The strong fundamentals of Germany on the one hand and global risks on the other hand, combined with the continued extremely low interest rates should contribute to a further capital flow into real estate. For 2016, we expect a transaction volume of again clearly more than €50bn.
However, the achievement of above-average yields is becoming increasingly difficult, since the decline of net initial yields is expected to be lower than in the recent years.
If compared to the last peak of the investment market, risk aversion is still comparably high. As a consequence, investors are focused on real estate of the risk classes core and core-plus.
Source : Savills