The crisis in the real estate market is worrying banks. It is feared that quite a few people could get into serious difficulties as a result.
The main reason for the drop in prices is increased interest rates, which make real estate financing more expensive. Many people can no longer afford to buy, and investments are no longer worthwhile for large investors. Prices have been falling since mid-2022, according to the Association of German Pfandbrief Banks (VDP) The VDP recorded historically strong declines at the end of 2023.