All Forum Posts by: Christoph Heim

Hi Federico,

achieving financial independence from real estate is very hard in Germany. Compared to the stories you hear on bigger pockets, the cashflow you are likely to get in Germany is not enough to become financially free. If you are lucky, it will cover all your costs related to the property (bank rate etc.).

In Germany, real estate is a long term investment where usually the biggest gains (depending on region) come from appreciation.

Hi Nikhil,

BRRRR definitely works in Germany. You would have to get a relatively short term loan (5 years or variable) to buy the property and fix it up. Then you can refinance afterwards like in the US. For the first loan the bank has to take the "Niederstwertprinzip" in account, that means, even if you buy at a huge discount, the bank can not appraise the property higher than your purchase price for that loan. When you refinance after a few years this is no longer necessary and the appraisal can be much higher.

The regulations for selling before 10 years only mean that you will be taxed if its held privately but with the BRRRR strategy you don't sell, you just refinance.

Welcome to Germany!

If you have any specific questions relating the German real estate market feel free to ask.

Unfortunately most useful information will only be available in German. Which region are you moving to?

Dear Hassan,

it's pretty easy. To put a property under contract in Germany, only a notarized agreement is binding. This would automatically cause notary fees and closing costs for you. There is a possibility that is not very well known and I am also not sure on how it works exactly but it's called "Sprungauflassung". Also, it's not going to be easy to find properties in the current market that you can sell with an uplift.

If you want to do it similar to a real estate agent, you need a §34c license in Germany.

Best Regards

Christoph

I don’t know about the US, but according to German law you would not be able to purchase her share without consent of the other heirs. Secondly, Stuttgart is not allowing Airbnb. Despite there being lots of properties offered on Airbnb, it’s against the law (there are a few exemptions) and as far as I remember the fine goes up to 50k EUR.

Hi @Dana Dorsch,

yes, Ulm is a very competitive market. I don't think buying a home to use it for 2-4 years is the best option. Firstly, currently buying seems more expensive than renting in hot markets. Secondly, you will lose about 7-10% closing costs when buying. Regarding the mortgage terms, you could either get a flexible loan (not very common) or a 5 year fixed mortgage to reduce the penalty (Vorfälligkeitsentschädigung) when selling the property before the loan ends.

@André Rairan Zacchi Pereira I usually use local banks to finance my deals. Using different gives a bit more flexibility 

I don’t know where you heard that but for Germany that is 100% not true. The laws here are even more tenant-friendly than in the US in general (maybe not compared to certain states).

@Mary Louise I really hope you did not spend too much money on that coaching. Wholesaling, despite being possible, is a very delicate procedure in Germany. It is done very rarely. I would really like to know if you even know the German term for it as many real estate professionals in Germany have no idea about it. Foreclosures are no longer interesting in good markets as selling prices rise way above the appraisal in most cases. If I am wrong on any of those topics I am happy to learn from you.

@Beniamin Bruda I would say usually about 80% of the appraised value.