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Old 12.08.2016, 14:16
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How much would you value this investment property

2.5 room top floor flat
located in the outskirts of kanton zurich with <50 min train to zurich
rented with 15k annual income net of running costs (on mortgage-free basis)
no voids in the last 6 years

if you were to buy this property as an investment, how much would you pay?

Last edited by Phil_MCR; 12.08.2016 at 14:47.
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Old 12.08.2016, 14:32
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Re: How much would you value this investment property

About £2.50
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Old 12.08.2016, 14:36
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Re: How much would you value this investment property

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About £2.50
Do you have properties for sale? I'm interested. Will buy in cash, if you have change for a 20 CHF note
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Old 12.08.2016, 14:42
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Re: How much would you value this investment property

15k / 4-5% = 300-375k, would buy if no issues or renovations needed
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Old 12.08.2016, 16:02
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Re: How much would you value this investment property

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2.5 room top floor flat
located in the outskirts of kanton zurich with <50 min train to zurich
rented with 15k annual income net of running costs (on mortgage-free basis)
no voids in the last 6 years

if you were to buy this property as an investment, how much would you pay?
300k, assuming it was renovated in the last 10 years.
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Old 12.08.2016, 16:44
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Re: How much would you value this investment property

When buying an Eigentumswohnung you do want to check if the money set aside for repairs on common property is high enough. Insufficient funds would of course influence flat value negatively. If it is to let I think I wouldn't buy without terrace (or balcony, Gartensitzplatz, respectively).
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Old 12.08.2016, 19:45
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Re: How much would you value this investment property

The standard is now a new kitchen every 15 years or so I've heard, so take that into account. And of course how old the building is. I would also check what will happen to the area in general or if it's possible that they build something that blocks the view and affect the value.
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Old 13.08.2016, 18:21
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Re: How much would you value this investment property

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2.5 room top floor flat
located in the outskirts of kanton zurich with <50 min train to zurich
rented with 15k annual income net of running costs (on mortgage-free basis)
no voids in the last 6 years

if you were to buy this property as an investment, how much would you pay?
The most obvious question is "How large is it?" "How many square meters floor space?"
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Old 14.08.2016, 11:45
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Re: How much would you value this investment property

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The most obvious question is "How large is it?" "How many square meters floor space?"
Not really relevant for an investment property that has been let out, as your not using the property. It's values is based on net yield, or by 'novice investors' on positive cash flow with near zero interest rates.
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Old 14.08.2016, 13:12
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Re: How much would you value this investment property

Check comparis, it has an option you can check in the map all properties sold in the area for the past 10 years, account for the price change.

depending on the size and location could be between 400 to 500k
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Old 14.08.2016, 16:28
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Re: How much would you value this investment property

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Check comparis, it has an option you can check in the map all properties sold in the area for the past 10 years, account for the price change.

depending on the size and location could be between 400 to 500k
Don't forget that interest rates have fallen, so the tenant could insist on substantial rent reduction.

400-500k is pie in the sky, at 5 % the interest cost would exceed the rent by 40% and thats before any repairs, insurance, agents costs or voids.
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Old 14.08.2016, 17:01
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Re: How much would you value this investment property

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Don't forget that interest rates have fallen, so the tenant could insist on substantial rent reduction.
Unlikely. Rents on average historically have been always only growing despite development of mortgage rates.
https://www.stadt-zuerich.ch/prd/de/...dex.html#daten

Sale of the property is also a valid reason to kick out the previous tenant and re-rent at market price. On increase the rent based the increased capital investment due to the sale (riskier - he can object and you'd carry the burden of proof to justify it)
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Old 14.08.2016, 17:04
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Re: How much would you value this investment property

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Unlikely. Rents historically have been always only growing despite development of mortgage rates.
https://www.stadt-zuerich.ch/prd/de/...dex.html#daten
That has no relevance to existing rentals, I rented in ZH for over 15 years & the rent increased less than 10% in the entire time. I never bothered to ask for a reduction. Interest rate was noted as 3.5% in my contract.
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Old 14.08.2016, 17:17
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Re: How much would you value this investment property

I would not buy to invest here, only to live in.

