Real Estate That Makes It Easier to Earn Income in Germany
December 03, 2021
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You can earn money on residential real estate in many countries. But Germany comes to mind as the market is literally shaped to generate income. You can buy an apartment, or you can buy a whole house. But what will be the difference? What is right for you?
Is it more profitable to buy an apartment or a residential compound? The whole house is usually more expensive. Perhaps the choice of apartments on the market is wider although this fact is indisputable. What other differences are there? We asked the experts - Ekaterina Demidova (DEM Group) and Sergey Kumekov (Investix).
–Investors are counting on passive income and do not want to delve into the essence of processes and emerging problems. How tightly will the owner of the apartment and house have to manage?
– There is not much of a difference. Any apartment building in Germany is monitored by a management company. The apartment owner has two options: either hire an intermediary (you can use another company, or you can even be a private person, not a certified specialist) or interact with the company personally. Even in the second case, communication can be minimized. For example, do not go to residents' meetings at all and just follow the decisions of the majority.
The owner of an apartment building will have to hire a company whose activities are licensed to manage. In which case, more problems can happen later on.
Apartment management requires less effort, and it is easier to maintain a house with one owner than a house with several owners. In the latter case, the company requires the greatest competence in both financial and legal matters. But a professional management company in this example will not take up the owner's time and will provide them with truly passive income.
Ekaterina Demidova
DEM Group
Those who are afraid to invest in a whole house sometimes think that today that there is a risk of being left alone with a huge property. If the excitement is too great, it's easier to buy an apartment so that responsibility for the condition of housing is distributed among all owners. In any case, when choosing a management company for a home, be sure to find out what kind of staff it has and how many objects are under management. A normal company should have at least a housemaster and preferably a plumber on staff. Firms, where only administrators work, will hire a subcontractor for any issue, and it will cost the owner dearly.
Sergey Kumekov
Investix
Oddly enough, the organization of high-quality apartment management is usually a more difficult task. One apartment is a very small volume, and if the company does not have other facilities in management nearby, it may refuse to work, and working with a private person is likely to disappoint you.
– It turns out that it's one thing to hire a partner to manage an apartment and another thing to manage an entire house. Since the requirements for such a company in the second case are higher, will you have to pay more for the work?
– No. Quite the opposite. If you bought a profitable apartment as a private person and want someone to monitor it (a person or a criminal code), you are applying for an additional service that is not related to the work of the management company of the whole house. Some expenses cannot be shifted to the tenant.
– Sooner or later, any house will have to be repaired. It takes money. Where do they come from and in which case will you have to pay more?
– The owner of an apartment in an apartment building must contribute money to the capital repair fund every month. For example, all owners have been collecting funds for roof repairs for several years. This amount is usually up to €50 per month from the owner and depends on the area of the apartment and is not included in the utility bills. This is not rent: it is paid by the owners of the housing, not the tenants.
No one can oblige the owner of an apartment building to accumulate funds. He allocates money for work – for example, the replacement of a heating boiler - as needed, which he determines himself.
Which scheme is more profitable? The sole owner of the house can maneuver. They alone determine the cost and make financial decisions. This is the preferred scheme for a person with experience. Another thing is that as a result, the costs between tenants and landlords are divided in the same proportion and do not depend on the composition of the owners. This means that the costs per unit area in both cases are approximately the same.
Ekaterina Demidova
DEM Group
On the one hand, it is more profitable to buy your own house and decide on the need for repairs yourself. But this is an option for a knowledgeable owner, who will not bring the object to such a state when absolutely everything breaks down one day, and the guests will start complaining or moving out. Therefore, it is easier for an inexperienced buyer to buy an apartment where everything is handled by a management company, which is monitored by the most vigilant tenants.
It is important to remember that capital costs cannot be shifted to the tenant. More precisely, some can be – but they need to be stretched for a long time – up to ten years - and a competent management company will be able to do it. In any case, it is more correct to assume that in Germany the owner will not be able to "take into account" such a payment when determining the rental price: it is determined solely by the market.
