Pessimism Prevails over Financing Situation

In the second quarter of 2018, the German Real Estate Finance Index (DIFI) continues its downward trend. Falling by 0.4 points, the DIFI indicator now stands at minus 8.2 points. This drop can be attributed to a less favourable assessment of the financing situation which caused the corresponding indicator to fall by 9.5 points. With a current reading of 0.6 points, the indicator remains only slightly above zero.

In contrast, expectations regarding commercial real estate financing have improved. Despite this increase, the indicator still finds itself in negative territory. In the categories “offices” and “residential properties”, the assessment of the commercial real estate financing market has shown hardly any changes compared to the first quarter of 2018, leaving the corresponding indicator at minus 2.7 points. The market for retail property financing once again scores the worst rating: The corresponding indicator, which had already closed at a low level in the previous quarter, has now fallen again, reaching a new low of minus 32.8 points. As in the previous year, the indicator for logistics financing remains slightly above zero. This most recent survey shows, however, that the development of the refinancing markets has, on average, received slightly less favourable assessments compared to the previous quarter. These are the key findings of the DIFI Report, a quarterly survey on the commercial real estate financing market in Germany carried out by ZEW in cooperation with JLL.