March 2009 Update
Welcome
 
Welcome once more to the monthly update from ProVenture. For first-time readers of this newsletter, we aim to give investors a quick overview to the property investment climate in Germany each month, share any “top investment tips” and highlight new property coming to the market. We hope it proves of interest.
 
Kind Regards,
 
Mat
 
Please click on the following titles to read the content or scroll down to read the whole newsletter
  
 
How is the global financial situation affecting Germany?
 
 
Rates come down
 
 
 
 
 
More tenants found than ever before
 
 
New RyanAir flights and where to stay in Leipzig
 
  
 
 9 Apartment building in Leipzig, Stoetteritz
 
 
Your Life in Property
 
 
 
 
  
 
German Economic Outlook
 
Germany, being the largest exporting country in the world, has been hit hard with falling orders for its high-end goods over the last month. Along with Japan, another major exporter, exports fell by around 50% in February. Exports of cars were particularly hit but the fall was cushioned by the German stimulus package which is now having effect. One part of the package is to provide a grant of €2,500 for all those who exchange a 9 year or older car for a new model. Consequently, 278,000 sales were registered in February (21% year-on-year growth) and car orders for delivery in next 3 months rose 63%. The effect of this and other elements of the package helped to curb the growth of the jobless. Unemployment still rose by 40,000 in February (from 7.8% to 7.9%) which was lower than expected and the lowest proportional rise in the Eurozone.

Concerning the Euro, stress between countries has risen this month with bond rates issued by nation states now varying by up to 2.5%. Weak economies such as Ireland and Greece are having to raise their bond rates to reflect the increased chance of default. This raises the spectre that Germany, Europe's biggest economy and the lowest bond rate, will stand in to bail out failed government bonds in an effort to keep the Eurozone together during its first big test.

Finally, and of greatest importance, was the ruling by the European Commission on the German pretzel. The humble pretzel was under threat by Brussels due to the fact that its high salt content was not clearly labelled on each pretzel. Fear not. The Germans won an appeal at the High Court and the snack can safely be eaten for some time to come, best taken with a cold beer apparently, although I wouldn't know.
 
 
 
 
Finance Update
 
Our links with our partner Bank continue to be positive for our client base and finance to 80% loan-to-value is still in place on most deals. As an alternative option for investors, we have also opened up a new link with an international Bank this month. This new link may prove useful to some clients, particularly the self-employed with erratic incomes or newly-formed companies. The bank will consider well-located property with a good level of rentals in place. Again, finance to 80% loan-to-value should be expected in the usual case.
 
Interest rates for both 5 and 10 year fix deals continued to fall during the month, with the latest indications being 3.9% for a 5-year deal and 4.5% for a 10 year deal. For those approaching agreement on finance or just for general interest, a good site to follow the rates that mortgages are based on (the so-called 'swap rate') is at:
 
http://www.swap-rates.com/EUROSwap.html
 
 
 
 
 
Activity on the Ground
 
In terms of sales, we took one apartment block to contract in February and placed 5 offers on property. Three apartment blocks will go to completion in March. Inspection trips are booked for every week in March, indicating the warmer weather may be bringing some “fair weather” investors back out! At present, the areas to the west of Leipzig (Lindenau, Kleinzschocher and Plagwitz) are getting a lot of interest as are the properties we have in Berlin.
 
On the rentals side, Septima had one of their busiest months in their 12 year history, signing 25 new rental contracts. The rental department is growing to meet the increased demand.
 
Dates when both ProVenture and Septima staff are in Germany can be seen by clicking here
 

 
 
 
Top Tip – New RyanAir Flight Times and Where to Stay
 
 
Firstly, just to update you - RyanAir move to their summer schedule from 29th March 2009 for flights to Altenburg (Leipzig). That means that there are now daily flights from London Stansted: Weekdays at 5.40pm, Saturday at 1.55pm and Sundays at 9.20am.
 
RyanAir are also launching a new service between Edinburgh and Altenburg from 31st March 2009 – with 3 flights a week. This is great news and will hopefully allow the ProVenture team to work from Edinburgh during August – enjoying the Festival between meeting new clients, sourcing property and conducting inspection visits.
 
 
When it comes to staying in Leipzig during your visits to meet the team and inspect some potential investments, accommodation can be found to suit every budget.
 
We always recommend booking through a portal such as expedia and finding a hotel near or in the city centre. Our offices are just a short walk away from the main train station and by staying in the centre – you will be able to gain a feel of the vibrant atmosphere of Leipzig, with its impressive buildings, shops, restaurants, bars and cafes. You will also witness the investment being made into the city's infrastructure.
We would recommend the Westin Hotel Leipzig, for very comfortable accommodation and facilties. The Radisson SAS Hotel is also very well located and comfortable. The Holiday Inn Garden Court is well located and provides good value accommodation.
 


E-Book
 
For those of you who missed it, a free ebook has been published on the website. The E Book has been written to discuss the overall approaches to property investment, approaches that will prove successful regardless of the market conditions faced. A number of models are introduced to describe successful investment and property management strategies that we hope you will find useful. Also included are a number of links to websites that professional investors use day-to-day in determining areas to invest in. To collect your FREE copy, please click here.
 
 
 
 
 
Latest Property Offer
 
  
 PVSI 189
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