Buying to let
Vera Kaufholdt (Habitamus Immobilien GmbH)
 Although
Germany's capital is presently one of the most exciting hot spots for young
people from all over the world; there still is an invisible gap between the
former East and the former West and the citizens of both are melting very slowly
into one.
According to the property market the division is only actually noticed, when
renting out homes. For example: Some years ago the district Kreuzberg and
Friedrichshain (both central districts) merge into one common district. Still
people from Kreuzberg can not imagine to live in Friedrichshain and vice versa.
Along with this feeling goes a change in the social group. Some Districts in former East-Berlin changed
substantially during the past 15 years. Young, high
earning people replaced the local inhabitants, who could no longer afford the rising
prices for accommodation.
The local government did establish special laws such as the German "Milieuschutzverordnung"
(conservation area regulation) to protect the population from all walks of life.
But this did not really help.
Therefore, people with lower incomes moved to the outer districts. The
buildings there were not in the same modern and satisfactory condition as the
houses in the central most desired areas. Even when modernised, it is mainly
with less money and hardly any government spending (less depreciation). In these
areas the vacant space is higher and the vacant periods between tenants are
much longer. Nevertheless, the rent is still too high for too many people. This is
because the gap between wealthy people and lower income tenants is getting
wider. People with low income sometimes can not even afford these low-level
flats to rent.
Here begins the most important part of managing a building or complex. The
person in charge must find the balance between the rent according to the
Mietspiegel (rental table) and the profit-expectations and also the ability
of tenants to earn sufficient for their subsistence. When the balance is not
struck, the rent is not secure.
It must be possible to secure a good maintenance level within the building,
minimise vacancies and ensure that the rent is paid regularly
and fully. It is crucial to rent to people who identify with the building
and the area to make sure that they pay their rent monthly without complaining. If
the rent is too high for their income, people begin to find defects or faults in
the flat or building. According to German law it is possible to reduce the rent in
relation to the negative influence of the defect. This happens mainly when
people live in a property that is too expensive for their actual income.
In addition, the mixture of people combined within a building can help to
stabilise its structure.
To make sure the rate of return is continuous and the investment returns
improve, it is essential to find an active management so that vacancies
can be avoided and good contact to the tenants is kept. This is also the most
time-consuming part of the job. It is extremely important to look for the next
tenants upon notice of termination. Only then a continuously full
occupied house can be achieved.
The choice of a company fully active with an interest in the market, the area
of the building, jurisdiction and the skill and ability to bring the offer early
on the marketplace will help ensure that the rate of return is stable. Be
careful when this aspect is offered for a small charge.
When you buy to let, you need to find a good property manager near by.
habitamus Immobilien GmbH
10247 Berlin, Jungstraße 5
Tel: 0049-30-293 63 810
Fax: 0049-30-293 63 811
e-mail:
info@habitamus.de
Web: www.habitamus.de |
