By John O’Donnell

FRANKFURT / Reuters – A three-bedroom, 47-floor apartment for €10 million is being offered by the Frankfurt Real Estate Company. It can be seen above a dull office area in downtown Frankfurt.

German’s financial centre is often called “Mainhattan” because of its location along the Main River and skyscrapers. Although it may not be as vibrant and culturally diverse as New York, New York was able to surpass it in 2021 to become the most valuable real estate bubble index.

A majority of Germans have bought a home or an apartment after long avoiding property ownership.

Frankfurt is witnessing 18 new high-rises spring up, one of many building frenzy examples in Germany. Prices have risen to record levels, and houses are now more expensive than ever.

Frankfurt placed ahead of New York City, Hong Kong, Toronto, and Toronto in UBS’ bubble rankings 2021. Munich was also close to the top.

Since the middle of 2019, German property prices have been rising faster than most of Europe. In fact, house prices rose more than 10% during the second quarter 2021 compared with a year ago.

This demand was highlighted by German insurer Allianz, (DE:), and a local pension funds this year that paid 1.4 billion euros ($1.6billion) each for one of the four skyscrapers being built in the capital.

FOUR stands for Four Offices and Two Bedroom Apartments. It is priced at around 3 million Euros.

Developers behind the project claimed that the area was being targeted. This city is among the most wealthy in Germany. The demand confirmed that this approach was right. There is no bubble.”

There has been an increase in interest. However, the coronavirus has turbocharged property investments. Traditional savers from Germany have now had more money and their deposits are being hit with negative interest rates.

In 2006, less than 42% Germans had their own homes. However, that number grew to nearly 47% during the financial crisis.

The latest Bundesbank data shows that borrowing money to buy properties has increased in speed since the pandemic. The value of home loans reached 1.45 trillion euro at the end 2020. This is roughly 6 percent more than one year ago. Data for this year also shows that this borrowing continues to grow.

“SKY IS NOT THE LIMIT”

While the current pandemic reduces immigration and strengthens tenant protection in Germany, as Germany’s population shrinks faster than ever, observers believe that the seeds are being planted for property prices to rise.

The Bundesbank warned November about the dangers of an overheated real estate market and warned that they could overvalue it by up to 30%

We need approximately 220,000 immigrants to maintain stability in the country’s population and property demand. Jochen Moebert is an economist who has seen immigration take a beating from Corona. Deutsche Bank (DE:) According to research, net immigration dropped from 400,000 prior to the pandemic down to 220,000 last.

Moebert predicts this along with tighter regulations to make homes more energy-efficient and rent control, could lead to a boom in the property market by 2024.

He said, “We are reaching the top.”

Barbara Steenbergen, International Union of Tenants stated that pandemics have tightened control on European property investors. They prevented foreign buyers from buying ordinary houses in Amsterdam or elsewhere.

She said that the markets are increasingly regulated in Europe for investors.

Frankfurt is showing signs that things are changing. Plans for an apartment tower with a Porsche-branded design have been dropped.

Local officials believe that the top has been attained.

According to a spokesperson from Frankfurt’s planning division, “The sky isn’t the limit for property values.”

We have enough for luxury apartments.