The market for premium residential properties in Hamburg and on Sylt Island has recently been marked by reduced demand and greater supply. This observation comes from André Wales, sales manager Premium Real Estate Hamburg and Torsten Paulsen, sales manager Premium Real Estate Sylt, of Grossmann & Berger Immobilien. Today the real estate services provider publishes all the relevant developments and the G&B Property Price Trend* in its first market survey “Premium residential Hamburg and Sylt.”
Hamburg: Greater supply of premium properties
As a result of interest rate growth, the Hamburg home-buying market has seen a considerable shift in the relationship between supply and demand for premium properties: whereas there used to be a shortage of properties, potential buyers now have far more choice. Selling prices have dropped in each of the city’s prime locations, and properties can now be on the market for as long as eight months before a buyer is found. At present, potential buyers have appreciably more scope to negotiate and opportunities to place offers. The energy efficiency of the property is becoming an increasingly important sales argument. As Wales says, “In order to sell a property these days the asking price has to take realistic account of the costs of any necessary modernization work. Home-buyers in the premium segment have definite ideas about the kind of property they wish to purchase. In particular, its location, state of repair and fit-out must meet their personal criteria. When that is the case, properties still sell for high prices.”
Sylt: Owners convinced of the stable value of property
In recent years demand for premium properties on Sylt Island was very high thanks to the all-time lows in interest rates. Demand on this market also slackened appreciably when interest rates pushed up borrowing costs. At the same time, the supply of properties began to grow. Market activity declined and the average time required to complete a sale rose to between eight and twelve months. In 2023 prices for real estate in exclusive parts of Sylt remained more or less unchanged. However, prices for older properties in less desirable locations and in need of refurbishment dropped appreciably. Paulsen explains that, “To date many owners, being under no pressure to sell, show little willingness to accept the new price environment. Currently, they are more likely to adopt a wait-and-see attitude, convinced that Sylt will not lose its status as a popular holiday destination and that lower interest rates will boost demand again.”
* G&B Property Price Trend Hamburg:
Estimated prices buyers will pay for standard properties in a very good neighbourhood with premium fit-out | Standard town villa: good condition, at least 350 m² of living space, plus ancillary space, at least 350m² of land | Standard apartment: empty, very good condition, at least 180 m² of living space, at least 4 rooms, balcony, elevator, built-in kitchen
* G&B Property Price Trend Sylt:
Estimated prices buyers will pay for standard properties in a very good neighbourhood with premium fit-out, permission to let out to holiday-makers | Standard house: detached or semi-detached, good condition, at least 150 m² of living and ancillary space, at least 5 rooms, at least 500m² of land | Standard apartment: empty, very good condition, at least 60 m² of living space, at least 3 rooms, balcony, elevator, built-in kitchen
The Market Survey Premium Residential Property Hamburg and Sylt 2024 may be downloaded from the G&B website.