Apartments for sale in Germany:
1 590 000 €
Flat in Frankfurt-am-Main, Germany
190 sq.m532
5-room apartment for sale in Frankfurt am Main. Area: 190 m2. Number of rooms: 5. Floor: 1. Year of construction: 1891. Last restoration: 2014. The apartment is located in a historic building in the center of Frankfurt. Spacious living room, kitchen, 3 bedrooms, 2 bathrooms, small garden with terrace. Equipped with high-quality materials: oak...
Estate-Service24
1 575 000 €
Flat in Berlin, Germany
137 sq.m543
Apartment in a new residential project, which is being built in the business district of Berlin, a 10-minute drive from the city center, on the border of the Mitte and Friedrichshain districts. Two towers will rise above the embankment of the Spree, providing residents with magnificent views of the river and the city. The ensemble of houses will...
NF Group
750 000 €
Apartment in Berlin, Germany
158 sq.m3
The apartment is located in a residence near the River Spree in Berlin. The residence was built in 2012.The 158 sq. m apartment includes 3 bedrooms, 2 bathrooms, a living room, a fully equipped kitchen. The ceiling height in the apartment is 2.90 m. Technical equipment includes underfloor heating and an eco-heating system powered by solar energy.
NF Group
Price on request
Apartment in Frankfurt-am-Main, Germany
47 sq.m211
CreditRental property
Student housing is in high demand in Frankfurt. Thanks to the fashionable concept and innovative technologies, the apartments are aimed specifically at a young target group of tenants.
Modern furnished single and double apartments with a living area of 30 to 69 m2 and their own underground parking are located near the trendy Sachsenhausen...
Estate-Service24
1 167 870 €
Apartment in Berlin, Germany
79 sq.m22
The new residences are located in a prestigious area of Berlin near the famous Kurfürstendamm Boulevard. The project is inspired by the urban environment of the quarter and perfectly combines with the historically established urban architecture.The entrance area already reflects the ambitious nature of the building and the high value of the new...
NF Group
354 000 €
Apartment in Berlin, Germany
41 sq.m
ID 14061
A new residential complex near the Cologne Park.
- 133 comfortable apartments
- Excellent location in the heart of the city near the Cologne Park
- Various: from 1 to 5 rooms, with an area of 33 to 160 m2, from studios to penthouses.
- Several options for the final design finish
- High quality: luxurious lobby and elevators, classic oak...
Russia Sotheby’s International Realty
265 150 €
Apartment in Berlin, Germany
36 sq.m
ID:14648
A new residential complex in the heart of Berlin, in one of the greenest areas of the city - Wilmersdorf. The Kurfürstendamm Embankment with numerous shops is less than ten minutes away. The nearest metro station is Blissestrasse (U7), Detmolderstrasse motorway is a 3-minute drive away.
The plot area is 1843 sq. m., a residential...
Russia Sotheby’s International Realty
3 000 000 €
Flat in Essen, Germany
1100 sq.m8
ID: 17566
The required investments are 250,000 Euros.
Annual yield 8-12%
Strategy:
1. Purchase of an apartment building with a current yield of about 5% per annum;
2. Increase of rental rates due to renewal of contracts with tenants within 5 years;
3. Resale of the object at a higher price.
The project is being implemented jointly with a...
Russia Sotheby’s International Realty
220 000 €
Apartment in Berlin, Germany
23 sq.m1
ID: 27446 A new residential building for 39 compact apartments will be built in the Charlottenburg area near the Technical University (TU Berlin), Kurfürstendamm shopping street and Wilmersdorferstrasse. The metro station and tram stop are within walking distance. Ideal for both their own use and for renting.
Studios and 1-room apartments...
Russia Sotheby’s International Realty
497 000 €
Flat in Berlin, Germany
47 sq.m211
Credit
Fantastic apartments in a quite Spree-side oasis between Mitte and Charlottenburg. Quiet, sharp, green and blue. N°1 Charlottenburg was completed by the prestigious developer Cannon&Cannon in 2019 in an outstanding compromise with space, brightness, tranquillity and modern commodities. A true Oasis amidst the center of the capital.
EW Real Estate
310 000 €
Flat in Berlin, Germany
30 sq.m111
Credit
We bring to your attention a new bright and comfortable one-room apartment in the center of Berlin. A good location opens up many opportunities for quality leisure and work. The house is located on the banks of the River Spree, close to one of Europe's most popular attractions: The East Side Gallery.
