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Berlin Expert

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    Berlin, Germany
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    I am a property adict!
  1. The German property market is a regionalised maket like any other. There are regions where the demand and price increases are high which is the south (Bavaria) and south west (Baden-Württemberg) to name two whereas some of the ex-east German regions look very dire due to the exodus of the work force. There has been a lack of new building activities due to financing problems since the sub-prime debacle, this has produced some shortage of acceptable housing. To name just these few aspects there are a lot of contributors to price increases in certain regions. Berlin is experiencing another run of international investors from Greece, ex Soviet Union states. If you want some detailed information there is a very detailed report to download from a blog called Property Investment in Germany: Berlin Housing Market Report 2012.
  2. Hello Investors, Please don't view this as a business offer as I am not a lawyer. I have seen these rental guarantee business models in the 80's when rent restriction were lifted in Berlin and a big sales hype started. It did not work then and it does not work now as it is a snowball system based on the assumption of ever growing sales. The only objective is to fake higher rents and thus push the price with in many cases a planned insolvency by the guarantee giver. Let me guess - there are no bank bonds in place to back up the guarantees? Fast action excluding a n y one involved in the buying process is highly recommended. Get someone local with good English to bundle the information (not at a lawyer's hourly rate,, otherwise your heamorrhage cash before you even see results) from the contracts and most important what your financial obligations are and what it is you are entitled to from the contract as these quite often vary from what you were told. Also this local contact can focus the communication and bundle the interest of various investors to create buying power for the lawyer to be employed and the new management for your apartments.
  3. The areas you have chosen in Berlin a central and popular and I think that is the best bet long term (location, location, location...). The current price level should give you a positive return. Even if you are not speculating on appreciation it will always be easier to sell in a popular area should you want or need to do so. Staying away from the crowd usually makes it harder to exit. You might also want to look at certain areas of Charlottenburg and Wilmersdorf as there are reasonable offers on the market and they are popolar areas for tenants and investors.
  4. I am referring specifically to the Berlin office market and there are various sources like AtisReal, HypoVereinsbank to name a few that have reported a big uptake of office space on the renting side and increase in rent in the first half of 2008. So if those properties can be had even cheaper than at the beginning of the year as you said (which I don't believe applies to Berlin)... I rest my case. It was always smart to buy anti cyclical which is shown by the kind of investors reappearing on the market right now. And by the way I don't have any office space for sale, just pointing out an interesting development that might be worth looking into.
  5. Invista said the changes to the rankings reflect higher economic and capital markets related risk created by the global credit crunch. It said investors are re-assessing their attitudes towards property pricing and risk but should look beyond volatile short term data and take a medium term view of market performance. Detailed article: http://www.propertywire.com/news/europe/ge...0809041580.html
  6. Berlin Office Market shows strong resilience in current European slow down. It seems that finally Berlin has assumed its special situation as the capital of Europe's biggest economy. According to Aengevelt (Commercial Property Agent) in contrast to other regions in Berlin demand for office space has grown. The German Property Market has established and reinforced its position as a secure investment destination with Berlin at the top of the list for future value in commercial properties as well as residential properties. In the wake of the increased demand rent has gone up in the top segment by 5% from 21 €/sqm/month to 22 €. In the middle segment increases were ca. 6.5% from 15.50 to 16.50.
  7. Another catch is the cost side. I see it again and again that investors calculate their yields based on promised rent. There will be a minimum of 14 € per apartment per month for the property management, say 800 € per year for the tax consultant. In the region you are talking about probably a vacancy rate of average 15 % for which you have to cover the ancillary cost at 1 - 2 € per sqm per month. Repairs? The impact of the first factors on the yield is bigger with smaller apartments and low end rents. I would definitely recommend areas with growing economy and population which applies to Dresden and Leipzig in ex East Germany and probaly Halle. For a real long term growth one definitely has to look at Berlin where you can still achieve yields around 7 - 8% for apartment blocks and somewhere between 5 - 6.5% for single apartments melting down by about 1% after costs.
  8. Back to today's reality from "Today's Zaman": Property prices fall with cancellation of law on property sales to foreigners A recent Constitutional Court decision to cancel a law governing the sale of property to foreigners has forced real estate agents to significantly drop prices and to shift their target market to Turkish customers. Fethiye Realtors Association President Nevzat Tilkici stated the residences they can no longer sell to foreigners can be sold to local Turkish people, noting that a house with a price range of 100,000 to 150,000 pounds in a foreign sale could be sold to a Turkish citizen for between YTL 80,000 and 120,000. "The Constitutional Court's decision has sharply brought down sales, which had already plummeted by 30 percent. There are many houses constructed particularly for sale to foreigners. Now the real property sector is discussing potential ways to unload these houses. The leaders of the sector want to make the newly constructed homes available for purchase by Turkish citizens in an effort to combat the slowdown in the sector. The legal decision will facilitate local people's efforts to buy their own property," he said. Tilkici added that the court's decision also played into the hands of their rival countries in the real estate sector. "The foreigners in our country had already started gravitating toward Cyprus, Greece, Bulgaria, Romania and Croatia owing to the uncertainty in the political arena. Now it will be really difficult to convince them to believe that a new law will be passed or a new regulation will be made [regarding property sales to foreigners]," said Tilkici. Ziya Ercan, the deputy president of the Federation of All Real Property Consultants and the president of the Muğla Real Property Consultants Association, stressed that the cancellation of the government regulation by the Constitutional Court caused property prices to drop by about 15 percent. Villa prices in the center of Fethiye and the Çalış, Üzümlü and Hisarönü districts range between 40,000 and 120,000 pounds. In an example of the decline in prices, a villa up for sale in Çalış at 50,000 pounds is now being sold at 40,000 pounds, which amounts to a 20 percent drop in price. Commentary: If it is not a so called life style investment I would highly recommend dafe investment environment with stable legal system being between 6 and 9 o'clock on the price cycle. I am sorry, but I have to say it: Germany is one of the best places to invest in property right now. Believe me I would not have said that 5 years ago even though living and working there. You should have a look www.properties-in-germany.de
  9. Sorry I have missed your reply for so long. You can download the report on www.berlin-portfolio.com. The link is on the left hand side, all the way at the bottom.
