Strength of German Real Estate Stocks
German real estate stocks have proven to be robust winners in a weak market environment. Particularly in cities like Berlin, Hamburg, and Cologne, the demand for rental apartments remains extremely high, supporting the stability of residential real estate stocks.
1. Demand for Residential Real Estate
The consistently high demand for rental apartments contributes to the robustness of real estate stocks, as they are less affected by global economic fluctuations.
2. Profit Growth from Rent Increases
Companies like Vonovia benefit from rent increases and report significant profit gains, with a notable profit of 515 million euros in the first quarter of 2025.
3. Investments in Renovation and New Construction
After a phase of restraint, investments are flowing back into the renovation and new construction of real estate, promoting growth in the sector.
Market Environment and Comparison to Banks
1. Weak Market Environment
Although the market environment is weak, German real estate stocks have maintained and even expanded their position while bank stocks have been under pressure.
2. Interest Rate Development
The return of interest income on bonds supports real estate values and reduces the attractiveness of bank stocks.
3. European Industry Trend
While the European real estate market shows a mixed trend, German real estate stocks stand out positively.
Relevance for Private Investors
German real estate stocks offer opportunities for portfolio diversification and are characterized by stability in challenging times. The long-term prospects through investments in renovation and new constructions underscore their value for private investors.