Geschäftsbericht 2015, englisch

münchener Hypothekenbank eg | annual report 2015 management report 16 Strong demand for residential property led to a further intensifi- cation of competition in the residential property finance market in 2015. Banks within the Cooperative Financial Network, especially the Volksbanken and Raiffeisenbanken, were not only able to with- stand pressures posed by new providers, they were also able to once again strengthen their market position. According to statis- tics prepared by the German Bundesbank, they held a 21.9 percent share of market at the end of the third quarter 2015 – and were able to expand their share faster than other banking groups. Residential Property – International The economic recovery in numerous European countries had a posi- tive impact on the residential property markets. Strong dynamics was noted in these countries, which in turn was reflected in the development of prices. According to Eurostat, house prices in the European Union rose by 3.1 percent in the third quarter of 2015 over the same year-ago period and by 2.3 percent in the eurozone. These figures were influenced by countries posting above average high rates of growth like Sweden, Ireland and Denmark, as well as those with declining housing prices including, in particular, Latvia, Italy and France. For France this meant the continuation of a development that be- gan in 2012. On an overall basis housing prices fell moderately and are currently only about 4 percent below the peak level reached in 2011. Demand for residential property rose slightly in 2015 due to the slight improvement in France’s economic situation and the very low interest rates. Demand for new housing, in particular, exceeded supply. The shrinking level of new construction of hous- ing noted since 2012 contributed to this situation, which in turn led to a slight revival of higher purchase prices in this segment at the end of the year. The British housing market remained tight as demand stayed high due to the good economic situation and the low level of interest rates. As a result, prices for houses climbed by a notable 4.5 per- cent, although this gain was slightly less than the figure posted in the previous year. The supply of apartments tightened even further as the rate of new construction once again did not keep pace with the increase in population during the year under review. Further- more, restrictive lending practices meant that the volume of trans- action remained at the previous year’s level despite heavy demand. The first signs of a recovery in the Dutch residential property mar- ket were seen in 2014. The recovery gathered strength in 2015 as demand by owner-occupiers and investors increase substantially. Demand seen in the Netherlands was also driven by favourable economic development and low interest rates for mortgages. House prices also rose as a result and in the third quarter of 2015 had in- creased by an average of 2.9 percent over the figure in the same year-ago quarter. Nevertheless, sales prices were still about 16 per- cent below the peak levels seen in the record-setting year of 2008. Moreover, the growing deregulation of the rental housing market also contributed towards making the Dutch residential property market more attractive for international investors. However, as supply was relatively limited, the volume of transactions totalled about € 1.8 billion and was 20 percent lower than the level recorded in 2014. The strong rise in prices noted in Switzerland in previous years ebbed further in 2015. While the price of single family houses rose by 3.1 percent in the third quarter of 2015, prices for condo- miniums only climbed by 1.3 percent over same year-ago quarter. A certain amount of market saturation could be increasingly ob- served in this segment, although demand for property as a capital investment remained at a high level in light of the low interest rates and the lack of investment alternatives. The pace of increases in rental prices also fell slightly as prices noted in the third quarter of 2015 were one percent higher than in the same year-ago quarter. The Swiss National Bank noted in their 2015 Financial Stability Report that the imbalances in the mortgage and resi- dential property market did not rise any further. At the same time, however, they warned that the existing imbalances remained at a high level. Prices recorded in the residential property market in the USA rose further. The S&P/Case Shiller Index showed that prices for Novem- ber 2015 had risen by 5.8 percent over the same year-ago period. Notable regional differences were visible as Portland, San Francisco and Denver posted double-digit increase, while house prices in Chicago, Washington and Cleveland only rose by 3 percent dur- ing the same period. The nationwide rate of price increases, which was substantially higher than forecast, continued to be driven by low interest rates, favourable developments in the labour market as well as the tight supply of available housing. At the same time demand was very high, which led to a veritable seller’s housing

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