Buying property in Germany

289 posts in this topic

8 hours ago, catjones said:

 

depends on how you read it...

 

 

all predictions, by definition, are opinions.

 

True, pundint's feet are rarely held to the fire over bad predictions. Best example, the guy who predicted Donald Trump had a 1% chance of winning.

 

Two pundits I follow Garth Turner (Greater Fool) and Ben Rabidoux (twitter) and the difference is quite telling. Garth is prone to large predictions "interest rates will normalize" (hint they never did) while Ben is far more cautious and more accurate. But with any pundit you need to be careful what advice you follow.  

 

Quote

So I would expect German property prices, especially in Munich to be lower by the end of this year. It could be as little as 20% or as much as 50%

 

Houses unlike the stock market are very illiquid, in my 60 years I've sold exactly 1 house! The general advice regarding housing bubbles is that prices tend to remain sticky as it takes a long time for owners to adjust to the new reality. The other factor going in is how hot was the housing market prior to the correction. The hotter the market (sellers market) the longer it will take prices to adjust and vice versa for a buyers market. It's really hard to predict how things will play out. In the US there was a massive housing bubble which when burst left millions of owners in a negative equity status, while in Canada prices briefly paused before charging upwards

0

Share this post


Link to post
Share on other sites
On 4/3/2020, 10:15:16, BradinBayern said:

What fun.  Now we are into arguing basic math.  You truely are an exceptional troll. 

 

Now that Dark Knight is gone dark ....

0

Share this post


Link to post
Share on other sites
42 minutes ago, Rushrush said:

Houses unlike the stock market are very illiquid, in my 60 years I've sold exactly 1 house! 

 

 

How many houses have you actually Bought?

 

The one house you sold could very well be a run down crappy old one room apartment in Stoke on trent..    

 

 

I do wish Brad would see the coin from the other side, My side..   The side of a "Hand worker", a Practical hands on guy...  ..  someone who doesnt really doesnt have a full grip on reading and understanding statistics and online calculators etc... ( Not saying I am a Thickie... but I would rather knock an opening for a new entrance door that fill in a form !)

 

It wuld be nice if he was to come back and tell us if he has bought and sold property and if he did or didnt turn a reasonable proffit.. 

 

If he comes back with a fair and honest answer, he will get my full respect and will be treated with respect from now on.. :)

0

Share this post


Link to post
Share on other sites
10 hours ago, catjones said:

 

depends on how you read it...

 

 

all predictions, by definition, are opinions.

Exactly.  I specifically stated that was my opinion. Then the screechy noises screeched that it was just my opinion.  I am not sure what else would make the screechy noises happy. 

0

Share this post


Link to post
Share on other sites
1 hour ago, SpiderPig said:

 

 

How many houses have you actually Bought?

 

The one house you sold could very well be a run down crappy old one room apartment in Stoke on trent..    

 

 

I do wish Brad would see the coin from the other side, My side..   The side of a "Hand worker", a Practical hands on guy...  ..  someone who doesnt really doesnt have a full grip on reading and understanding statistics and online calculators etc... ( Not saying I am a Thickie... but I would rather knock an opening for a new entrance door that fill in a form !)

 

It wuld be nice if he was to come back and tell us if he has bought and sold property and if he did or didnt turn a reasonable proffit.. 

 

If he comes back with a fair and honest answer, he will get my full respect and will be treated with respect from now on.. :)

I do wish you would realize (and all the others commenting) that I am NOT saying that real estate is a bad investment in normal times.  Once again, for like the third time, if you bought property in 2006 in the US and sold it in 2009 than you did not make a profit.  Therefore real estate is not ALWAYS a good investment.  In my opinion (and in the opinion of many experts) we are looking at a downturn that is much worse than 2009. Therefore real estate is, in my opinion, a bad investment NOW:  Whether or not you did well with property in the past is irrelevant.  Past performance is not indicative of future returns.  

 

I can't believe that I have to state the obvious.  A ten second search on Google will suffice:  https://www.immobilien-zeitung.de/corona

 

BTW, respect is to be earned not given.

0

Share this post


Link to post
Share on other sites

Since some people seem to be curious about myself (although I don't see the relevance since my personal finances are not going to change the real estate market in the slightest), yes, I have bought and sold real estate and yes I have enough money to do so now (even in this overpriced region) but I choose not to for all of the reasons stated.  Not that you are done with the ad hominems, now you can address the arguments.

0

Share this post


Link to post
Share on other sites
1 hour ago, SpiderPig said:

see the coin from the other side, My side..   The side of a "Hand worker", a Practical hands on guy...  .. 

