This is because more than half of all loans to households are loans for house purchase. [1] At 80%, real estate makes up the lion’s share of fixed assets in Germany. Our assessment of the real estate market situation is similar to that of last year: cyclical risks, to which the real estate market is making a significant contribution, are continuing to mount.
However, we see no need to activate borrower-based instruments intended to stabilise lending standards – in other words, a loan-to-value ratio and an amortisation requirement. How have we reached this assessment? House prices are an important indicator and have continued to grow sharply, rising by around 8% over the past year.