The past years have been very successful for the German real estate market. The question arising is what will happen in the next years. Will rents and sale prices rise even further? Or is a depression coming after the heyday? The spring report of the German real estate magazine “Immobilienwirtschaft” shows the pessimistic estimation of the real estate research provider Empirica. After that, Bulwiengesa, another leading consultancy in the real estate sector, contradicts in a different report. Let’s have a look at the arguments.

End of Exorbitant Sale Prices, End of Cycle of Rents

First of all, Empirica claims the declining rise of sale prices for condominiums. In 2017, the prices increased by 7,9% which is a smaller growth than one year before (8,8%). Here, they see a weakening cycle of sale prices already lasting for 8 years now. Moreover, Empirica identifies the declining immigration combined with the increasing offer of apartments as a reason for the slow-down of the price increases. In 2017, about 300,000 apartments emerged. This year, the amount is even expected to rise. Also, Empirica anticipates an end of the exorbitant sale prices with a plus of up to 30% in A-cities. Particularly the wave of new apartments could exert pressure on the prices. Empirica states an expected decrease of the purchase prices of one quarter to one third in Munich, Berlin and possibly Stuttgart.

Bulwiengesa Questions the Influence of Immigration and Building Permissions

Bulwiengesa goes into two main points in their reactionary report: The influence of immigration and the amount of building permissions on the sale prices and rents. They see a persistent momentum in the central cities due to attractive possibilities to earn a living, stable economic circumstance and various offerings for leisure. In addition, even during the weak years of 1994-1999 no adjustment of prices have occurred. Moreover, not every building permission is necessarily connected to a building completion. There is still demand for housing space. Also, Bulwiengesa criticizes the general relation of supply surplus and the decrease in prices: “We do not expect a decline in the prices in Berlin-Mitte because of empty apartments in Spandau.”

Consensus About Cycle of Real Estate Markets

Both, Empirica and Bulwiengesa agree on the fact that the German real estate market is cooling down. In doing so, Bulwiengesa refers to the German Property Index. They state that the moment and the extent of the slow-down of the real estate market depends on the level of interest rates and the real economy, though. Here, we agree with Bulwiengesa: These days, yields that are scarcely below the level of interest rates are accepted for building. An increase in interest rates would put the market under pressure. However, the salient point is the state of the German real economy.


Hedge Funds: The Strive For Absolute Returns By Taking High Risks

Hedge funds are investment funds that pursue various investment strategies and manage diverse types of assets. In general, they aim to generate high positive returns regardless of whether markets are rising or falling. In other words: they strive for absolute returns. Therefore, these funds invest more actively than others and tend to use more aggressive investment strategies and positions in order to improve their risk-reward-balance. Not everyone is able to invest in hedge funds. Only sophisticated or accredited investors have access to these investment funds. As these funds are not publicly accessible they can avoid regulatory oversight to a certain extent and, therefore, can operate more flexibly. Learn more about the top hedge funds with our exclusive Top 50 Hedge Funds Worldwide List, the unique and detailed overview of this complex field.

Many family offices chose this type of investment funds to invest their high amounts of capital. Read below, why hedge funds are a suitable investment partner for family offices.

Why Family Offices Tend To Invest Their Money In Hedge Funds

Family offices manage the capital of wealthy families and transact different investments. Basically, they know how to handle high amounts of money. Moreover, family offices are expert players in the financial markets so that they are at a premium for hedge funds. Besides, they aim to operate discreetly and want to prevent public attention. In many cases, the families in the background of the family offices are rather unknown. As hedge funds operate with the same discretion, they are a suitable investment partner for family offices. In addition, family offices can benefit from the huge network of these investment funds in order to invest in the most profitable way.

In general, it is quite difficult to figure out the field of family offices due to their undisclosed actions. However, for many various firms it might be highly beneficial to address these firms. As they have a lot of money on hand and tend to invest in the long term family offices are valuable investors. Besides, family offices are qualified companions when looking for co-investors or partners in order to exploit new markets. By doing extensive research on this topic we aimed to shed a light on the most significant family offices. Discover our Top 150 Single Family Offices Germany and Top 150 Single Family Offices USA and many others. Good luck finding the perfectly suitable partner for your investments with the help of our exclusive Family Offices Lists!


George Soros And Ray Dalio Manage The Largest Hedge Funds РAnd Are Two Of The Richest Men In The World

The hedge fund managers Ray Dalio and George Soros manage the two largest hedge funds in the world. As founder of Bridgewater Associates, Ray Dalio is No. 67 of the wealthiest people in the world with an estimated net worth of US$ 17 billion (Forbes 2018). In total, Bridgewater registered a gain of almost US$ 50 billion which is the highest gain among all hedge funds. With about US$ 160 billion in assets under management (AUM, according to its website as of October 2017) Bridgewater is the largest hedge fund in the world. No. 2 of the largest hedge funds is Soros with a total gain of almost US$ 44 billion. Its hedge fund manager, George Soros, is at #190 of the Forbes list in 2018. His net worth is estimated US$ 8 billion after having donated about US$ 18 billion to his philanthropic agency, Open Society Foundations (February 2018).

What Is A Hedge Fund?

Hedge funds are investment funds that pursue various investment strategies and manage diverse types of assets. In general, they aim to generate high positive returns regardless of whether markets are rising or falling. In other words: they strive for absolute returns. Therefore, these funds invest more actively than others and tend to use more aggressive investment strategies and positions in order to improve their risk-reward-balance. But not everyone is able to invest in hedge funds. Only sophisticated or accredited investors have access to these investment funds. As these funds are not publicly accessible they can avoid regulatory oversight to a certain extent and, therefore, can operate more flexibly. Learn more about the top hedge funds with our exclusive Top 50 Hedge Funds Worldwide List, the unique and detailed overview of this complex field.

The Life Of Ray Dalio

In 1975, Ray Dalio founded the investment firm Bridgewater Associates, the world’s largest hedge fund since 2005. Bloomberg Markets ranked the hedge fund manager among the 50 most influential people in the world in 2011 and 2012. The German magazine “Stern” just published the article “This guy bets billions that Germany is going to crash” (March 2018) referring to Dalio’s controversial short bets against major German companies. In addition, the German “Manager Magazin” simultaneously wrote “The man who evokes the German DAX-crash“. Among others, publications talk about “The ruthless Mr. Dalio” (German newspaper “Frankfurter Allgemeine Zeitung”, in April 2016) and “Dalio versus everyone else” (Bloomberg, in February 2018).

Nevertheless, Ray Dalio engages philanthropically. With his Dalio Foundation¬†he supports different projects, such as Polio Eradication Projects, the New York Presbyterian Hospital and the¬†Fund for Teachers. Besides, his foundation is part of the TED’s Audacious Project engaging in social entrepreneurs working to find solutions for global issues.