Real estate - More foreclosures in Hesse due to rising interest rates
Wiesbaden/Frankfurt (dpa/lhe) – In Hessen, there were more houses and apartments forced to be auctioned off last year. According to the Real Estate Owners Association Haus und Grund Hessen, there were 1,949 new applications in 2023, a 15.7% increase compared to 2022. "We are looking at this development with concern," said Managing Director Younes Frank Ehrhardt. The good years for forced auctions seemed to be over. According to Ehrhardt, the number of applications had decreased by 6.1%, 4.3%, and 7.4% from 2019 to 2022.
"We attribute this trend to the significantly increased interest rates – and the difficult situation on the real estate market," he explained. High mortgage rates for new or additional financing have put some owners in difficult situations, whose property did not find a buyer on the free market and then went into forced auction. Haus und Grund Hessen represents the interests of over 68,000 members, who collectively own 84.5% of the total housing stock in the state.
The Hessian Ministry of Justice stated that a significant increase in forced proceedings for immovable property could not be detected for Hessen. "The figures for 2023 are significantly below those from 2014 to 2018 and roughly at the level of 2019 and 2020," explained a spokesperson. In 2014, the Ministry recorded 4,224 applications, which successively decreased to 2,548 by 2018. In the years 2019 and 2020, 2,026 and 1,901 applications were recorded, respectively. The spokesperson added that the numbers had been slightly declining in 2021 and 2022 (1,819 and 1,685) and had now slightly increased again for 2023. The Ministry of Justice considers the number of forced auctions of real estate to still be at a low level in the long term.
- Despite the increase in forced house and apartment auctions in Hesse last year, the Hessian Ministry of Justice reported a decrease in forced proceedings for immovable property.
- Managing Director Younes Frank Ehrhardt of Haus und Grund Hessen, representing over 68,000 members with 84.5% of the state's total housing stock, expressed concern over the 15.7% increase in forced auctions in Hesse in 2023.
- Ehrhardt attributed the trend to the significantly increased interest rates and the difficult situation on the real estate market, leading to high mortgage rates for new or additional financing.
- The Frankfurt-based real estate owner published a statement indicating that some property owners were forced to sell due to difficult financial situations, as their properties could not find buyers on the free market.
