FRANKFURT (dpa-AFX) - The German and European real estate sectors showed weakness on Wednesday. Shares such as Vonovia, TAG Immobilien, LEG Immobilien and Aroundtown lost between 1.7 and 3.7 percent. The European sector index Stoxx Europe 600 Real Estate fell by 1.6 percent to its lowest level since the end of November 2023.

Investors are likely to exercise caution, particularly in view of rising capital market interest rates. The downward trend in European real estate values began at the start of the year when interest rates started to rise on the bond markets. While the yield on ten-year German government bonds has risen by a good 0.40 percentage points to 2.44 percent since the beginning of the year, the real estate sector has fallen by a good ten percent.

"There were significant price losses on the bond markets. The yield on ten-year German government bonds recently approached the 2.5 percent mark," Helaba wrote. However, in view of the positive inflation outlook, the European Central Bank is unlikely to have any interest in tighter financing conditions further dampening growth. In addition to the difficult situation in the construction industry, the real estate sector, which has come under pressure, is also moving more into the focus of the monetary authorities, according to Helaba.

The European bond market and the real estate sector could receive a boost on Thursday. Preliminary consumer prices for February will then be published from France, Spain and Germany, among others./bek/tih/jha/