EW Real Estate
137 000 €
Flat in Herne, Germany
113 sq.m
Online ViewingRemote Transaction
There are 3 apartments for sale in Herne.
The apartments are located on the 4th floor.
The house was built in 1932 and is well maintained
The total area of the apartments is 113.63 m2
Hausgeld:486 Euro (per month, total for all apartments)
Nearby there are public transport stops, shops, clinics, supermarket REWE, museums, hospitals -...
DEM GROUP GmbH
78 000 €
Flat in Herne, Germany
64 sq.m42
Online ViewingRemote Transaction
Duplex apartment for sale in Herne
The apartment has two standard rooms and two small rooms above the level
Two bathrooms.
The area of the apartment is 64.2 m2
At the moment, the apartment is rented for 540 euros per month (tenants have been renting an apartment for two years)
Hausgeld: 206 euro
Actual annual income: 4008 euros
The...
DEM GROUP GmbH
222 500 €
Flat in Berlin, Germany
57 sq.m211
The apartment has just been renovated. You have the opportunity to purchase an apartment and move in as soon as possible.
— Year of construction — 1961
— Rooms — 2
— Real estate area — 57.4 sq.m.
— Laminate
— Elevator
— Balcony
— Basement
— Central heating
Cost — 222,500 euros
Commission — 3.57%
The apartment is located in...
EW Real Estate
969 000 €
Flat in Berlin, Germany
136 sq.m4
The charming old building was built around 1900, consists of 22 apartments and was completely renovated in 1985. The residential ensemble is in a very good and well-maintained condition.
Available for immediate check-in!
An exclusive dream apartment with 4 rooms, will provide a special quality of life. The very spacious apartment has an area...
EW Real Estate
60 000 €
Flat in Duisburg, Germany
58 sq.m211
Online ViewingRemote Transaction
Apartment for sale in Duisburg, with an area of 58 m2
Two rooms + a large balcony
The house was built in 1965
The apartment is located on the 3rd floor (2OG), there is an elevator.
Rented out.
Central heating.
Energieverbrauchskennwert 151,00 kWh/(m2*a).
Near Lake Toepper, Folkspark and Zoological Garden.
The commission for the...
DEM GROUP GmbH
767 118 €
Flat in Berlin, Germany
78 sq.m32
We present to your attention new 3-5-room apartments in one of the best places in the western part of Berlin, in an area known for the predominance of villas — Zehlendorf. At the moment, the construction of the house is underway, which will be completed in the 2nd quarter of 2025.
Only 9 apartments are being built here, spread over four...
EW Real Estate
426 496 €
Flat in Berlin, Germany
38 sq.m211
Welcome to an exclusive residential project consisting of two elegant buildings with 58 residential units and a total living area of 4,232 sq.m. Here you will find a diverse selection of apartments with 2-4 rooms and an area from 37 to 133 sq.m.
The apartments offer ample space for self-realization. Whether you want to set up a home office,...
EW Real Estate
398 855 €
Flat in Berlin, Germany
60 sq.m2
We present to your attention new 2-4-room apartments in Berlin, in the Kepenik district. At the moment, the construction of the house is underway, which will be completed in the 1st quarter of 2025.
The house is being built in a quiet side street, using the gap between the buildings, including the construction of two side wings, with...
EW Real Estate
849 635 €
Flat in Berlin, Germany
125 sq.m4
We present to your attention new 2-4-room apartments in Berlin, in the Kepenik district. At the moment, the construction of the house is underway, which will be completed in the 1st quarter of 2025.
The house is being built in a quiet side street, using the gap between the buildings, including the construction of two side wings, with...
– Many residential buildings have commercial premises. Is it good for an owner of the whole house or a minus for the owner of a separate apartment?
– Commercial premises, like any apartment, have an owner. There is no such thing as collective ownership when we all belong to some area at once. The main risk is that the premises will not be rented out or the tenant will delay payments. This becomes the financial problem of the owner.
