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Old 19.02.2019, 14:07
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Investing in German Property

I am curious to know what people think of investing in German buy to let rental property. Prices have risen a lot in recent years but still seem comparativley low (to me at least) when looking at UK or France. Eastern Germany in particular looks attractive with still low prices, a recovering economy and renovated city centres. Any opinions?
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Old 19.02.2019, 14:22
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Re: Investing in German Property

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I am curious to know what people think of investing in German buy to let rental property. Prices have risen a lot in recent years but still seem comparativley low (to me at least) when looking at UK or France. Eastern Germany in particular looks attractive with still low prices, a recovering economy and renovated city centres. Any opinions?

Germany has traditionally, for a variety of reasons, had relatively low real estate prices (big cities excepted). This is not just in the east. Even in the west and richer areas you can still find comparatively cheap houses.


There are definitely locations that are growing in desirability and if you get in early, I'm sure you can do very well out of them. It's all a question of location and recognizing potential.


When it comes to buying for rent, Germany has laws that skew the market in favour of the tenant. Tenants can hold you responsible for lots of things and evictions are difficult to push through. So make sure you get good legal advice and also pick your tenants wisely.
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Old 19.02.2019, 14:25
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Re: Investing in German Property

Buy to let is a bad idea if you don't live in the same country.

Tom
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Old 19.02.2019, 14:26
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Re: Investing in German Property

i looked at this a few years ago but was put off by:

- low rental yields
- high transaction costs
- legal system favouring tenants
- not wanting the hassle of managing property

i decided against it. now it looks even less appealing (although it does mean i missed out on capital gains).
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Old 19.02.2019, 14:46
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Re: Investing in German Property

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i decided against it. now it looks even less appealing (although it does mean i missed out on capital gains).

Potential capital gains is the biggest attraction of this market for me.
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Old 19.02.2019, 15:11
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Re: Investing in German Property

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Potential capital gains is the biggest attraction of this market for me.
then you should have bought 10 years ago
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Old 19.02.2019, 16:53
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Re: Investing in German Property

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then you should have bought 10 years ago

but will you be saying that 10 years from now?
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Old 19.02.2019, 17:03
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Re: Investing in German Property

We often hear success stories in property but not the other stories.
We hear of that person that bought in the Marais in Paris 20 years ago or in Hackney 10y ago.

Fine, but we rarely hear the average Joe and the actual return generated taken into account:
- capital gain
- taxation (heavy in most countries)
- repairs
- missed payments
- all the fees to banks, estate agents, etc.
- the time spent managing the property.
- the stress generated by all this.
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Old 19.02.2019, 17:04
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Re: Investing in German Property

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but will you be saying that 10 years from now?
no.
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Old 19.02.2019, 17:10
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Re: Investing in German Property

For example in Berlin prices are expected to go up and up (that city is still comparatively cheap).


From a tax perspective there is a Grundsteuer, please note that the government is looking to change that and for sure it will not be cheaper...... it is an excellent way for cities to make easy money on something you already paid for when you bought the house......


Having said that, I have bought a house in Germany but then I do have relatives there and most likely will move there when I retire.
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Old 19.02.2019, 19:43
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Re: Investing in German Property

Not in Germany, but I invested in real estate in the Netherlands - it is providing me with passive income (and at this rate, I'll have the mortgage paid off in about 5 years). I am actually looking to buy the second apartment, and potentially a third
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