Berlin’s ‘Bubble’?

“Prices have risen, for residential properties, by almost a third, in the past five years.
In fact, George Soros has warned of a property bubble…
Not the view of the local real estate agents…
Apartments yield an average of 5 to 5.5%.”

– from ‘Could Berlin Be In A Property Bubble?’, Bloomberg, 28 Oct 2012

In Vancouver, we know that prices have to double or treble, and yields have to reach real-negative numbers, before you can really boast of having a bubble. What’s German for ‘wussy’? Try harder, Berlin.
– vreaa

22 responses to “Berlin’s ‘Bubble’?

  1. UBCghettodweller

    Perhaps things have changed, but until recently, sales where discounts at stores are more than 5 or 10% were a rarity. Germans work a set number of hours. Working more than your allotted hours doesn’t go over well there. It’s all a hang over from the post-war economic miracle where stability and organisation were key. So very German. The German post-doc in my lab embodies this exactly. God help him if he has to work more than 50 hours in the week (remember in the sciences, 60 bench-work hours a week are the norm) or if he has to do anything other than being a soft-handed academic. He was floored that I wheeled at dealed with sales reps from reagent and equipment suppliers to get discounts on some commonly ordered items for the lab or that Staples would price match online Canadian retailers that had external hard drives on sale if you just asked. He was shocked that you could do that… that such economic flexibility was possible.

    A third increase would shock the Germans surely.

  2. It’s hard for a bubble to to develop there because when they run out of land they annex some more.

  3. “What’s German for ‘wussy’?”

    I think the word you are looking for is “Waschlappen”

    • Hmmm… is that a synonym for “BitzhenSchlappen”?…

      “If we learn from the U.S. experience, we should be cautious, even if we up to now aren’t in a bubble,” said Kai Carstensen, an economist at the Ifo Institute in Munich. “When I talk to politicians, they always say, well, it’s different. That’s what you always hear; this time is different.”….

  4. Germany is yield chasing like everyone else, major trading partners are in recession.

    • perceptive+ … if everyone is chasing yield, what does that say about those assets … try harder? … that’s what 6 rolls of rusty’s royale soft said … pfffft!

      • Lots of good assets out there IMO. In my view people are “chasing yield” on these poorly-performing assets because they are not fully accounting for risk.

      • care for a stroll among the shadows? … almost everything is expensive, some of it obscenely expensive … people chasing anything are hurrying on their way to being financially decapitated … only conviction is that the counterfeiting (stealing) will continue … and at some point, it gets bad enough that people figure it out and so it stops working … then, what? … why not indulge further in a dream? … say a few more years of austerity, unemployment, violence, dissolution of social fabric in greece, spain, wherever next … to the point where nearly everything is dysfunctional … then, hey wow! this permanent martial law and foreign currency we have no control over is great … so much better … otoh, they could just all default now and wipe out huge chunks of pretend wealth everywhere

      • ” almost everything is expensive”

        In my experience, things never — well, almost never — look cheap, and when they do people start to think they smell a bit “off”.

        I’d suggest another tack. Look through periodicals and (reputable) science magazines for some insight into how the world is pouring billions of dollars into meaningful basic research and then development, enough to keep the economy moving for a while longer. I for one am not worried about finding a job for the next generation at least, even in war I’ll be getting paid.

      • in the worst times, there remain opportunities to do things you don’t want to … some pay primo … though perhaps, i’d deduce this is the definition of prostitution … ok cheer up time – got my coffee finally

  5. Germany’s bubble is just getting underway. It will be interesting to see how it affects their opinion of the ECB. Maybe they will love it 🙂

    • Rusty's Historical Gravitas

      Oh, great – that’s exactly what the world needs – Another episode of German Irrational Exuberance. We all know how well it worked out the first two times.

  6. Double or “treble?” Geez, what has the Internet done to people?

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