  10. As indicated this is a clip from a Turkish newspaper calling the measure temporary at the beginning. I am sorry - but I do find it quite alarming, especially when it has happened before as you indicated. What if you want of need to sell your property and are in one of those temporary uncertainties of undefined length where you can only sell to Turkish citizens who will definitely know about your situation? Declaring it as a measure of land development policy is a bit lopsided, why should it only apply to foreigners - good luck for EU membership. Of course I could have have said buy in Spain instead of Germany but we all know that this is currently a tricky market as well, so I recommended the market I know best and know is one of the best bets for property investment at the moment with a stable legal situation - Germany. I am not alone with this opinion: According to the report, from the Urban Land Institute (ULI) and PricewaterhouseCoopers four German cities - Hamburg, Munich, Berlin and Frankfurt - are amongst the top 10 in Europe with Istanbul ranking at No.2. The latter might change now. More details at Property Investment in Germany.
  11. Turkish property sales to foreigners temporarily halted Hurriyet English with wires, Wednesday, April 16, 2008 21:54 Turkish property sales to foreigners is to be temporarily halted from Wednesday, declared a Ministry of Public Works and Settlement inline with a Constitutional Court ruling three months ago. A new regulation was delivered to the Board of Ministers for approval. (UPDATED) A new regulation regarding the sale of Turkish property to foreigners was delivered to the Board of Ministers for approval on Wednesday. According to information obtained from ministry's officials, a circular letter on Tuesday was sent to all land registry offices indicating the end of the sale of real estate to foreigners. The related verdict of the Constitutional Court will come into effect from Wednesday. The law does not restrict foreigners who already own property in Turkey from selling it to Turkish Citizens. A total of 63,085 properties have so far been sold to 73,103 foreigners, with German, British, and Greek citizens being the leading purchasers of Turkish property. Foreign investors' annual real estate purchases amounted to $3 billion for the past three years, accounting for about 8.5% of the current account deficit. "We believe that the government will take this issue seriously and is likely to pass the necesssary legislation through the parliament. However, the timing remains uncertain and the impact on the financing of the current account deficit should be negative in the near term," Raymond James Financial said in a research report on Wednesday. Commentary: There is plenty of good investment property in Germany with a predictable legal framework! Add to del.icio.us • Digg This! • Stumble It! • Subscribe to this feed • Email this
  12. Outlook 2008 for Berlin Property Investment In 2008 we will see an increase of so called "privatisations" where international investors who have bought big residential portfolios are selling off individual apartments either as vacant condos for own use or as buy to let investment apartments. Especially the investment apartments were modernised throughout recent years and provide a dependable income source. In combination with the rental development this will open excellent investment opportunities for private investors in a robust and steadily developing market. The new rent table 2007 ("Mietspiegel 2007") has already shown increases in residential rents. Property Financing The financial sector has finally recognised this development and provides financial products to enable international private investors to have their investment apartments in Berlin financed at a level of 65 to 70% of the purchase price. Support for the financing of investment in buy to lease flats is provided by capable agents and vendors. Management of buy to rent flats Identified managing agents that are capable to communicate with international investors at the appropriate level of language and professionalism to ensure a smooth start-up after any purchase is a very important part of setting up a successful investment. Adequate support for the international investor is key for an investment decision. Conclusions The economic situation in Germany is positive with the prospect of a longer period of prosperity. The Berlin property market has three main value drivers: 1. Stable population development accompanied by new jobs. 2. Long term commitment to the location by the government and international business. 3. Still low prices compared to other European capitals with yields that allow a positive cash flow after financing.
  13. A vendor of investment property with a rent pool has to state all costs and risks likely to be incurred by the investor. Ruling: The vendor is in violation of providing the required information if claiming to positive expectations with regard to the return on the investment. This applies when the investor joins the rent pool at the recommendation of the vendor. The risk of repairs and vacancy in other apartments has to be quantified and shown in the calculations and not only mentioned on the side. While advising on property as an investment the expected cost is a key figure in the calculation. It has to demonstrate that the vendor not only is in the position to buy the property but also to maintain it. The investor can assume that the vendor has included all risks in the calculation. Vacancies or repairs at a normal scale should not immediately reduce the yield promised at the purchase. BGH ruling 30.11.2007, V ZR 284/06 Recommendation Do not let guarantees deflect you from inspecting all aspects of the apartment you are actually buying! Full information and comment on http://berlin-realestate.blogspot.com/
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