Many players in the real estate market are left in a shambles. It is essential now to seize the opportunities that arise.
There are times when the wheat is separated from the chaff in the economy. Entrepreneurs are divided into those who bury their heads in the sand, those who want to make ends meet, and those who see an opportunity in the current transformation.
An example of this process can currently be seen in the real estate industry. The problems are large and diverse. Hardly any real estate entrepreneur – whether project developer, asset manager, or broker – does not open a conversation at the moment with concerns about excessively high-interest rates, politics, or the multiple crises of this time. However, some entrepreneurs show courage and foresight for the future.
Private real estate investors should take this as a guide. They usually plan more independently of short-term trends anyway. This is recommended now more than ever: The fact that real estate is fundamentally a good building block for building wealth has not changed. The scarcity on the market, which is expected to worsen, will soon drive prices up again. At the same time, however, it is important to check whether your property is future-proof thoroughly – the necessary investments in energy efficiency are particularly important.
To say it straight away: many players in the construction industry still have a rocky road ahead of them. Many of them are faced with real shambles and have had to give up. Almost overnight, hundreds of project developments became unprofitable. The problems with new construction cannot be explained away and are becoming a social issue. Given this, some take refuge in cloudy slogans such as “Survive Twentyfive”, “Twentysix, it won’t work before that” or “Twentyseven, back in Heaven”.
The perseverance slogans in English can hide it more poorly than well: hoping and pushing through is not and was not a strategy or a business basis for continuing under fundamentally changing conditions. Every strategy needs an anchor.
Politics has frozen. It can’t be investors
At the moment, every good strategy comes with the admission that the good old days are over and will not come back. The current situation should therefore be an opportunity to carry out an in-depth analysis and to reposition yourself strategically and mentally: How can the expertise that has been built up over the past few years be redirected? What options are available? Where are the opportunities? Given the crisis in new construction, politics appears weak and powerless. The political scene appears to have frozen. This shouldn’t happen to entrepreneurs.
Every company has to change the mindset itself. It would be presumptuous to give woodcut-like tips. Following trends will fail in individual cases. There are already pioneers in terms of new strategies: the project developer who has said goodbye to traditional residential construction and is now renovating existing buildings and also planning systems in the field of renewable energies. The property developer, who has previously counted luxury housing construction as one of its core competencies, is now building micro-apartments. Or the investor who has recently started looking for socially subsidized housing instead of privately financed housing because these are more profitable with various funding programs.
A strategic realignment also requires persuasive energy, because it is important to take your own employees with you – at least those who also want to take new paths. Young, enthusiastic people in particular do not want to work in a company that only relies on the principle of hope and perseverance. Those with a top education in particular demand leadership, vision, and enthusiasm: otherwise they will move on – to the next company, to the next city, to another industry, and perhaps even abroad.
My question is therefore: Are we fighting against decline or for a new upswing, for new growth after the bottom? It is also up to our important industry to become a role model for the entire country that believes it is in crisis with a positive mindset and new, perhaps uncomfortable, strategies.
Many investors see the existing real estate market as an opportunity market again. Cheap prices, lots of offers, high demand from users, and interest rates that are unlikely to rise anymore are brightening the climate. The already sharply rising rents are harbingers of a new era.
Many people understand this and take advantage of new opportunities in the market. And where is your opportunity market?
