Germany amidst an ongoing housing crisis
Real estate prices keep rising. As a result, high capital needs are now a real obstacle for new home buyers and real estate investors alike. Today, getting a home without a bank loan has become nearly impossible.
Why relying on banks is risky
Relying on banks makes the system fragile. When the economy turns down and interest rates have to go up, borrowers may run out of cash. Combined with higher unemployment, this could result in a disaster. It would hit not only the real estate sector, but also the whole world economy.
Even strong economies are struggling
It might surprise you, but even the most thriving economies have big problems with affordable housing. In a way, this is logical. These countries see the fastest growth in population, due to high birth rates and immigration. Both are a result of good living conditions and high life standards.
Germany is no exception. In fact, the country is Europe’s leader in lowest home ownership rates. Only about 46% of people own the home they live in.
Support programs are being cut
Germany has several laws and measures that try to even out the scales a bit. Demand currently outpaces supply by a wide margin, so home ownership is getting even more out of hand.
Some of these measures are support programs that back low-interest loans for housing cooperatives. They have been a good tool against the crisis. However, it was recently announced that this program will be put on hold for an unknown period due to budget cuts.
Beyond that, Germany is also seeing new cooperative building projects being called off. Loans are also being put on hold for projects that are already underway. This is a serious challenge, as it will leave many of these projects unfinished.
The system we mentioned earlier is starting to collapse. In that system, high prices make a loan an absolute necessity. The result will be fewer new apartments. That means an even worse housing shortage, with rents and property prices staying high on the open market.
More cuts for homeowners
Other support programs for private homeowners are also facing budget cuts. These cuts affect:
- energy upgrades of existing buildings
- conversion grant programs for elderly citizens
- special subsidies for housing companies, started because of the very high energy costs of the last two years
All of this is happening amid further cuts to new building projects. This will widen the gap between demand and supply.
Overall, it seems the government is failing in its attempts to control the housing crisis. This will lead to even higher prices in the future. In effect, prices would pass a point where reversing the situation would become nearly impossible.
Blockchain Property Gate: a glimpse of hope for real estate
Clearly, Germany and many other thriving economies must make major legal and economic moves to ease the housing crisis.
At the same time, new technology can offer clever tools that help in two ways:
- It can cut the cost of developing real estate projects by using resources more efficiently.
- It can make fundraising easier by lowering legal barriers and letting smaller investors take part.
This, in turn, could lead to lower real estate prices and a sector that is more open to all investors.
What Blockchain Property Gate does
Blockchain Property Gate is a new project built on decades of experience in the traditional real estate sector. It uses the advantages of blockchain technology.
Its mission is to provide a full method and technical framework for a more democratic housing market. That market would not depend on bank loans and rules to keep it in check. Blockchain Property Gate is starting with the German market and plans to take its disruptive model to the international scene.
The project focuses on the careful selection, purchase and renovation of properties. It follows a tried and tested method. The goal is to gradually buy real estate assets below average market prices. These assets can both generate steady cash flow and be renovated to raise their value in the short term.
The role of the BPGT token
This model is estimated to bring cost savings of between 20 and 30% for future homeowners, tenants and real estate investors.
The whole model is made possible by the BPGT security token. A security token is a digital token that represents a share in a real asset or business, much like tokenized real-world assets. The BPGT token does three things:
- It provides the capital the project needs.
- It rewards investors with the net profit made by Blockchain Property Gate.
- It ensures an easy entry into the real estate market, whatever your starting capital.
You can learn more about the mission of Blockchain Property Gate and sign up for the white list at www.blockchain-property-gate.com.