I`d estimate CHF450,000 and 25,000 more with an underground parking space...
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Old 14.08.2016, 17:22
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Re: How much would you value this investment property

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That has no relevance to existing rentals, I rented in ZH for over 15 years & the rent increased less than 10% in the entire time. I never bothered to ask for a reduction. Interest rate was noted as 3.5% in my contract.
It is pretty relevant, read the rest of my post. If your apartment will be sold, you can be just kicked out at earliest possible cancellation date, so that the new owner could rerent at the current market rates and avoid lowering it and arguing with you about it.

*On average* the rents have always been increasing in the past.
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Old 14.08.2016, 21:42
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How much would you value this investment property

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It is pretty relevant, read the rest of my post. If your apartment will be sold, you can be just kicked out at earliest possible cancellation date, so that the new owner could rerent at the current market rates and avoid lowering it and arguing with you about it.

*On average* the rents have always been increasing in the past.


I don't believe that's true, from personal experience I can call BS, they have to personally need live in it to be able to get the renter our. If the renter does not want to leave & goes to court they will get 3 years to move out, possibly even if they only had a 1 year fixed contract in the first place. Do not assume you can easily get vacant possession.
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Old 15.08.2016, 05:32
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Re: How much would you value this investment property

I think in practice you'd have a hard time disputing such cancellation, even if the landlord is being mishonest. And there are a few other ways to get rid of unwanted tenants. The previous landlord could also cancel in advance on account of that's easier to find a buyer for a vacant apartment, courts have allowed that in the past. Or the apartment could suddenly need renovation.

New landlord can also just plainly raise the rent, but then he would have to defend it and carry burden of proof: he could claim insufficient yields on capital investment (not profitable now due to too low mortgage interest rates on which calculation is based) or adjustment to market prices (hard to prove in courts).

Last edited by ivank; 15.08.2016 at 05:44.
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Old 15.08.2016, 09:50
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Re: How much would you value this investment property

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I think in practice you'd have a hard time disputing such cancellation, even if the landlord is being mishonest. And there are a few other ways to get rid of unwanted tenants. The previous landlord could also cancel in advance on account of that's easier to find a buyer for a vacant apartment, courts have allowed that in the past. Or the apartment could suddenly need renovation.

New landlord can also just plainly raise the rent, but then he would have to defend it and carry burden of proof: he could claim insufficient yields on capital investment (not profitable now due to too low mortgage interest rates on which calculation is based) or adjustment to market prices (hard to prove in courts).
Even if an apartment needs renovation a court could give the tenant protection for 3 years, the law very much favours the tenant in CH. Remember that a new tenant can go to court if the previous one paid significantly less rent & get his rent reduced.

It's great to hear there is still a greater fool willing to buy at any price
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Old 15.08.2016, 10:36
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Re: How much would you value this investment property

If you'd do that (fight toe and nails as a tenant), wouldn't you get (sort of) blacklisted and have trouble getting a new flat when it comes to finally moving out?
After all, you have to list a reference and my guess is if they consider you as a tenant, they do call the old landlord.
I'd certainly do that.

That doesn't help you as a landlord in that moment, but still....
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Old 15.08.2016, 11:26
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Re: How much would you value this investment property

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If you'd do that (fight toe and nails as a tenant), wouldn't you get (sort of) blacklisted and have trouble getting a new flat when it comes to finally moving out?
After all, you have to list a reference and my guess is if they consider you as a tenant, they do call the old landlord.
I'd certainly do that.

That doesn't help you as a landlord in that moment, but still....
They probably won't ever get you out if you want to be difficult, so will be most helpful if the tenant actually wants to leave. If renovation is the reason given the tenant can return with only a small increase in rent, not market value. My ex GF paid 400 in Basel, unchanged in 25 years the landlord tried to get her out, went to court every few years she ended up wilt 3 years protection each time. The landlord eventually refurbished the property halving the no of flats but double the size. Ex GF ended up paying 1100 tor the renovated apartment when market value would have been 2750. The landlord is one of the biggest private landlords in Basel with interests outside property, not a 'little amateur landlord'.
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