Fly To Buy Germany Next? No Chance

[Converted Lurker]

Over before it even started in Germany, why do so many imagine they may discover somewhere that HPI hasn`t happened and then think they`ve found a new market? HPI is over for a very long time.

http://forum.firstrung.co.uk/index.php?showtopic=59

[frugalista]

Over before it even started in Germany, why do so many imagine they may discover somewhere that HPI hasn`t happened and then think they`ve found a new market? HPI is over for a very long time.

http://forum.firstrung.co.uk/index.php?showtopic=59

I have lived in a concrete-only building: I can testify that it really is a very soundproof and insulating material!

The poster did not even mention another major thing which keeps German houses affordable -- extremely good tenant protection laws. That'll probably keep the amateur BTLs out I would think.

frugalista

[Plastic Elastic]

I have lived in a concrete-only building: I can testify that it really is a very soundproof and insulating material!

The poster did not even mention another major thing which keeps German houses affordable -- extremely good tenant protection laws. That'll probably keep the amateur BTLs out I would think.

frugalista

Spot on! The status of tenants in Germany is completely different to this country.

Read a report in my German weekly the other week. Apparently, American (and British?) REITS are pouring lots and lots of money into German housing at the moment. However, there is a big downside to it: they tend to buy social housing from local communities which are struggling (and, let's face it, there are many communities that need to get their hands on every cent they can get). This means now that these buildings will not be associated with social responsibility any longer, and the investors will look at getting a decent return on their investments.

I think this is very dangerous, and there are lots of stories already where elderly people are subjected to questionable modernisations with presumed rent hikes afterwards in order to get rid of them.

These social housing communities tend to have long-standing histories, and the impact of foreign investment on these communities will IMHO be rather devastating.

It's up to everybody's conscience whether they decide to invest their money that way but I will certainly look elsewhere.

[apom]

Spot on! The status of tenants in Germany is completely different to this country.

Read a report in my German weekly the other week. Apparently, American (and British?) REITS are pouring lots and lots of money into German housing at the moment. However, there is a big downside to it: they tend to buy social housing from local communities which are struggling (and, let's face it, there are many communities that need to get their hands on every cent they can get). This means now that these buildings will not be associated with social responsibility any longer, and the investors will look at getting a decent return on their investments.

I think this is very dangerous, and there are lots of stories already where elderly people are subjected to questionable modernisations with presumed rent hikes afterwards in order to get rid of them.

These social housing communities tend to have long-standing histories, and the impact of foreign investment on these communities will IMHO be rather devastating.

It's up to everybody's conscience whether they decide to invest their money that way but I will certainly look elsewhere.

I had a friend who was contracting in germany.. one of the larger cities.. his agent asked him how much rent he wanted to pay.. my mate said about what he was paying in England..

He lived like a king.. it was something from a magazine

[dogbox]

another major thing which keeps German houses affordable -- extremely good tenant protection laws. That'll probably keep the amateur BTLs out I would think.

frugalista

I asked the Berlin Notary yesterday "am I the first Brittisher he has dealt with", to which he surpirsingly replied "you are the 10th this year, and I am especially dealing viz za Irish ya".

It's up to everybody's conscience whether they decide to invest their money that way but I will certainly look elsewhere.

You make a fair point, but I can't help thinking that many Berlin property owners will welcome this sudden life - line after years of recession. Not only that, but the general knock - on effect will be very positive for the Berlin economy, which = jobs and prosperity and HIGHER TAX REVENUES TO BE SPENT ON THE POOR.

[Converted Lurker]

I had a friend who was contracting in germany.. one of the larger cities.. his agent asked him how much rent he wanted to pay.. my mate said about what he was paying in England..

He lived like a king.. it was something from a magazine

Don`t know about you guys, but I`ve just about had my fill of all this fly to buy/let nonsense. I`ve nothing against retirees selling up, buying a villa abroad and enjoying the warmth on their aching joints, but I`ll lose the will to live if I read another half baked plan to make money for nothing from getting a cheap flight to Dresden.

