Tag Archives: german market

The world of UK investment, business and economics

So what’s going on in the world of UK investment, business and  economics?

UK Investment
Did you know UK investment is at a record high? Very little spread online about this. The ONS quietly released the latest figures for Gross Fixed Capital Formation (GFCF) which covers investment across the whole economy, public and private sectors, manufacturing, construction, services and extractive industries. investment grew by 1.1 per cent in the fourth quarter of 2017, to a total of £84.1 billion. This is contrary to the headlines and beliefs that investors have fled the UK following Brexit. It’s not received a lot of news but the FT (https://www.ft.com/) were one media platform that did report it. It would be extremely helpful to all concerned if the public could be fed less propagandist speculation about the future direction of UK investment and the economy, made by organisations which have already been embarrassed by the grim forecasts they made ahead of the referendum, and we got to hear rather more genuine economic news. The way forward with a balanced view.

UK Property
Punitive tax reforms, including the removal of mortgage interest relief, extra stamp duty and tighter rules around mortgage borrowing, are helping to drive landlords to exit the buy-to-let market in droves. We at Barrington Howe have noticed this trend with the number of investors looking to sell properties and invest with a hands off approach. See our buy to let guide http://bit.ly/buytoletguide. Many clients have opted for hands free higher yields with security with our UK investment products Empire Property and Godwin Developments. According to estate agent Savills, buy-to-let lending collapsed by 26pc last year, as diminished profit margins discouraged new investors from adding to their portfolios. According to research by comparison website TotallyMoney, which looked at 580,000 properties across England, Scotland, and Wales to find the areas that offer the highest buy-to-let yields, Liverpool was the most profitable locations for landlords.

UK Economy
UK Prime Minister Teresa May hints at increased taxes to fund the NHS. £20bn will be made available to the NHS over the next 5 years. How is that going to be paid? She has mentioned the public will pay. The Brexit “withdrawal bill” headed back to the House of Lords with a ‘Meaningful vote’ high on the agenda. The Government lost another vote meaning that there will be another vote in the House of Commons on Wednesday. MP’s will voting on an amendment that would give politician a “meaningful vote” on Brexit. This will mean if 21st January passes with no deal being struck Parliament should intervene to prevent the UK from “crashing out” of the EU without a deal.

Overnight, a risk off tone was maintained in the market overnight as concerns surrounding trade wars remain. The White House confirmed yesterday that the US will impose tariffs on an additional $200bn worth of Chinese goods. If we see China retaliates then it will escalate tensions further which could hinder global growth and confidence.

Later in the day, ECB President Draghi is due to speak at the ECB Forum on Central Banking. After his dovish comments last week, the market will be keen to see if he elaborates further. Looking at economic data, we are due to see the housing starts and building permits.

Germany
It is reported that the most new born babies have been born since 1997! The numbers have risen significantly for the fifth consecutive year according to the federal statistics office. So what does this mean? A major reason is the lack of affordable housing as well as not enough child care facilities!

The economic growth rate for Germany has been reduced to 2.1% slightly lower than expected. Dolphin Trust continues to go from strength to strength with further developments taking place in high growth areas in Germany. Germany still remain with a budget surplus over 36.6 billion euros! There still remains a sustainable upswing on German real estate markets thanks to the economic boom.

Whilst news is the usual up and down, our clients profits remain on the up. The average return based on client UK investment for 2018 to date is 12%.

Berlin Germany Property Investment

Germany Property Investment: strongest economy in Europe?

Germany Property Investment:  Why invest in the strongest economy in Europe?

Have you considered investing in German real estate?  When it comes to Germany Property Investment, it’s worth considering the numbers first.

 

 

Berlin is a German hotspot. It is still growing rapidly whilst its housing markets are developing just as dynamically. Rents and prices are rising and there is an increase in new development projects. These developments are fairly diverse with public housing corporations and private developers to exclusive city centre projects to international buyers.

