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Millions of German renters will have to prepare for a steeper rise in house prices: Germany’s largest real estate company, DAX-listed Vonovia Group, believes larger rent increases are inevitable given higher inflation rates. in a sustainable way, hiring will also have to increase accordingly every year in the future,” Vonovia CEO Rolf Buch told the Handelsblatt newspaper. Otherwise, many owners would be in serious trouble.
“We cannot expect inflation to be transmitted through rents. It probably won’t work,” Buch continued. The real estate giant owns around 565,000 apartments, most of them in Germany. The average rent charged through Vonovia increased to 7. 40 euros per square meter in the first 3 months of this year, 3. 1% more than the previous year. This is still well below the current inflation rate of just under 8% constant.
Vonovia is unlikely to be an exception. Experts from the online portal “Immoscout24” expect hiring increases of six to seven percent in the next twelve months given the patience of peak inflation. the oil crisis of the early 1970s. Goods and expenses on average 7. 9% more than a year ago. In the European Monetary Union, inflation has even reached an all-time high of 8. 1%.
Representatives of the European Central Bank, along with its president Christine Lagarde, have since announced plans to raise interest rates and further reduce stock purchases this summer. So far, financial gatekeepers have kept key interest rates at traditionally low levels despite emerging inflation rates. , and even continue to charge interest to banks on their deposits in central bank accounts.
Image via Jens Neumann
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