It's great that you are good at what you do, enjoy it, and can support yourself and more doing it.  The world needs many types.  Following nearly 30 years of continuous home ownership (4 houses in 3 different markets) we loved becoming renters again, first in the US and now in Germany.  Our money is equally well invested in a different way, many things that used to be our problem no longer keep us awake at night, and freedom and liquidity exist.  Good landlords and good tenants are win-win for each other and fullfill different financial and emotional needs.  Right now as I sit in my beautiful sunny south facing windowed living room I love my situation, but I can appreciate why you love yours too.

5

Share this post


Link to post
Share on other sites
22 hours ago, SpiderPig said:

Hows your investments doing?    Mine hasnt lost a cent since I invested in mine!...

I liquidated all of my mutual funds last summer because I saw a downturn coming and because I wanted to get as many assets as I could out of the US.  I just put all of that back into the stock market.  Of course I couldn't do that with the retirement investments and those have dropped a lot.  Since my employers matched the IRAs I haven't technically lost any of MY money. 

 

You, on the other hand do not know if you have lost money until you actually go to sell.  What the value is on paper is not necessarily what you will realize - especially in a crisis. 

0

Share this post


Link to post
Share on other sites
4 hours ago, BradinBayern said:

Since some people seem to be curious about myself (although I don't see the relevance since my personal finances are not going to change the real estate market in the slightest), yes, I have bought and sold real estate and yes I have enough money to do so now (even in this overpriced region) but I choose not to for all of the reasons stated.  Not that you are done with the ad hominems, now you can address the arguments.

So you havent actually bought property in Germany...am I correct?

0

Share this post


Link to post
Share on other sites

 

5 hours ago, BradinBayern said:

liquidated all of my mutual funds last summer because I saw a downturn coming

 

Well, that's not true.  You didn't see this downturn coming...no one did.  Likewise, had there not been the virus, nothing else in the economy has suggested a downturn.  You didn't sell at the "high".

 

5 hours ago, BradinBayern said:

 

You, on the other hand do not know if you have lost money until you actually go to sell.

 

Real estate is being bought and sold today and market prices get recalculated daily.  Do you want to know what your property is worth?  Look at today's comps.  Are they a guarantee?  No, never have been anymore than your stock price this morning is what it will sell for tonight.

1

Share this post


Link to post
Share on other sites
3 hours ago, catjones said:

 

 

Well, that's not true.  You didn't see this downturn coming...no one did.  Likewise, had there not been the virus, nothing else in the economy has suggested a downturn.  You didn't sell at the "high"

I did indeed see a downturn coming.  I did not see THIS downturn coming. I think I might have even posted about it if you really care to check the archives.  This downturn will be much worse that I had predicted.  I am not sure if I have time the bottom correctly. If I could do that with any accuracy then I wouldn't need my day job.  I might invest more if it goes down further.  Time will tell. 

 

Also, I never claimed that I sold at a "high".  You are putting words in my mouth. I did well enough.

 

There were indeed indicators beforehand if you bothered to look beyond Wall Street.  Orders for industrial machines, for example, were way down.  Some companies by 90% BEFORE corona.  My company was already talking about Kurzarbeit before anyone had heard of Wuhan.  We just came off a record high sales the year before.  Industrial machine sales are a canary in the coal mine. 

 

3 hours ago, catjones said:

Real estate is being bought and sold today and market prices get recalculated daily.  Do you want to know what your property is worth?  Look at today's comps.  Are they a guarantee?  No, never have been anymore than your stock price this morning is what it will sell for tonight.

I bet I can conduct a trade faster than you can sell a house.  Exponentially faster. 

 

 If I am selling a share, then my share is exactly like any other share so in that way it is more like cash.  It is not really an estimate, but you are right that there might be a slight delay before the trade actually takes place - but not usually the entire day.  More like a few minutes.  But when the sale is done, my share is handled the same as any other.

 

 Your comps are just an estimate. Sometimes, there aren't even any really comparable comps (or are so old as to be useless) There are a thousand variables that impact the value of real estate, (buyers, marketing, location, style, what else is on the market, local school reputation,condition, interior design, upgrades, timing, hidden damage, etc. etc. etc.) so your single family home will never be exactly like another single family home.  Therefore, yes, your comps are significantly different from the going rate for a stock.  

 

Also I am willing to bet that you have exactly zero "corona comps" so until you try to sell you will not know what impact this crisis has had on your investments whereas I can get real time feedback on the value of my investments.

