Bundesbank board member says no German real estate bubble
FRANKFURT Jan 26 (Reuters) - German central bank executive board member Andreas Dombret sees no sign of a bubble forming in the broader real estate market, dismissing fears centred around a residential property price rise that continues to exceed overall inflation rates.
"A panic is not justified," the Bundesbank's Dombret said in comments published on Saturday by business weekly WirtschaftsWoche.
"Even if there are signs of an exaggeration in preferred areas of some German metropolitan areas, one should not speak of a real estate bubble," he said.
Bundesbank calculations seen by WirtschaftsWoche show property prices in 125 German cities rose 5.3 percent in 2012 compared with the previous year.
Germany's inflation rate has remained above the ECB's euro zone target of below 2 percent for much of 2012 as its economy outperformed European peers, fuelling robust wage rises.
"Excessive credit growth is typical for a bubble and you don't see that here in Germany. Real estate is solidly financed," he said, reaffirming his recent warning though that loose monetary policy and high liquidity could pose a risk. (Reporting by Christiaan Hetzner; Editing by Louise Ireland)
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