When the owner of the commercial premises does not pay the hausgeld in a house with several owners, everyone starts having problems. The management company cannot fully maintain the facility in a normal state without having the means to do so. It will try to sue the defaulter, but the court may be delayed, and the costs need to be covered constantly…
Ekaterina Demidova
DEM Group
Now, during the pandemic, commercial premises in the house are more often a disadvantage for any investor. For example, banks are less willing to lend to houses with commercial space now in Germany. Many small companies that just rented them have left the market. In this case, the costs either fall on the owner of an apartment building or all apartment owners.
Sergey Kumekov
Investix
The presence of commercial premises is rather a shortcoming for the owner of both the whole house and apartment. Firstly, tenants of such premises are often a source of concern for neighbors because of noise, additional traffic, etc. Secondly, a business that rents such small premises is unstable and is not ready to enter into long contracts. Thirdly, it is always more difficult to change a commercial tenant than to find a new one. Therefore, during the pandemic, some investors transferred commercial premises to residential ones.
– Is it easier to get a loan when buying an apartment building than a separate apartment?
– A loan can be obtained (or not obtained) in both cases, the determining factor will not be the composition of the owners, but the budget. Banks will not work with cheap objects, especially if the applicant is a foreigner, they will not be able to cover even the costs of processing documents. €50,000 is the minimum amount of money that you need to apply to the bank. With this amount, you can count on buying an apartment up to €100,000.
Ekaterina Demidova
DEM Group
A foreigner will be given a loan only for an object that is rented out. And when buying, the bank will require documents that the property is for rent. If you buy an apartment for yourself, there will be problems with the loan.
– Is there a difference in the procedure and details of registration? They say it is better to register apartments for an individual, and apartment buildings for a legal entity…
– There is no such dependence. You can also buy a house for an individual. Here you need to think about the expediency of maintaining the company from the point of view of taxes. When buying up to a million euros, you should not think about opening a legal entity.
Sergey Kumekov
Investix
In the case of an apartment, structuring a transaction using a German legal entity becomes economically inefficient. After all, what does the GmbH open for? Reduce the tax burden, exclude any active participation of the owner in operational processes, and minimize the risk of personal liability. But when buying an apartment, these tasks can be solved in other ways.
Profitable houses for sale in Germany:
4 000 000 €
Commercial apartment building in Germany
2835 sq.m
Germany
Land of North Rhine-Westphalia
G.Hiddezen (Detmold)
New apartment building
Commercial 4-storey building divided into 11 units: medical offices (private medical practice), bank, pharmacy.
Year of construction of the building: 2013
Previously, part of the building was the city hall
Land area: 2938m2
Area for rent: 2835,13m2...
INDOM
700 000 €
Commercial apartment building in Germany
800 sq.m
Germany
Land of North Rhine-Westphalia
adm. Munster district, Recklinghausen
district of Dorsten
Apartment building 12 apartments
Commercial object: multi-apartment 3-storey building with 12 apartments for long-term rent.
The residential building is located in Dorsten with a population of 76,775 thousand people, a...
INDOM
3 300 000 €
Commercial apartment building in Frankfurt-am-Main, Germany
880 sq.m4% per year
Apartment building for sale in Frankfurt am Main. Rental status: the house is 100% leased. Equipment quality: normal. Heating: central. Floor covering: tile, laminate. Condition: good.
Equipment: - 25 apartments;
- a few minutes walk to Nidda Park;
- apartments with a floor space from 17 to 50 m2 (one-room and two-room);
- the house was...
Estate-Service24
Price on request
Commercial apartment building in Brandenburg an der Havel
5520 sq.m
Credit
The retirement residence "By the Cathedral" is one of our realized investment and construction projects near Berlin.
Reliable top tenant and a 25-year contract
For this facility, a long-term lease agreement for 25 years was concluded prior to the start of construction with a reliable solvent tenant - the European market leader in...
BiG Property
3 400 000 €
Commercial apartment building in Frankfurt-am-Main, Germany
380 sq.m3.8% per year
Credit
Apartments in Frankfurt am Main are a reasonable investment in liquid objects with the potential for profitability growth!
Frankfurt am Main, one of the top business centers in Germany, is undoubtedly considered one of the most promising and attractive large cities both in economic indicators and in comfortable living conditions.