I had a conversation with a friend of mine who said that her Son felt left out at the moment `cos all his friends at his private school had second homes abroad.."So they`ve got two mortgages on depreciating assets, and probably borrowed against their first home to put down a deposit on the second home abroad, jeez that takes some stupidity" Ship of fools, not going sailing with them. BTW, Bubb`s signs of credit contraction, first time ever this private school has not held an entrance exam for the senior school, just relieved to make up the numbers this year apparently

Edited January 19, 2006 by Converted Lurker

[backtoparents]

I asked the Berlin Notary yesterday "am I the first Brittisher he has dealt with", to which he surpirsingly replied "you are the 10th this year, and I am especially dealing viz za Irish ya".

You make a fair point, but I can't help thinking that many Berlin property owners will welcome this sudden life - line after years of recession. Not only that, but the general knock - on effect will be very positive for the Berlin economy, which = jobs and prosperity and HIGHER TAX REVENUES TO BE SPENT ON THE POOR.

Or more ammunition (sp?) for the far right?

btp

[dogbox]

Don`t know about you guys, but I`ve just about had my fill of all this fly to buy/let nonsense. I

A small minority of people got into UK B2L in the early ninties, while the rest of the population sat back and watched.

A small minority is now leading the charge into new European markets, whilst the rest sit and wait. That small minority will soon become a stampede as money flows into vastly undervalued assets. You know Germany is closer that some parts of the UK are to London.

[Converted Lurker]

I asked the Berlin Notary yesterday "am I the first Brittisher he has dealt with", to which he surpirsingly replied "you are the 10th this year, and I am especially dealing viz za Irish ya".

You make a fair point, but I can't help thinking that many Berlin property owners will welcome this sudden life - line after years of recession. Not only that, but the general knock - on effect will be very positive for the Berlin economy, which = jobs and prosperity and HIGHER TAX REVENUES TO BE SPENT ON THE POOR.

Who provided your recent mortgage in Germany and where did you finally buy?

[dogbox]

Who provided your recent mortgage in Germany and where did you finally buy?

No mortgage, might try and raise one if I buy another there.

East Berlin - Kaulsdorf via www.karras-immobilien.de

Ive seen appartments for 30000 euros. Where in our capital can you buy an appartment for £20000?

Its 1991 all over again.

[BuyingBear]

No mortgage, might try and raise one if I buy another there.

East Berlin - Kaulsdorf via www.karras-immobilien.de

Ive seen appartments for 30000 euros. Where in our capital can you buy an appartment for £20000?

Its 1991 all over again.

Or '89.

[Plastic Elastic]

You make a fair point, but I can't help thinking that many Berlin property owners will welcome this sudden life - line after years of recession. Not only that, but the general knock - on effect will be very positive for the Berlin economy, which = jobs and prosperity and HIGHER TAX REVENUES TO BE SPENT ON THE POOR.

Dogbox, from your previous posts I realise you're either close to investing in Germany or have already. If/when you buy from a private seller, the story might be totally different.

The report I was referring to, however, related to the flogging off of social housing for the short-term benefit of the ransacked coffers of some local councils.

The potentially positive effect you are describing might be there in some cases but there is a significant risk that long-standing communities will be destroyed or altered beyond recognition first (which is likely to go with a lot of hardship for individuals - we're seeing this already), and then maybe some previous social housing tenants might be better off.

I'm a bit of a leftie so this kind of logic I always fail to understand: on one hand one cannot be quick enough to flog off the valuable assets held by the public into private hands (i.e. reduce what the state/government holds in terms of genuine assets), and on the other the state is being held responsible for taking care of the fallout (i.e. those that end up in hardship as a consequence of privatisation). I fail to see the logic that holding private property should relieve you from your duty of social responsibility but, unfortunately, that seems to be a wide-spread perception at least in this country. I also think it's a tad irresponsible from the local councils in question to raise money short-term in this way.

How and in what kind of property are you investing / going to invest? I'm genuinely interested because I'm also (loosely) thinking of buying something. It would be for myself to live in, though (in case I ever return to Germany).

EDIT: just spotted your above post re Karras Immobilien - I think you are buying from private sellers so my comments re REITS / social housing above do not really apply to you. Strictly speaking, I'm probably off-topic here, actually

Edited January 19, 2006 by Plastic Elastic

[dogbox]

Dogbox, from your previous posts I realise you're either close to investing in Germany or have already. If/when you buy from a private seller, the story might be totally different.

The report I was referring to, however, related to the flogging off of social housing for the short-term benefit of the ransacked coffers of some local councils.

