The trend of December 2022 and January 2023 has reversed - the mood on the real estate market has deteriorated again. This is shown by Deutsche Hypo's Real Estate Climate Index: in February 2023, it fell, albeit only slightly, by 2.2 percent to 74.1 points. According to the experts, the investment climate declines the most by 4.4 percent - in February to 53.2 counter points. This was due to the interest rate hikes by the European Central Bank (ECB) to date and those still expected. According to the index, the earnings climate recorded a decline of 0.8 percent - and at 96.7 index points was still higher than at the end of 2022.
Of all asset classes, hotels suffered some of the greatest setbacks: The climate fell by 8.9 percent to 72.2 points, as the Hypo experts determined. Only the residential sector is exempt from the poor mood, where the climate rose slightly by 0.8 percent - and managed to jump above the 100 mark.
Deutsche Hypo said it expects interest rates to rise slightly by 50 basis points in March. In the medium to longer term, interest rates have recently stagnated at the level of the previous months, according to the experts' observations. Overall, the real estate market thus appears to be emerging from its state of shock and becoming somewhat more buoyant again.
More affordable housing - thanks to new proposals from the Mittelstands- und Wirtschaftsunion (MIT), this should become possible. And it should also bring the German government's goal of building 400,000 new homes per year one step closer.
Among other things, the MIT paper proposes that the regulations for new buildings be streamlined and that the renovation of existing buildings be promoted. It is also planned to make it easier to build in city centers and on brownfield sites. Incidental costs are also to be reduced. For example, the first owner-occupied home could be largely exempt from real estate transfer tax. In cooperation with the municipalities, more building land is to be obtained - especially on brownfield and conversion sites.
The federal government has extended energy conservation rules through April. Although gas consumption was recently 17 percent below the average consumption of the years 2018 to 2021, it still increased compared to the early weeks of the year (as of the end of February 2023). With the war in Ukraine also still ongoing, the Bundesrat approved the extension of the measures until April 15, 2023, despite well-filled gas storage facilities and comparatively mild temperatures.
The EnSikuMaV has been in force since September 2022. Behind this gigantic acronym hides the "Ordinance to Secure Energy Supply through Measures Effective in the Short Term." This would have expired on March 1, 2023, after six months. For private properties, however, the regulation will continue to apply for the time being, among other things:
Clauses prescribing a minimum temperature in apartments are currently out of force. Tenants must nevertheless prevent heating and ventilation damage to the property.
Private swimming and bathing pools may not be heated.
Gas suppliers as well as property owners must inform customers or tenants at an early stage - about expected energy consumption, costs as well as savings opportunities.
In addition, the Ordinance on Securing the Energy Supply through Measures Effective in the Medium Term (EnSimiMaV) has been in force for 24 months since October 1, 2022. For public, private and company buildings applies under this regulation:
Annual heating inspections for buildings with gas heating systems are mandatory. Among other things, lower flow temperatures and setbacks at night are to be set.
Hydraulic balancing for large buildings with central heat supply by natural gas is mandatory.
Inefficient heating pumps with natural gas heating without control must be replaced.
The energy price brake will take effect on March 1. This will also apply retroactively to the months of January and February. The cap on prices for private households and small and medium-sized companies will initially apply until the end of the year. By decree, the German government can order an extension until April 30, 2024. Consumers do not have to do anything else to benefit from the price cap.
The gross energy price, including taxes, levies, surcharges and network fees, will be capped at 12.0 cents per kilowatt hour for grid-bound natural gas and at 9.5 cents per kilowatt hour for local and district heating. The cap on electricity prices is 40 cents per kilowatt hour. The strike price applies only to the 80 percent of annual consumption forecast in September 2022 for a maximum of 30,000 kilowatt hours per year. The remaining 20 percent is waived, for which the regular contract price is paid.
If consumption exceeds 30,000 kilowatt hours, only 70 percent of consumption will be capped by the energy price cap. In addition, the VAT on gas has been temporarily reduced from 19 to 7 percent. This applies for the period from October 1, 2022 to March 31, 2024.
Furthermore, subsidies can be applied - if heating oil, liquid gas or pellets were purchased between January 1, 2022 and December 1, 2022. The prerequisite for this is that the price has at least doubled compared to the previous year. A receipt is required for proof. The subsidy covers up to 80 percent of the additional expenditure up to a limit of 2,000 euros, and there is also a de minimis limit of 100 euros.