Buying rented apartment and paying tenants to move out

11 posts in this topic

Hi,

 

I'm looking to buy an apartment to live in myself in Berlin. Since there are very few objects within my range that are sold without tenants in them I'm exploring the possibilities of buying a rented one, and pay the tenants to move out. Of course I would have a contract signed with the tenant before I sign the actual apartment deal. So I wonder if this is a foolproof way to assure that they move out? And what kind of amounts are reasonable/common in such situations?

 

Any other tips on the subject are most welcome!

 

Thanks in advance/Dagur

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2 hours ago, Dagur said:

So I wonder if this is a foolproof way to assure that they move out?

 

Almost certainly not!

Seriously, if there was any realistic chance that you could have a contract signed with the tenant before you signed the actual apartment deal then the current owner of the property would have done that themselves already.

 

Quote

And what kind of amounts are reasonable/common in such situations?

 

What kind of amount is reasonable depends on whose point of view you consider it from.

 

If you were a tenant who may be looking at having to pay 50 - 150% more rent every month than you are paying now to be able to stay for the rest of your days in the Bezirk you grew up in then a few thousand Euros to cover removal costs would be no incentive at all. Maybe adding that to an amount equal to the estimated difference in rent for about 3 - 5 years might swing it though.

 

I doubt anyone could tell you what kind of amounts are common since such negotiated payment amounts are most probably conditional and subject to non-disclosure clauses in the relevant contracts.

 

I'm not just trying to be negative about your strategy here but, if you have been studying the Berlin market, you surely must have noticed that similar objects which were unoccupied fell outside your range by a margin of what - probably 20 - 35% or so oder?

 

If it was realistically possible to convince their sitting tenants to vacate their apartment for less than say 10 - 20% of its value why do you imagine so many landlords would be choosing to forgoe their chances of gaining an additional 10 - 15% at the time of sale?

 

Perhaps you may be able to better match your needs to your budget if you were to extend the range of areas of Berlin you are researching or to concentrate on looking for less popular apartments with north facing windows on the upper floors of those rear courtyard buildings without a lift.

 

2B

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Thanks for your input!

 

You're probably right in your assumptions, but I'm thinking it can't hurt to try. Perhaps sometimes the current owner does not have the capital to buy out the tenant or such. Even if it would end up costing as if it were untenanted it would greatly increase my options at least.

 

Does anyone have any practical experience of such dealings?

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14 hours ago, Dagur said:

 

You're probably right in your assumptions, but I'm thinking it can't hurt to try.

 

It can hurt because you'd at the very least need to hire a lawyer to write the contract and that's going to cost you. Whether you find a flat with a tenant willing to sing it it's anybody's guess.

 

14 hours ago, Dagur said:

Does anyone have any practical experience of such dealings?

 

I don't have any experience and I've never heard of anyone doing something like that. The first flat I bought had a tenant and I simply said the tenant had to be out before I signed anything. I also insisted that it be written on the contract that no one was living in the flat. The owner and the tenant agreed (against no consideration on my part).

 

There's such thing as "Eigenbedarf", which allows you to claim a flat you own for your own use after giving proper notice to the tenants. It's not fool proof and it can bring some hassle even if it works. If I ever decided to go down that route, I'd make sure the tenants are young, reasonably healthy and have good incomes (to minimize the chances that if they claim some kind of hardship when you terminate their lease), then buy the flat, and then give them notice based on "Eigenbedarf". As this is not a 100% foolproof method (caveat emptor: estate agents will tell you it is, but that's a lie) you need a plan B in case they take you to court over it and win (unlikely, but possible).

 

Also, have you considered buying a flat that's been repossed in auction? If you do it right, you have a "special right" (according to S. 57a ZVG) to give the tenant (if any) notice to vacate the premises, but it needs to be exercised immediately: if you miss the first available date to give notice you miss this chance! You've got to get this right so lawyer up if you go down that route.

 

My advise is that you buy a flat that's empty.

 

Disclaimer: This is not legal advice. I am not a lawyer; just an internet-addicted idiot, and so on and so forth.

 

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I remember reading (but of course I don't know where) that another requirement for claiming eigenbedarf can include showing that YOU need the apartment.  Not just want it, but actually need it for yourself as your current place is somehow not sufficient.  I think you can consider apartment size (that can bite you in the ass though, as eg. no single person needs 80 qm for themselves alone, especially if you're kicking out a family or couple, etc), proximity to work, costs, and that kind of thing, but no, it's not always a slam dunk.

 

you should see a lawyer for real legal advice if you really want to pursue this.

 

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8 minutes ago, lisa13 said:

I remember reading (but of course I don't know where) that another requirement for claiming eigenbedarf can include showing that YOU need the apartment.  Not just want it, but actually need it for yourself as your current place is somehow not sufficient.

 

 

yes, absolutely. Either your place is not sufficient or you don't have a place. Just "wanting" it is not enough Also, your claim for Eigenbedarf can be shot down if the property in question is a five-bedroom house and you are single, as that would be considered "unangemessen". 

 

You can also claim "Eigenbedarf" for your child, your parents or your grandparents. It doesn't necessarily have to be yourself that needs the apt.

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1 minute ago, Smaug said:

You can also claim "Eigenbedarf" for your child, your parents or your grandparents. It doesn't necessarily have to be yourself that needs the apt.

 

sure sure - I was just responding in the context of the OP, who wants to use the apartment directly

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Thanks for valuable info!

 

I did know a little about Eigenbedarf before, but now I surely know more. I will also have a closer look at the auction possibilities.

 

My main goal is to secure as much as possible beforehand to avoid spending time in courts etc at all. So if anyone has experience of similar situations please do share!

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When looking at places look for "eigenbedarf geschossen" in the notes  this means that you can't kick the people out. There are also very strict rules on how much notice and how much you have to pay to get people out. The longer they've been there the more it will cost you. 

 

Are you looking for an investment property or for a place to live? If you're looking for an investment property than look for listings that how how much the place is being rented for and you can calculate the yield (rent x 12 divided by the purchase price). The advantage to this is you can slowly (every 15 months) raise the rent. As mortgage rates are at life time lows and most of the costs get passed on to the tenants over time it becomes quite lucrative. 

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1 hour ago, Tim Hortons Man said:

When looking at places look for "eigenbedarf geschossen" in the notes  this means that you can't kick the people out. 

 

I think you mean "Eigenbedarf Ausgeschlossen". The Bundesgerichthoff decided that such clauses are void so you can give notice even if that's included in the contract.

(http://www.t-online.de/finanzen/immobilien/id_65027240/bundesgerichtshof-bgh-hat-entschieden-eigenbedarf-ausgeschlossen-kuendigung-trotzdem-zulaessig.html

 

1 hour ago, Tim Hortons Man said:

There are also very strict rules on how much notice and how much you have to pay to get people out. The longer they've been there the more it will cost you. 

 

Notice period is three months. As you say, this can be longer if the lease has been running for a long time but it's never longer than 9 months (if the lease has run 8 years or longer).

 

The landlord doesn't have to pay the tenants anything unless there are special circumstances that give the tenant leverage over the landlord and that's something they'd negotiate. 

 

2 hours ago, Tim Hortons Man said:

Are you looking for an investment property or for a place to live?

 

The OP is looking for a place to live.

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3 hours ago, Tim Hortons Man said:

The advantage to this is you can slowly (every 15 months) raise the rent.

 

oh do be careful giving that advice.  the legal requirements for raising the rent on a sitting tenant are far more complex than that.  There are whole threads dedicated to this topic.

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