The potentially positive effect you are describing might be there in some cases but there is a significant risk that long-standing communities will be destroyed or altered beyond recognition first (which is likely to go with a lot of hardship for individuals - we're seeing this already), and then maybe some previous social housing tenants might be better off.

I'm a bit of a leftie so this kind of logic I always fail to understand: on one hand one cannot be quick enough to flog off the valuable assets held by the public into private hands (i.e. reduce what the state/government holds in terms of genuine assets), and on the other the state is being held responsible for taking care of the fallout (i.e. those that end up in hardship as a consequence of privatisation). I fail to see the logic that holding private property should relieve you from your duty of social responsibility but, unfortunately, that seems to be a wide-spread perception at least in this country. I also think it's a tad irresponsible from the local councils in question to raise money short-term in this way.

How and in what kind of property are you investing / going to invest? I'm genuinely interested because I'm also (loosely) thinking of buying something. It would be for myself to live in, though (in case I ever return to Germany).

Your logic seems pretty ok to me. I guess the Berlin authorities have thier reason for selling off old stock.

I saw huge amounts of development going on. What shocked me was the terrible state of existing social housing - think the film 'Seven' and some!

Replacing this are new and refurbished blocks a millions times better, and I think many of these are privately owned.

I have bought land that can be developed residentially and or commercially, which IMO gives me exposure to 2 distinct markets. I wont have the money or expertise to develop but I hope in 5 or so years a developer, or business will want the land.

When I went last year there were a lot of plots for sale. I bought mine from the Berlin authorities as it all seemed belt 'n' braces.

There are lots of new appartments (many in old communist council property) going up. Some I saw in Freideriskshane (a young cafe / bar type area) were asking c80000 euros and I was told let for 500e per month.

Beleive me when I say Berlin needs the boost that HPI will bring and will help transform it to the great city it was pre - communism.

If anyone knows who will do a German mortgage I'd be interested (but not yet, Im skint).

[frugalista]

I asked the Berlin Notary yesterday "am I the first Brittisher he has dealt with", to which he surpirsingly replied "you are the 10th this year, and I am especially dealing viz za Irish ya".

An anecdote to give you the flavour of renting in Berlin.

My sister lived there for a few years. Her boyfriend at the time rented a nice flat in the centre, he had moved there quite recently from elsewhere in Germany. One day he got chatting to a friend and learned that the friend payed less rent for a similar flat. So, he told his landlord to reduce the rent. The landlord refused. The boyfriend applied to the Berlin local council to get his rent reduced. The Berlin local council found that the rent was above market levels and forced the landlord to reduce the rent.

Bit different to the UK, isn't it?

frugalista

[Plastic Elastic]

Your logic seems pretty ok to me. I guess the Berlin authorities have thier reason for selling off old stock.

I saw huge amounts of development going on. What shocked me was the terrible state of existing social housing - think the film 'Seven' and some!

Replacing this are new and refurbished blocks a millions times better, and I think many of these are privately owned.

I have bought land that can be developed residentially and or commercially, which IMO gives me exposure to 2 distinct markets. I wont have the money or expertise to develop but I hope in 5 or so years a developer, or business will want the land.

(...)

Beleive me when I say Berlin needs the boost that HPI will bring and will help transform it to the great city it was pre - communism.

If anyone knows who will do a German mortgage I'd be interested (but not yet, Im skint).

I haven't been to Berlin since 93 but I'm sure that in particular in the Eastern parts the housing must be in a terrible condition. In that sense, I agree with your logic that foreign capital pouring into the city will bring a lot of benefits.

I think Berlin is skint, and has been for years.

My sister lived there for a few years. Her boyfriend at the time rented a nice flat in the centre, he had moved there quite recently from elsewhere in Germany. One day he got chatting to a friend and learned that the friend payed less rent for a similar flat. So, he told his landlord to reduce the rent. The landlord refused. The boyfriend applied to the Berlin local council to get his rent reduced. The Berlin local council found that the rent was above market levels and forced the landlord to reduce the rent.

Bit different to the UK, isn't it?

There is indeed a 'Mietspiegel' in Germany which outlines in detail the rent range of properties, depending on location, size etc. If the landlord charges outside the range it is within your means to complain to the authorities, and something can be done.

[newbie]

I've heard that when tenants move into a place in Germany they sometimes bring their own kitchen fitout. Is this the case?

[Plastic Elastic]

I've heard that when tenants move into a place in Germany they sometimes bring their own kitchen fitout. Is this the case?

