Vonovia SE on the Capital Market

Shares in Vonovia

The capital markets are continuing to focus on the outlook for the macroeconomic environment and, as a result, on interest rates in particular. There would appear to be an emerging consensus that the interest rate hikes are over, or at least almost over, but that interest rates will presumably remain at an elevated level for longer than originally expected. The question as to which central bank interest rate policies will ultimately result in a recession or will manage to achieve a soft landing will only be answered later on down the line, and the answer could also vary regionally.

Changes in the EURO STOXX 50 were announced at the beginning of September, and Vonovia’s shares lost their index membership.

The broad-based DAX (+10.5%) and EuroStoxx 50 (+10.0%) indices reported positive performance. While the real estate sector as a whole, and German residential real estate stocks in particular, showed signs of improvement in the first nine months, the EPRA Europe Index lost 7.0%.

In this exceptionally difficult market, shares in Vonovia gained ground, trading at € 22.81 at the end of the third quarter, up by 3.6% on the closing price for 2022.

We are still observing an ever-wider gap between capital market expectations on the one hand, and what remains relatively stable development on the residential real estate market on the other. While the capital market still appears to be pricing in a marked correction, the residential property markets in which we operate remain relatively robust. The less pronounced real estate value adjustments are also countered by higher rents and much shorter supply.

As a result, we remain confident that the fundamental conditions in our markets will ensure positive development in the long run. These include, in particular, the favorable relationship, from an owner’s point of view, between supply and demand in urban regions as well as the structural momentum on the revenue side.

Vonovia’s market capitalization amounted to around € 18.6 billion as of September 30, 2023.

Share Price Development