A package...
Estate-Service24
7 200 000 €
Commercial apartment building in Germany
2957 sq.m
Germany
Federal State of North Rhine-Westphalia
Apartment house (4.5% per annum)
Apartment house in a city with a population of 55 thousand people, 20 km from Dusseldorf.
Excellent transport links
A great place where there are many new buildings
Land area: 4,249 m2
Total area of the building: 2957m2
Year of construction...
INDOM
8 000 000 €
Commercial apartment building in Berlin, Germany
1010 sq.m3.5% per year
Business on sale
New apartment building in Berlin
Built in 2020
Leasable area: 1,010 sq. m
Land area: 3,324 sq. m
Underground parking – 352 sq. m.
Rental income per year – 280 000 euros
3 levels, 12 apartments
Price 8,000,000 euros
Yield 3.5%
Intermark Global
20 000 000 €
Commercial apartment building in Aschaffenburg, Germany
3200 sq.m
A new apartment building (due date 2022) with high-quality finishes in the Bavarian town of Aschafenburg. Number of apartments: 30 Living area: 3200 sq.m. Plot size: 2900 sq.m. Number of parking spaces: 42 Aschaffenburg is a university town of regional significance in Germany in the state of Bavaria. Aschaffenburg is famous for numerous fairs...
Estate-Service24
6 000 000 €
Commercial apartment building in Darmstadt, Germany
1300 sq.m
Apartment house in a prestigious area in Darmstadt.
Number of apartments: 21
Living area: 1300 sq.m.
Plot size: 500 sq.m.
The condition of the object: well-maintained, repair work was carried out in a timely manner.
Some of the apartments in the house have been renovated to high standards - modern flooring, bathrooms, kitchens, etc....
Estate-Service24
11 500 000 €
Commercial apartment building in Germany
4750 sq.m
Germany
North Rhine-Westphalia
Boarding house for the elderly
A boarding house with medical care for the elderly
in the suburbs of Cologne.
Land area: 14000m2 (1.4 ha)
Living area of the building: 4750m2
Year of construction: 1900
Reconstruction and renovation: 1974, 2010.
The building is leased for a long time to a...
INDOM
495 000 €
Commercial apartment building in Duisburg, Germany
480 sq.m8.14% per year
Online ViewingRemote Transaction
For sale a well-maintained apartment house in Duisburg
There are 8 apartments in the house.
Now only 1 apartment is not rented.
It is in good condition and does not require repair.
It can be passed quickly.
The house area is 480 m2
Annual income 44760 euros (9.04%)
The commission for the buyer is +7.14% to the cost of the object....
DEM GROUP GmbH
580 000 €
Commercial apartment building in Gelsenkirchen, Germany
391 sq.m5.45% per year
Online ViewingRemote Transaction
The house is very well located in a sought-after area of modern development.
Good location in the area.
there are 7 apartments in the house
6 garages
The house is fully commissioned!!!Soll Jahresmiete:
32.460,00 €Ist Jahresmiete: 32.460,00 €
Commission for the Buyer + 4.76% of the cost of the object.
Details on request.
DEM GROUP GmbH
410 000 €
Commercial apartment building in Emmerich am Rhein, Germany
475 sq.m8.09% per year
Online ViewingRemote Transaction
An apartment house for sale on the border with Holland.
The city of Emmerich on the Rhine.
The total area of the house is 475 m2
The plot has an area of 469 m2
The house has seven apartments and 1 garage
Year of construction 1953, renovated in 2012 /2017
The house is rented out.
Actual annual income: 34,308 euros per year (8.36%...
DEM GROUP GmbH
615 000 €
Commercial apartment building in Muelheim an der Ruhr
690 sq.m8.24% per year
Online ViewingRemote Transaction
The house consists of 2 entrances.
1 entrance:
1 room room 130m2
3 apartments (98 m2 + 105 m2 + 45 m2)
Total area: 378 m2
Entrance 2:
9 apartments
1 garage
2 parking spaces near the house
Total area: 312 m2
Total area of the house: 690 m2.
The house generates income per year: 54,444 (~8.85%)
Details on request.