Sometimes, yes. This depends pretty much on the condition of the place, or whether a fixed kitchen is already installed. Two friends of mine moved into another place recently. The kitchen was empty so they moved in their oven and fridge from the previous place and fitted new cupboards/surfaces around it.

[newbie]

Sometimes, yes. This depends pretty much on the condition of the place, or whether a fixed kitchen is already installed. Two friends of mine moved into another place recently. The kitchen was empty so they moved in their oven and fridge from the previous place and fitted new cupboards/surfaces around it.

How long is their lease & how fixed is the rent?

[Plastic Elastic]

How long is their lease & how fixed is the rent?

Their tenure is pretty much unlimited I guess. Well, until somebody cancels the contract. The notice period depends on what is in their contract but the landlord would need a very good reason to cancel the tenancy agreement. Notice would be rather months than weeks (three maybe) and might extend if they stay longer.

Now they're in, it'll be very difficult for the landlord to get them out. They're likely to stay there for a few years at least I suppose.

I don't know how fixed their rent is but (depending on the overall housing situation) I would assume the landlord raises the rent once a year.

Having said all that, I don't know their precise contractual agreements. It could also be a fixed lease. I think the property they last lived in was a five year lease - I don't remember it precisely but I remember that on one occassion they couldn't move because the landlord insisted on the fixed contract.

[newbie]

Thanks.

I'd want a pretty long lease and a pretty fixed rent before I put in a kitchen.

[rockdoctor]

A kitchen in Germany costs a fraction of what it costs in the UK.

My (German) wife was horrified when she saw what Brits pay.

The units are only made of chipboard after all - and few have doors made of solid wood.

Most German properties are let unfurnished, so you install your own kicthen, and take it with you when you go.

We recently converted a house (my wife inherited her mother's) back into two flats and let the upstairs one. The new tenants were delighted that we had put in a new kitchen (for 2000 Euros), but we did it to persuade them not to require the bathroom to be upgraded (much more expensive!).

Whole house worth around 100K euros, we let the top half for 375 euros/month (going rate). Better return than much of the UK at present, but it ain't going to make us rich - just about covers insurances, maintenance and other costs for the house.

This is rural area in Rhineland-Pfalz (near border with Luxemburg - 4 hours drive from Calais).

[Plastic Elastic]

Thanks.

I'd want a pretty long lease and a pretty fixed rent before I put in a kitchen.

Oh yeah, absolutely!

Actually, fixed kitchens often cause a lot of grief for both tenants, landlords and follup-up tenants. Often, it's not worth to rip out a fixed kitchen after a few years, so tenants try to get some money either out of the landlord or the follow-up tenants. In the former case, the landlord will also try to pass on the costs. I'm not exactly sure what's legal here, and what isn't but I know another couple in Cologne who (I think) had to pay some additional money for the fixed kitchen that was already in the property they were about to move into. I think this is illegal, but I was told that the housing situation in Cologne is quite tight, so landlords get away with it.

[Karen]

I've herd that you can get a house in what used to be East Germany for 35K (this was a few years ago) Along with that I heard "you get what you pay for"

[Smell the Fear]

I've herd that you can get a house in what used to be East Germany for 35K (this was a few years ago) Along with that I heard "you get what you pay for"

I did a search on property in Munich. Seems to be as expensive as London.

The other regions prices reflect their desirability by comparison with this.

How can there be any mileage in this?

[dogbox]

I did a search on property in Munich. Seems to be as expensive as London.

The other regions prices reflect their desirability by comparison with this.

How can there be any mileage in this?

Berlin lost its desirability thanks to years of communist mismanagement and degradation. I saw many unbelivably disgusting appartment blocks, the sort of thing seen in the film Seven or Fight Club.

In my opinion Berlin will regain the poise other western capitals enjoy, but it takes time. Theyve been regenerating for over 10 years ago, but there is still a lot to do. However, I felt the fabric of the place was changing. Not only lots of new development but a sense of optimism. BMW just opened largest showroom there, new mega nightclubs opening etc.

I could be wrong, but as far as Im concerned the capital of the worlds number one exporter, Europes largest economy, emmerging from years of gloom has to be just as good a bet as say Manchester in 1996 or Dublin 1997 or Cardiff 1999 and so on. Even Glasgow has had a boom - so I say give the German capital a stab.