The level of German property foreclosures fell by 15% in the first six months of the year compared to last year’s figures, as high demand for German housing helped put a floor under the most vulnerable section of the residential market, according to specialist publisher Argetra, which tracks the market.
The Ratingen-based Argetra, which publishes monthly figures on forced sales and auctions, said that given the strong current market, current foreclosure sale prices could be seen as a bargain. The falling sales figures were largely attributable to banks’s keenness to avoid foreclosure, while lower interest rates also helped troubled borrowers to refinance.
Measured by dates announced for foreclosure sales, the total number fell nationwide to 33,189 for the period, the lowest level seen for ten years. Heading the list geographically was North-Rhine Westphalia (8,143), followed by neighbouring Lower Saxony (3,466). The northern state of Schleswig-Holstein showed the strongest recovery with 26.4% fewer sales, with Hamburg down nearly 20%, while Bremen (up 1.9%) was the only state to register an actual increase in auction dates recorded.
The national average sales value fell by 1.1% to €155,500, only rising in the states of Baden-Württemberg, Schleswig-Holstein and Brandenburg. As valuations for this year’s foreclosures stem from 2007-2009, when the financial market crisis put pressure on valuations, today’s sales values can be assumed to be quite a bit higher in many instances given the strength of the market over the past two years. As such, conclude Argetra, current foreclosure prices are very favourable – with the number likely to continue falling, as any slack is being picked up more and more by direct sales.