This is how the assets of the Germans develop

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Protest poster in Berlin 2017

Assets are distributed very unevenly in Germany.


(Photo: AP)

FrankfurtEvery three years, the Bundesbank asks around 5,000 German households how rich they are. The result of the report published on Monday: The assets are increasing. The unequal distribution changes but little.

Among richer households, rising real estate prices play a role in the increase. But the poorer ones have become a bit richer. The Bundesbank attributes this above all to better incomes. In addition, according to their analysis, a role is played by the lower interest rates, which has reduced the cost of borrowing and thus leaves more room for maneuver.

The results for 2017, which have only been published in the monthly report, show a clear upward trend. The net asset value after deduction of debt reached 233,000 euros, which is 8.5 percent more than three years earlier. The mean value or median reached 70,800 euros, which is even 17 percent more than three years earlier.

The deviation of the two ratios already indicates that the assets are distributed very unevenly. The mean, or average, is heavily influenced by large fortunes. The median, on the other hand, says that half of households have less than 70,800 euros, so even at best only just under a third of the average of 233,000 euros.

Interesting is the comparison with other countries. In Italy, for example, the average for 2016 was 206,000 euros, but the median was much higher at 126,000 euros. Here the distribution is more balanced. In the US, by contrast, households had an average of about 625,000 euros in 2016, but the median was relatively low at 88,000 euros.

The differences between the three countries are also shown by the Gini coefficient, a statistical measure of inequality. In Germany, it has been around 75 per cent of assets in Germany for years, and it fluctuates around 63 in Italy and has risen to 86 in the US in recent years.

For Germany, the Bundesbank gives yet another revealing breakdown. After that, the poorer half of the population has owned about three percent of the assets for years. The richest ten percent came last to 55 percent, in addition to real estate and company shares play a major role.

That's a little less than 60 percent three years earlier. However, the Bundesbank itself cites as possible reasons a possibly insufficient assessment of assets at the top – it deliberately avoids realizing a true trend here.

Another important factor for understanding in Germany is that only 44 percent of households own houses or apartments, whereas in Italy and Spain, for example, the corresponding figure is well over half. In other words, the middle household in a statistical sense has no real estate ownership at all.

This is mainly due to the fact that assets in Germany are relatively unevenly distributed. One question is also how expensive the real estate in the respective countries are. In some capitals, such as Paris or Rome, apartments are very expensive, which pushes up the average of assets without necessarily being matched by adequate living comfort.

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