Selling an apartment or house in Germany

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Hi, I have seen too many posts in this forum regarding buying an apartment / house in Germany with a lot of apprehension whether it will be easier to sell at a later date at a reasonable price and also whether it will be better than paying off rent or paying interst on mrtgage.

Was just wondering, if any of the members in this forum has any experience in seeling any property in Germany. He can prabably through more light on such matters.

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I think neither I nor anyone else understands what kind of information you are actually seeking. pls elaborate, more clearly. tks

I am a professional independent insurance broker, financial adviser, and authorised advertiser. Contact me.
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Oh, see, now that's a first - I thought Starshollow could discern, dissect and discourse on the meaning of the most obscure descriptions. He's my substitute Santa Claus.

(Meant positively!)

- MollyB

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mayank, it all depends. If you have a specific scenario you can describe, and, better yet, some quantitative information, someone may be able to comment knowledgeably.

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MollyB: it is gray and cold outside, I am still suffering from a bad case of flu (and since I am a male that means I am really SUFFERING) and now you have made me smile for the first time today. Tks. And maybe Santa Claus is living in Starshollow after all and people where just looking for in the wrong places in the past...

Cheerio

I am a professional independent insurance broker, financial adviser, and authorised advertiser. Contact me.
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Well, Just wanted to know if any of us in the forum has really made any profits by selling his / her house / apartment in Germany. And how easy or difficult was to sell the house? How much was the agent's fee and other hidden costs?

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Mayank: since for the last 10 years real estate price for non-commerical properties has at an average across Germany been stable (i.e. no appreciation in value) there won't have been many opportunities to actually make a great cut with most properties in most German regions. However, this differs a lot from region to region. During the last two year real estate prices have started to go up steeply in Berlin, mainly due to demand from outside (foreign investors) thus creating a bit of an artifical boom there, but it is working. In some other areas like Dresden, Leipzig and smaller eastern cities like Jena and Erfurt, moderate increase both in rental yields and prices of property has been noticed lately. In the west, only very limited areas like Frankfurt, Hamburg, Suttgart and Cologne next to Munich have seen some increase in property value, the reason being that German private and institutional investors are still dis-investing in Germany and carrying their money elsewhere whilst investors from outside see German now as a splendid medium and longterm investment opportunity. FERRI rates Germany also as one of the most promissing areas for real estate investment. So while probably not many people can answer your question as to who made profits during the last years with a big "huzza, I did", such an investment could be a smart move in the eyes of many professionals around the world right now.

As long as you are not selling a place in an area where there is close to zero demand, real estate agent (rea) fees should be only collected from the buyer, not from the seller of a property. But it is know that in some areas in Germany , rea take 3% plus Vat from each side. This however should be the absolute top you can expect or should accept. Don't know what you mean with hidden costs, pls elaborate.

Cheerio

I am a professional independent insurance broker, financial adviser, and authorised advertiser. Contact me.
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Also keep abreast of any changes in tax law. Currently, a property held >10 years is free of capital gains tax in Germany when it is sold (if there is indeed a profit). That may change in the future, and your purchase may not be grandfathered.

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Are there any online resources that show the average time it is currently taking to sell an apartment/house in Germany (or regions therein)? I understand of course certain areas would see higher demand, but some general ballpark would suit me for now. It seems that in my particular case, it may make more sense to buy a property when we move to Germany than to rent, assuming I could be reasonably comfortable that reselling wouldn't take years on end.

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Also keep abreast of any changes in tax law. Currently, a property held >10 years is free of capital gains tax in Germany when it is sold (if there is indeed a profit). That may change in the future, and your purchase may not be grandfathered.

We discussed this on another thread last week. Property is exempt from CGT if you have been living in it as your residence for two years before selling (ie. even if you have not owned it for ten years). The residency bit is important because the tax is an anti-speculation measure.

 

Not that it matters usually because there is no profit.

 

I have Germany family members that have sold for a profit but *only* where (a) they live in the absolutely most sought after areas of high demand from wealthier people and - b- they have often added significant value themselves (ie. building on).

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it does really entirely depend on which area/city of Germany you will be heading to... there are places where it is no problem to sell a property at reasonable prices fast and others where you will be stuck for a long time. And also bear in mind: on top of the purchase price for the property you'll have about 10% costs (real estate agent, notary, land taxes) and it is kinda hard to get this money back on top of the property price within a couple of years...

 

Cheerio

I am a professional independent insurance broker, financial adviser, and authorised advertiser. Contact me.
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It also depends on the property itself. We searched for a house for about six months. At first I was checking online once a week or so, and several times I contacted the agent just to be told that the house was already reserved. So I started checking online listings every other day. When the property we ended up buying got listed, it couldn't have been online more than a couple of days when I got in touch with the agent. Within a few weeks, there were seven families involved in a bidding war. And this for a house in a small community in a rural area south of Schwaebisch Hall which isn't exactly a highly desirable area.

