Sharp rise in mortgage rates in Europe: property prices have started to fall.

What is happening in the housing market now was unimaginable just a year ago: apartments and houses that used to sell in a matter of days are now unable to change owners for months, and prices continue to decline.

Experts believe that the European Central Bank's interest rate hikes have led to a sharp increase in mortgage costs, reducing demand for housing. Mortgage prices in Germany have risen significantly over a short period and are likely to increase even more with the new rate hike.

Bubble index in European real estate markets

The Swiss bank UBS has highlighted several European cities where there are risks of 'bubbles'. The German city of Frankfurt am Main and the Bavarian capital Munich lead this list, indicating the possibility of falling property prices. Paris and London are in the average category, where property prices are inflated, but there is no 'bubble', analysts noted.

UBS analysts predict a 'significant price correction' in the real estate markets of cities with inflated prices and 'bubbles' in the coming quarters.

Decline in housing prices continues in major German cities

The brokerage company McMakler points to a prolonged decline in housing prices in Germany's largest cities. For example, in Stuttgart, the price per square meter of real estate decreased by 3.2% by the end of the third quarter.

Analysis by McMakler shows an increase in the supply of real estate in Bavaria and Hamburg, indicating a decrease in demand for housing in the region.

New restrictions in the German real estate market

The coalition in Germany is preparing a bill to ban cash real estate transactions, which will complicate the transaction process. This may impact the real estate market in the country, especially considering the decrease in housing demand due to high gas prices.

Source: Ukrainian service DW

The increase in the interest rate by the European Central Bank has led to a downturn in the housing market in Europe, which could cause price corrections and create risks of 'bubbles' in some cities. Germany is particularly affected by these changes, leading to low buyer activity and falling property prices in the country.