Sun shining in Leipzig

As I sit here in the office with the glorious sun beaming down ou tside and having just got back from a great inspection visit (the weather is beautiful in Leipzig at the moment too), I'd like to welcome you to the monthly update from ProVenture. We hope you find this short newsletter of interest and that it keeps you up-to-date with the property investment scene in Germany.

German Economic Outlook Confusion continues to reign on the international money and equity markets, but stability over the summer (well, compared to last summer)is looking more likely.

In an attempt to reduce interbank lending without reducing the headline interest rate, the ECB inject a huge amount of ?new money? into the system this month. The ECB pumped a record ?442.2bn into the eurozone banking system in a f irst offer of unlimited one-year funds as it battled continental Europ e's severe recession. The effect has been to see the lowest ever lev el of short term lending (LIBOR) for the Euro and a dramatic easing in credit conditions. It will be interesting next month to reflect on this recent move and determine what the effects on longer-term lending has been in particular.

Concerning Germany, German business confidence has brightened more than expected this month with companies in Europe?s largest economy becoming markedly more upbeat on prospects for the next six months. The Munich-based Ifo insti tute reported its closely-watched ?business climate? index had risen for the third consecutive month, from 84.3 in May to 85.9 in June to the highest level since November. The Ifo conclude that this is usua lly consistent with a turning point in recessive conditions. An interesting article regarding Germany's economic position as we maybe turning the corner in the recession (written by the head European economics at Bank of America Merrill Lynch) is at:

http://www.ft.com/cms/s/0/c21fb0d2-551f-11de-b5d4-00144feabdc0.html

For Sterling-based investors, some good news this month was the continued softening of the Euro which currently stands at 1.18 Eur:GBP, and has nearly reached 1.20 over the last few days.

Finance Update

Rates on the longer-term fix mortgages are starting to drop once more from their recent (relative) highs. Due to the effective quantitative easing measures in the Eurozone and also a revised view on any imminent inflation rate increase, rate s have dropped around 0.1% this month and are tipped to continue to fall by a number of bankers interviewed this month. Favourable loan-to-value finance is still available for our clients up to 80% of the property value or purchase price paid.

The swap rate is at:

http://www.swap-rates.com/EUROSwap.html

Activity on the Ground

June has been a great month in Germany. I am sure the weather helps in this job (I remember walking the lonely streets of Leipzig alone in February, taking pictures of properties covered in snow). We have had offers agreed on 3 properties (price range 300 ? 500k) and have a full viewing sche dule booked for July.

We have also been very busy bringing new properties to the market, in Leipzig, Halle and Berlin. The links at the bottom of this e-mail will take you the new properties for your research and interest.

Top Tip

Property Finding Service For many of our clients who do not find exactly what they are looking for on our website offers, we offer a bespoke property finding service. After a consultation by teleph one, email or face-to-face, we will search the market on your behalf f or property which fits your investment objectives. Typically this search would include:

* Property Location (city)

* Type of location (tenant type, relative wealth and character of area)

* Price Range

* Price per sqm

* Target yield

* Mix of residential Vs commercial

* Level of refurbishment, if any * Year of construction / when last refurbished

Once we have your objectives, we can make use of the range of our connections and suppliers to determi ne if that property is out there. Please let us know if you would like us to conduct such a search of the German market on your behalf. The service costs nothing and we really enjoy successfully matching client objectives to new properties to the market where we can. Please check the website for all our new property offers in the cities of Leipzig and Berlin.

Finally, please enjoy the summer weather, be that on a beach or on a street looking at your next property investment. Happy investing, Mat