 

In our case, it was an estate sale and priced low to sell quickly. Even with the price being bid up, we still ended up getting a good deal. (and considering my husband and his family are Swabian and everyone "approved" of our buy, that's quite an accomplishment! ;) ) Meanwhile, there's another similar house nearby that has been on the market for over 1.5 years and the owner has lowered the asking price at least twice with no takers. It has a much smaller garden (500 sq. m) and needs a new heating system, while ours was fully renovated and in move-in condition with 2000 sq. meters.

 

In a rural area it is difficult to find a small, modern house with a larger property since most are big, old farmhouses with barns and other shacks. I didn't want to go through a full renovation and perhaps have to tear down an old barn. So we were searching for a very specific, hard-to-find place and it is no wonder that others were also quickly interested.

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Hello there, I am still interested in finding out how long it takes to sell a house in Germany. Pinneberg to be exact. I am trying to help a friend sell his house there and would like to know what we are up against as far as how long and how easy. I have placed the house on as many sites as I can find and even paid for a website to help in the sales of it.

 

I would really appreciate your opinions on this and look forward to hearing from you.

Take great care!

Corrie

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Pinneberg is commuter-belt for Hamburg, which gives it an advantage but given current circumstances I don't think it's going to be easy selling. A friend of mine sold an apartment a couple of months ago near Pinneberg for a loss, after 10 years of ownership. The property needs to be as clean and cared for as possible and priced right. Some decent enough properties can sit for months or years without selling around here. The market is just not as dynamic as the US, UK, etc.

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Hello there, I am still interested in finding out how long it takes to sell a house in Germany. Pinneberg to be exact. I am trying to help a friend sell his house there and would like to know what we are up against as far as how long and how easy. I have placed the house on as many sites as I can find and even paid for a website to help in the sales of it.

 

I would really appreciate your opinions on this and look forward to hearing from you.

Take great care!

Corrie

The simple answer is unfortunately the answer that you and your friend probably don't want to hear.

 

If the price is right, you'll sell the property in a couple of months even under the current, poor, market conditions. The unfortunate fact is that in Germany, as a rule, properties lose value after being built (the loss is even recognised in the fact that you can write off the loss against tax), so if you come here with a US/UK mentality that you expect to sell a property for a profit after a few years, then you are going to have problems.

 

The mentality in Germany is (still) that you buy a house when you are settled and you expect to live there till you die. This may change in the future as more flexibility and mobility is demanded from the workforce, but we haven't got there yet. The simple fact is that there is no real "market" in houses in Germany.

 

PS, notwithstanding the fact that I spend my working week in Salzgitter, we own a house about thirty km north of Pinneberg, so I do have a feel for the market there. I'm not talking pure theory (it's also the fourth house we've bought in the twenty+ years since I've been here).

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I thank you very much for your answer. I am from Canada and really have no clue what it is like to sell in Germany. I from what I have seen in searches in Germany house sales, think my friend is asking a fair price. His house is two houses attached together with multiple apartments. Also from what I understand, he is not asking a huge amount for a profit. He simply wants to pay for it and the taxes and move on. I have put the house on every site I can find but have not even had one reply and wondering if it is the market, the place or simply not wanted? I would really like to help him sell this and let him have one more less stress. I thank you again and if you have any other pointers, advice or information it would be very much appreciated.

 

Thank you and take care!

Corrie

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It very much depends on the type of property. The declining birth rate in Germany is already leading to a situation where population decline is setting in. This has a result that the bottom end of the market - unrenovated old buildings, say prewar, are effectively unsellable. The property is then worth the price of the site minus the costs of demolishing the house (including the costs of disposal of the rubble).

 

As MrNosey mentioned, Pinneberg is actually well situated near Hamburg, offering comparatively cheap accommodation for people working in Hamburg, with relatively short commuting times of around thirty minutes. A decent house (for a single family) for a reasonable price ought to sell relatively easily.

 

How old is the house, how many flats does it have (assuming they are rented). For an investor, the house is worth approximately ten times the sum of the annual cold rent (ie, not including heating, water and other consumption costs) and sinking. Ten years ago the ratio was thirteen times the annual rent.

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Get a Makler (real state agent), in most of the states the buyer pays for his services.

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Don't get a makler so that the buyer doesn't have to pay for his useless services.

 

Seriously, we found a great house with no makler and we saved over 20K € by not having a makler. It was so easy. I honestly do not know why people pay for maklers.

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Makler fees should just be considered as part of the purchase price of a house. Pretty silly to avoid buying a property you like at a price you can easily afford just because part of that price includes real estate agent fees.

 

Maklers can be very helpful in selling a place. As a buyer, I was in touch with several maklers who would regularly give me a heads up on properties which fit my specs that were coming onto the market before they were publicly listed. So consider listing with a good, experienced local makler.

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