Housing prices in German cities have been rising so strongly since 2010 that a possible overvaluation cannot be ruled out. This is the finding of an article contained in the Bundesbank’s most recent Monthly Report. According to this article, there are no signs of substantial exaggerations in the housing market as a whole. Nevertheless, price rises have been observed in urban centres, in particular, which “are difficult to justify based on fundamental factors”, the Bundesbank says.
Link to Full Article.
Link to Financial Stability Report.