1. Frequently Asked Questions FAQ 1. How to reserve a property?
2. Can I buy without seeing the property? 3. I cannot be in Germany
while purchasing,can I still buy? 4. Can a property, which is
rented out be sold? 5. Are there any tax advantages? 6. How to
increase rent? 7. How to get a mortgage in Germany? 8. What are
property management costs? 9. Do I have to pay tax, if I am selling
my property? 10. What is the buying process?
2. 1. How to reserve a property? A deposit of 3,000 is required
A copy of your passport is required
3. 2. Can I buy without seeing the property? Yes, we do have
properties with a steady income, so it is enough to see the
property online and evaluate the financial information. However, we
recommend to make a viewing, if possible.
4. 2. Can I buy without seeing the property? Yes, we do have
properties with a steady income, so it is enough to see the
property online and evaluate the financial information. However, we
recommend to make a viewing, if possible.
5. 3. I cannot be in Germany for the period of the purchasing
process, can I still buy? Yes. A certified Power of Attorney (POA)
needs to be signed by you. This certifies your legal representative
to act in your name and on your behalf. The POA needs to be
recognized at the German Embassy or at your chosen Notary Public.
By using the services of a Notary Public the POA needs to be on to
the Foreign Office of your country in order to receive an
Apostil.
6. 4. Can a property, which is rented out be sold? Yes. All the
costs related to the property management company (running costs)
are paid through renters. This consists of electricity, water,
maintenance, minor repairs and rental management etc. The monthly
rental covers these expenses and also provides additional return
for the investor. The return lies between 4% - 10%, providing a
consequently self-financing investment. The highest return on the
investment is the capital appreciation. Experts forecast that the
real estate prices in Berlin will appreciate.
7. 5. Are there any tax advantages? Once selling the property,
the return can be re-invested in a further property, which
mitigates any tax liability. If selling the property after ten
years there is no capital gains tax liability.
8. 6. How to increase rent? Rents can be raised once a private
renovation has been done. Property management firms can use their
market knowledge and can recommend the appropriate rent level.
However, there are limitations on the maximum amount of rent, which
can be increased. Generally, rents cannot rise above 20% within
three years. Additionally, there are properties, where rents are
being controlled and cannot be amended for a certain period
(depending on the terms and conditions).
9. 7. How to get a mortgage in Germany? Everyone with proof of
existing finance can purchase a property in Germany. In case of
buying real estate with a mortgage provided by a German bank a
binding confirmation of loan financing from that bank is needed. We
can introduce you to banks and financial institutions, which can
provide you the most suitable mortgage and financial products. We
can take over the entire financing process, while working with the
Deutsche Bank or Creditweb. In this case the financing will lie
between 80% - 85%. What are the service charges and fees? Property
agent service charge (7,14%) Property Acquisition Tax (6%) A notary
service charge of (1-1,5%) A land registry fee (ca. 1%) Mortgage
arrangement fee (ca. 1%)
10. 8. What are property management costs? Our properties
offered have a property management firm in place, taking care of
all property administration and maintenance services. This consists
of electricity, water, maintenance, minor repairs and rental
management etc. The monthly rental covers these expenses and also
provides additional return for the investor.
11. 9. Do I have to pay tax, if I am selling my property? By
reselling the property within ten years of the purchase, the
investor normally needs to pay Capital gains tax at the income. The
income tax rate provides the level of the capital gains tax.
12. 10. What is the buying process? 1. Find the right property.
2. Make a reservation. 3. Retain the services of an international
solicitor with property acquisition specialization based in Berlin.
4. The law firm will offer you with all necessary Legal Review
Reports and contracts regarding the property. 5. Pay a service
charges and fees. 6. Sign the binding Agreement. 7. Pay for the
property.