Quarterly Report Q3-2018
Euro Score stagnates in the third quarter

Dear readers,

this year’s EXPO REAL trade fair impressively demonstrated that the real estate sector is performing very well in all of Europe’s core markets. We have recently concluded a large number of transactions, and we had specific discussions about many more in Munich. The continued dynamism of the market is reflected in the development of our REECOX: The Euro Score has decreased by just 0.5 %, meaning it continues to maintain its historic high. Europe currently faces numerous challenges, particularly in the political sphere. However, with regard to the economy, all the signs indicate that Europe does not need to be concerned about the real estate sector at the moment, one of its most important industries. In the six markets we observe, the economic conditions are good to very good. And, following a successful EXPO REAL, we can say that there is a confident mood – in all locations and perhaps more than ever.


Your Sabine Barthauer

Contact

Ms Sabine Barthauer
Member of the Board of Managing Directors

Euro Score stagnates in the third quarter

After continuous positive development since mid-2016, the European Real Estate Economy Index (REECOX Euro Score) decreased for the first time in the first quarter of 2018. But the second quarter laid rest to the assumption of a general change in trend in the European real estate sector. There was again no clear trend in the third quarter. While the Euro Score displayed de facto negative development, the slight 0.5 % decrease suggests more of a stagnation than a downward development. Development also varied during the quarter: While the months of July (+0.5 %) and August (+0.5 %) were positive, there was a month-on-month decrease of 1 % in September, representing a comparatively negative trend. The REECOX Euro Score currently stands at 245.4 points. Considering the ambivalent development in the first half of the year, it remains to be seen which direction the REECOX Euro Score will take in the future. Even though there is an increasing number of negative signs, a clear trend cannot be determined. From a historical perspective, the European Real Estate Economy Index continues to maintain a very high level.

REECOX Eye Q3-2018

Deutsche Hypo Euro-Score

245.4

Germany remains on top

With the exception of Germany, the real estate economy indices for the countries included in REECOX displayed de facto negative development compared to the second quarter, although the development of many countries was closer to stagnation. In Spain the decrease of 3.8 % was comparatively significant. However, in September the real estate economy indices of all the countries observed presented a slightly gloomier picture compared to the previous month.

Change of Input Parameters and Real Estate Economic Situations
Δ Q3-2018 / Q2-2018

Country

Stock Index

Real Estate Economy Index

Economic Indicator

Base Interest Rate

Interest Rate 10-Year Government Bonds

REECOX Q2-2018 / Q3-2018
DE
eq
up
eq
eq
eq
eq
GB
do
do
up
upup
up
do
PL
up
do
do
eq
eq
eq
NL
up
do
eq
eq
eq
eq
FR
up
do
do
eq
eq
eq
ES
dodo
do
dodo
eq
eq
do