The real estate sector worldwide is in the doldrums. The other day, the real estate sector in China was caught in the red. Now the real estate sector in Germany is showing signs of going bankrupt. Consequently, several property buyers are expressing concern over their future. Valery Shivchenko saved money by working hard and buying a 2-bedroom apartment to fulfil his dream. But his dream remained unfulfilled for less than two years as Project Immobilien went out of business. Shivchenko invested his hard-earned money in the firm. Not only Shivchenko but also many others share the same fate. An increase in bank lending rates and an increase in the cost of building materials by twofold hit the real estate industry. Hence, several developers have gone bankrupt within 12 months. Several property buyers in Germany are raising a hue and crying over the bursting of the real estate bubble. Shivchenko said that construction activity in Germany has remained suspended since August. He lamented that all equipment, including cranes, was relocated elsewhere from here.
As the situation in the real estate sector is more or less the same across the nation, Chancellor Olaf Scholz held a meeting with important real estate developers and asked them to resume real estate construction activity. The realtors resumed activity and launched new projects, encouraged by the low lending rates on loans. The war between Russia and Ukraine came as a bolt from the blue to Germany. The war led to an increase in the cost of building materials, and the European Central Bank increased lending rates to cut down on inflation, pushing the real estate industry into crisis. Because of this, prominent realtor Vonovia, in a fresh development, suspended the project executing over 60,000 apartments. Out of every five realtors, one’s project is suspended.