0

Share this post


Link to post
Share on other sites
9 hours ago, BethAnnBitt said:

It's great that you are good at what you do, enjoy it, and can support yourself and more doing it.  The world needs many types.  Following nearly 30 years of continuous home ownership (4 houses in 3 different markets) we loved becoming renters again, first in the US and now in Germany.  Our money is equally well invested in a different way, many things that used to be our problem no longer keep us awake at night, and freedom and liquidity exist.  Good landlords and good tenants are win-win for each other and fullfill different financial and emotional needs.  Right now as I sit in my beautiful sunny south facing windowed living room I love my situation, but I can appreciate why you love yours too.

I see the Alps from my rental apartment and am 5 mins from the Chiemsee.  To buy this place (at least pre-crisis) would be about 1,300,000€ - 1,500,000€

 

I also prefer to own, but those numbers just do not add up.

0

Share this post


Link to post
Share on other sites

So, you havent bought any property here in Germany and are comparing you American experience to the German property Market.

 

Wow... A view of the mountains... and 5 minutes to a rip-off tourist trap...  ( I am not saying it isnt nice there)...

 

I aint far from the Vinyards here.. 5 minutes away is a pub that sells good beer at cheap prices...

 

Anyway... I wont bother trolling you anymore...  You must feel really good each month paying that hideous rent... 

0

Share this post


Link to post
Share on other sites

And when you sell your house at a 300% profit, where will you live? If the market is so good at the time everything else will be equally expensive, oder? :P

2

Share this post


Link to post
Share on other sites
23 minutes ago, fraufruit said:

And when you sell your house at a 300% profit, where will you live? If the market is so good at the time everything else will be equally expensive, oder? :P

 

Exactly. And you have to pay higher stamp duty (Grunderwerbsteuer) when you buy your new place to boot.

 

This can work in certain cases, as when you move from an expensive area to a cheap area. That's the reason so many British pensioners can sell their house in the UK after decades of absurd inflation and buy something in a small coastal Mediterranean town where most locals can't compete with them.

2

Share this post


Link to post
Share on other sites

When I sold my house in Canada the real estate agent remarked that I would have gotten more for it if I'd sold a year earlier but a year earlier, I was happily living in it, not thinking about selling at all.  Sometimes life gets in the way of profits.

5

Share this post


Link to post
Share on other sites

Yeah, Oberbayern is just hideous.  What a fool.  Go drink your cheap beer and stick to something you know about. 

0

Share this post


Link to post
Share on other sites
2 hours ago, BradinBayern said:

I did indeed see a downturn coming.  I did not see THIS downturn coming.

 

That's the thing about predictions: success has many parents; failures are orphans.  If you keep predicting downturns/upturns, sooner or later you'll be right. 

 

2 hours ago, BradinBayern said:

I did well enough.

 

If you sold 2-3-9-10 years ago, you'd still be ahead of today.  Try predicting the turning points, then you can brag.

 

1

Share this post


Link to post
Share on other sites
1 hour ago, catjones said:

 

That's the thing about predictions: success has many parents; failures are orphans.  If you keep predicting downturns/upturns, sooner or later you'll be right. 

 

 

If you sold 2-3-9-10 years ago, you'd still be ahead of today.  Try predicting the turning points, then you can brag.

 

If I could do that, I would be at JP Morgan (or in yacht somewhere in the Caribbean), not here. 

I wasn't bragging, just answering the troll's questions.  I know I was lucky this time. 

 

You've done better or you just like to sling shit like the pig?

0

Share this post


Link to post
Share on other sites

I’ll say something, all my wealthy friends in Munich and around own property in Munich (Kreis) with no exceptions. All except one couple are at least 50% German. A few do live in rentals but they rent in turn. This is not just anecdotal, it’s been consistently reported that the wealthiest 10% or 5% in Germany own their homes. That may sound obvious, but I think it’s still relevant.

 

About market timing: not possible. The only way to make a consistent good return in the stock market is to invest widely, reduce costs, and stay in for the very long term. Everything else is noise, like for example the 6.5% jump in the last 24 hours. Gee, if I only I had bought a couple days ago. How can I live with myself? I think I’ll just let my automated investment plan  buy again on the 15th and afterward on the 1st and go have breakfast.
 

 

2

Share this post


Link to post
Share on other sites

Create an account or sign in to comment

You need to be a member in order to leave a comment

Create an account

Sign up for a new account in our community. It's easy!


Register a new account

Sign in

Already have an account? Sign in here.


Sign In Now