Berlin’s economy and population are growing, rents and property prices are rising. The population has been growing at more than one percent a year without taking into consideration the refugees. In 2015 alone, the population increased by 48,000. This is expected to continue for the next 5-10 years. A healthy economic standard and employment demand all contribute to these numbers. The city is also very attractive, lots of amenities and space for all types of lifestyle, education, leisure, culture and creation.

It wasn’t long ago that by socio-economic standards that Berlin was below the other top six locations in Germany. Berlin is now catching up. The Housing Market Report Berlin 2017 shows that many of the stereotypes about the Berlin housing market are incorrect. The number of employees in the City has increased by 29% between 2205-2015. Unemployment has significantly reduced during the same period. Not to mention the GDP rising.

Around 15,000 new apartments are being built each year. This only accounts for 0.7% of the stock! Supply is still growing much slower than demand. Asking rents in Berlin have been rising for years too.

In fact new construction relaxes the market. Expensive apartments contribute to the highest level of segments in the market.  They in turn free up existing and more affordable apartments or provide housing for newcomers or first time buyers.

Take a look at the numbers for Germany Property Investment

400,000 new apartments needed every year to eliminate housing shortage

120,000 by which the target misses each year

4,400,000 apartments needed to be built by 2030 to meet demand

Number 1
largest economy in Europe

Number 1
export powerhouse

Number 1
Largest budget surplus in Europe

Do the signals look positive for investors considering Germany Property Investment?

Investment news germany

Investment News Germany September 2016

Investment News Germany September 2016

One huge German market is about to be hit by a perfect storm of zero-interest rates and low inflation

While low inflation can pose a problem for many sectors, it is helping to reinvigorate Germany’s housing market, Sean Darby and his team at Jefferies said in a note to clients on Wednesday (emphasis added):

A combination of firm wage growth, negative bund yields, dormant inflation and a booming current account surplus is allowing the German real estate market to reflate. In comparison to Western markets, the German property market starts from a much lower base and also relatively favourable price comparison. We are bullish on the real estate sector as well as the DAX.”  To read more click HERE

GERMANY REMAINS THE DRIVER OF EUROZONE GROWTH

Germany, the Eurozone’s largest economy, grew 0.4 per cent, compared with an impressive 0.7 per cent growth rate during the first three months of the year, albeit that was a better result than expected. Growth was supported by net trade as well as private and government consumption, according to Destatis, the German statistics office. The second-quarter expansion took year-on-year growth to 1.8 per cent on a seasonally adjusted basis. The unemployment rate stands at 4.2 per cent, the lowest level since reunification in 1990 and one of the lowest rates in the European Union. The labour market has now little slack and is set to tighten even further as the baby-boom generation retires.

Strong Domestic Growth Keeps Germany’s Economic Outlook Upbeat

There have been some notable external risks mentioned in the economy because the British vote to leave the EU may still have some ripple effects. Some uncertainties exist because there may be some downsides that may not be experienced immediately but will only be realized when it is too late. The German finance ministry mentioned that there have has been slower economic growth than had been expected in the three months ended in June. To read more click HERE

Further Investment News Germany. Dolphin Trust Project Update: Windorferstraße, Leipzig
As Dolphin Trust goes from strength to strength as an investment, we can provide details on one of the projects our clients have invested in. The city of Leipzig is also known by the Leipziger Messe, which is one of the oldest trade fair venues in the world and its tradition dates back to the year 1165. The most famous one is the annual “Leipzig Book Fair”. With a settlement of international renowned companies such as Porsche AG and the BMW Group, Leipzig is an attractive business location as well. The existing infrastructure with efficient transport routes such as the airport in Leipzig / Halle, modern offices, commercial and residential buildings suggests that Leipzig as a great city for economic growth.

The building is located in Kleinzschocher area and was built in the second half of the 19th century. It was the residential and commercial building of cigar manufacturer Gustav Boehme and was one of the first new buildings in the street. Dolphin Capital redeveloped the listed building from 2015-2016. Extensive work at the façade as well as at the historical stairwell were made to complement the modern furnishings of the refurbished apartments.  See this project in more detail HERE

The Dolphin Trust investment opportunity can be found here https://www.barringtonhowe.com/product/dolphin-trust-gmbh/