The real estate industry is doing well and it expects interest rate policy to keep encouraging the boom. Germany is the most popular market by a distance, there is great interest in healthcare and care properties, digitization is gaining in importance, Brexit is taken with composure—and financial policy and economic policy should be more strongly coordinated in the EU. These are the core statements from the first EXPO REAL barometer of opinion.
“1,575 trade fair participants on decision-making level took part in the online survey”, says Klaus Dittrich, Chairman & CEO of Messe München. The opinion research institute IfaD conducted the survey in July on behalf of the trade fair. “EXPO REAL is the leading network for the European property industry. With the survey, our aim was to get a true reflection of opinion and the mood of the sector.”
The EU should coordinate financial and economic policy more strongly
The EXPO REAL barometer of opinion shows that the property industry is favorable towards both the EU and the euro. A dissolution of the EU and a return to national currencies are regarded as undesirable by over 90 percent of the respondents. On the contrary: the overwhelming majority (84 percent) are of the opinion that a coordinated financial and economic policy would be preferable, and more than half (58 percent) are in favor of an EU financial budget and one EU minister of finance.
Relaxed on the subject of Brexit
While the decision for Brexit set off some shock waves at first, the situation has clearly eased in the meantime. Only one fifth of the companies surveyed feel direct effects, 13 percent have adapted their strategy to the circumstances. As against that, the majority are carrying on their business as usual and are completely unperturbed.
Positive estimation of the future trend in interest rates
The low rates of interest have been a driving force for positive development on the property markets. Here the overwhelming majority of respondents (97 percent) do not expect a radical change this year or next but rather a moderate increase at the most—and the general view is that this can be absorbed by the market without any great disruptions.
Digitization is gaining in importance
While the real estate industry is regarded as rather conservative, the respondents almost unanimously (91 percent) see potential for digital products and services; in addition, almost one half (47 percent) are already offering these products and services. Almost as high (44 percent) is the proportion of those who are working together with specialized technology companies or start-ups to develop new business models. In other words: the digitization of the property industry is forging ahead.
The top 10 most interesting markets for investment
For the respondents, the European markets and the USA are clearly to the fore as investment locations. It may come as little surprise that Germany is topmost, followed some way behind by its neighboring countries Austria and Switzerland as well as Benelux. On a par are Central, Eastern and Southeast Europe and France. These are directly followed by the USA, Southern Europe, the Nordic countries and Great Britain and Ireland. And if you look towards Asia, China is the favorite.
Great interest in healthcare and care properties
The question about the types of property use that will gain most in importance reveals some clear favorites. Residential property is no. 1; if we were to concentrate the three segments of subsidized, “normal” and luxury living, the survey comes to a net value of as much as 85 percent. Healthcare and care properties are no. 2, logistics no. 3.
And still the boom goes on
Virtually all respondents assume that the sums of money invested in property this year and next will continue to increase or at least stay at the same level. So in general, the industry is still looking positively to the future.
The complete infographics of the EXPO REAL barometer of opinion can be found in the right column.