DEM GROUP GmbH
12 500 000 €
Commercial apartment building in Baden Baden, Germany
2280 sq.m
We present to your attention a new apartment building in the suburb of Baden-Baden, in the center of Gaggenau (Baden-Württemberg). Residential building with a total area of 2,280 sq.m., consists of 20 apartments and commercial premises on the ground floor. The house is currently being completely renovated and rebuilt. The store with a large...
EW Real Estate
650 000 €
Commercial apartment building in Kassel, Germany
365 sq.m8.8% per year
Online ViewingRemote Transaction
Apartment house for sale in 34314 Espenau (15 minutes from the University of Kassel).
Land area - 311 m2,
The living area of the house is about 365 m2.
There is a courtyard.
The building consists of 3 floors:
- on the 1st floor (EG) there is a one-bedroom apartment of about 59 m2, a studio apartment of about 37 m2 and a studio of about...
DEM GROUP GmbH
890 000 €
Commercial apartment building in Wuppertal, Germany
450 sq.m6.47% per year
Online ViewingRemote Transaction
For sale a solid apartment house with reinforced concrete floors, in the city of WuppertalThe house has 8 apartments and 8 garages, as well as one commercial spaceThe object is fully leased!Annual income: 57.600 euros (6.47%)Commission for the buyer +4.76% of the cost of the object.Details on request.
DEM GROUP GmbH
640 000 €
Commercial apartment building in Duisburg, Germany
507 sq.m5.62% per year
Online ViewingRemote Transaction
Selling an apartment house in Duisburg. It was built in 1959 and completely renovated in 2019. It will not need any repairs in the coming years. There are 8 apartments in the house. Updated:- facades- new windows- new pipes - new heatingA good prospect of raising the rent when the owner changes!Condition: very well maintained.Plot size: 333 sq....
DEM GROUP GmbH
1 685 000 €
Commercial apartment building in Wittenberg, Germany
1904 sq.m6.43% per year
This building, built in 1994, is conveniently located right in the center of Wittenberg (Brandenburg land).
A 3-storey residential building made of clinker, with a full basement and 2 stairs, each of which is equipped with an elevator that allows you to go down to the basement.
There are a total of 10 tenants in the house, 6 of which are...
EW Real Estate
690 000 €
Commercial apartment building in Hagen, Germany
690 sq.m6.56% per year
Online ViewingRemote Transaction
Apartment house for sale in the city of Hagen. The house is well maintained and located in the very center of the city. The house has 10 apartments + 1 apartment in an annex, as well as 10 garages. Everything is rented out profitably. Annual income: 45,288 euros (6.56%)The house was built in 1953, renovated in 1985 and in 2014The city railway...
– And yet: which investor is closer to buying an apartment, and which one is closer to buying a whole house?
Sergey Kumekov
Investix
What arguments should be taken into account? Of course, an apartment is a simpler and more affordable object for investment. At the same time, the proportion of low-quality offers is higher, which is routine to filter out. Moreover, many apartments are sold by private individuals, and it is not always easy for a foreign investor to establish normal contact with them.
Remember that in the case of buying an apartment, you have little influence on the decision-making process for the maintenance of the common property and will not be able to optimize part of the costs associated with the engineering systems of the house. The owner of the house makes decisions on repairs and modernization of the common property, based on economic feasibility.
Ekaterina Demidova
DEM Group
It is worth starting first of all from the budget. It is clear that apartments are generally cheaper than houses. Although there are possible options here. Conditionally, an apartment in Dusseldorf can cost as much as a house in Essen, but the latter will bring more, and the apartment will become more expensive faster. Is this a universal recipe and can we say that it is more profitable to buy apartments in some regions, and houses in others? No, it is impossible to say unequivocally. We need to calculate and compare everything. The main difference is the ability to make decisions on object management. Although if we are talking specifically about passive income, this opportunity is not desirable for many. I repeat: buyers who come to the German market for the first time may be afraid of possible troubles. If the fears are great it is easier to buy an apartment. But by purchasing several apartments, you can take a closer look at the whole house and get benefit from the formation of expenses.
Author: Philipp Berezin
Photo: pexels.com (Irina Iriser)
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