Document Actions

Accounting

Who has really paid for the Reconstruction of East Germany? Expected and Realized Returns on Real Estate Investments in East and West Germany in the 1990s

Abstract

We evaluate the profitability of investments in residential property in Germany after unification with a focus on the comparison of East and West Germany. Calculations are carried out for (1) the after-tax return an investor might have expected at the beginning of the 1990s, and (2) the after-tax return that has been realized ten years after. We compare a set of statistical data for investments in fifty major cities by using complete financial budgeting. The results show that tax subsidies could not always protect investors from losing money, but they have boosted realized returns after tax considerably. Therefore, it was indeed the taxpayers, not the investors, who have borne the cost of reconstructing East Germany.

Keywords

URN: urn:nbn:de:0009-20-19396

Fulltext

Get the fulltext as pdf.

Supplementary material

Data from 1990 to 2003 (Excel-File) [ view | download ]
Magdeburg expected (Excel-file) [ view | download ]
Magdeburg realized (Excel-File) [ view | download ]

License

Any party may pass on this Work by electronic means and make it available for download under the terms and conditions of the authorcontract. The text of the license may be accessed and retrieved via Internet at no url given

Recommended citation

Kiesewetter D, Bensemann T, Schönemann K (2009). Who has really paid for the Reconstruction of East Germany? Expected and Realized Returns on Real Estate Investments in East and West Germany in the 1990s. BuR - Business Research, Vol. 2, Iss. 1, pp. 11-37, URN: urn:nbn:de:0009-20-19396

Please provide the exact URL and date of your last visit when citing this article.