate and get damaged, just like vehicles. But their value /always/ goes up.
- DamnYuppie 5y agoRealestate is a commodity so it is unrealistic to think that it wouldn't have value and it would increase overtime as supply and demand fluctuate.
- lumost 5y agoThe only way for housing to keep rising at its current speeds is for buyers to spend a greater share of income on housing and for interest rates to fall. Interest rates are near zero and individuals are spending very large portions of their income on housing. Continued expectations for high returns on housing will lead to hard landings/defaults or pathological cases where renters don’t pay rent and can’t be evicted.
- ivan_gammel 5y agoThis is based on assumption that average property user income will not rise and that the possible profits are almost maximized. Berlin is growing fast, creating lots of new jobs, often well-paid ones (above national average) filled by immigration, so demand is growing faster than construction of new apartments. And prices are still below Munich or other big cities. That said, this is an indicator of liquidity showing that property is indeed a secure and reliable asset, but this is not the reason for investment by city.
- rastafang 5y agoIm glad I bought in 2009 because it decreased A LOT
- hk-im-ad 5y agoMany people’s view points are influenced heavily by the 2008 financial crisis, which was a exceptionally rare and historic event. Demand for housing was artificially inflated due to fraud. Do you think demand is being inflated now? If so, by what, and what would cause demand to shift back? One possible answer is interest rates being low. However, the trend in interest rates towards 0 / negative has been going on for over 100 years. I don’t see them going up significantly ever again.
- rastafang 5y agoyeah, I tripled my "investment" in 10 years, I might be biased... the only thing I regret is not getting a more expensive home
- ric2b 5y agoAt some point they can't go lower because it becomes cheaper to store physical money than to pay negative interest rates, so it will stop somewhere.