Pitfalls to Avoid When Buying an Apartment

You are planning to buy an apartment and you're satisfied with your calculations. A few months after the purchase you receive a letter from the property manager asking you to transfer 2,400 Euros because of a decision made by the owners association months before your purchase.

This has happened to a buyer and he thought he was not liable for decisions made by the owners association before he became the owner of his apartment. He took it to court but the court denied his objection. So did the next to levels of courts of appeal. The payment of any extraordinary payment agreed in the owners meeting are not due right away but when the property manager calls in the payments. Whoever is the owner entered in the land register at that point in time is liable for the payment.

Photo by Joel & Jasmin Førestbird on Unsplash

This is proof that the investment into a due diligence is not a luxury but a necessity. When performed thoroughly it would have detected and highlighted the looming payment and would have enabled the buyer to make a provision in the purchase contract, support price negotiations or at a minimum would have avoided a nasty surprise.

In the example given, the surprise payment exceeded the cost of a due diligence for one apartment sixfold.

For more information on due diligence services see also http://www.berlin-portfolio.com/Purchase.html

Pitfalls to Avoid When Buying an Apartment

Sharp price rises continue for condominium apartments in #Berlin - JLL Report First Half 2017

The sharp rise in purchase prices for condominium apartments continued in the first six months of 2017. Compared to the same period last year, asking prices for condominium
apartments rose by around 12.5% to €3,730 per sqm.

Source: JLL Residential City Profile Berlin 1st Half 2017

The trend of higher price rises observed over the past six months is therefore ongoing, and prices are continuing to grow at a similar rate as in the period between 2011 and 2014. The average growth rate since the onset of the current upswing which started in 2009, is 10.9% per annum. Purchase prices have risen by an average of 6.5% per annum, or by a total of around €2,130 per sqm since records began in 2004. If prices continue to rise, which appears likely at present, it is possible that the average purchase price will break through the €4,000 per sqm barrier, bringing Berlin up to the price level of Stuttgart.

Download the full report with details on all Berlin districts:

Residential City Profile Berlin - 1st half-year 2017

We provide support for finding the right property investment in Berlin - but we are not agents, or only in very few cases. Investors can rely on our impartial professionality. We don't only know about the sales process but also a lot about running a property to make it perform at its best potential.

Contact: http://www.berlin-portfolio.com/feedback.html

Sharp price rises continue for condominium apartments in #Berlin - JLL Report First Half 2017

City of Berlin has extended protection of condo tenants to 10 years.

The Berlin City Government has signed off a new regulation today starting 1. October 2013 protecting current tenants of a property newly divided into condos from being given notice for the purpose of own use for a period of 10 years after the division. This new act replaces the last 2011 regulation which only covered 6 districts and 7 years whereas the new one applies throughout the city.

This protection is for the residents at the precise moment of the division only. In case of new rentals the new tenants should be made aware of the fact that their new home is actually a rented condo, buy-to-let apartment or investment apartment as they are called as well. There is no influence on rent levels, contract durations or any other contract matter through this regulation.

The purpose of this act is said to address issues of so called "gentrification" in popular central locations and the impact of current short supply of affordable (low rent) apartments on the rent level inthe city.

For support in the identification of the right investment targets please visit our website at www.berlin-portfolio.com. Especially for international Private Investors and Property Funds we provide a task force service for quick reaction to interesting opportunities. We provide independent support for the property search including foreclosure or auction properties and their valuation or appraisal. (Also see our free property market Research Service) Please use this link to the contact facilities provided there to place any requests .
Uwe Falkenberg 

City of Berlin has extended protection of condo tenants to 10 years.

Rise in Porperty Prices and Rents Flattens Out in Q2 / 2013

The much scrutinised rise in property prices and rents over the last months is taking a breath in the second quarter of 2013. This is the result of a regular study performed by Empirica  (click for full report in German) looking at advertised offers.

Investment Apartments

For condominiums, prices went up by 0.1% compared to the previous quarter 2013 but up by 5.1% for the German average compared to the second quarter 2012 (YTD). For the big cities this YTD figure is even 6.7%.

click to enlarge
 

Interestingly the Berlin market for condos does not appear in the top 10, yet neighbouring Potsdam made it. Common view is that Berlin will catch up soon and at high speed. Berlin being traditionally a city of renters (more than 80% are renting) there is a high influx of international money looking for investment after the stock markets are getting more and more volatile due to uncertainty about the duration of cheap money from the Federal Reserve in the US.

The demand of international investors is mainly targeted at buy to let apartments in preferred locations in Berlin.

Rents

There was virtually no change in rents compared to the previous quarter detected by Empirica. Compared to last year the average rise in Germany was  3.3%.

click to enlarge

The graph shows Munich ranking in No.1 as has been for years now. The Berlin Rental Market is still behind but the catch-up over the last years has been enormous.

For support in the identification of the right investment targets please visit our website at www.berlin-portfolio.com. Especially for international Private Investors and Property Funds we provide a task force service for quick reaction to interesting opportunities. We provide independent support for the property search including foreclosure or auction properties and their valuation or appraisal. (Also see our free property market Research Service) Please use this link to the contact facilities provided there to place any requests .
Uwe Falkenberg

Rise in Porperty Prices and Rents Flattens Out in Q2 / 2013

German Residential Properties on the Upturn - Demand for Condos Rising

The BBSR (Bundesinstitut für Bau-, Stadt- und Raumforschung) an institute operated by the German federal government have published their annual research results on the German residential market. The focus was on owned single apartments (condos or condominiums). For more information in German click here.

After a longer period of price stability prices for residential property especially for condos in big cities have risen. There is no indication for a price bubble though.

The average price for used/existing condos in 2010 was at 1,160 €/m² whereas in the same period it was at 2,400 €/m² for newly built apartments (condos), more than double. For big cites the data for 2011 are available and show an increase of 3.5% for used and up to 14% for new condos (which includes newly built or newly divided existing buildings). Especially private investors view this investment type as a safe haven in view of the Euro crisis. The development is also supported by currently exceptionally good financing conditions.

Purchase Prices per square meter in 2010

© Copyright by BBR. Alle Rechte vorbehalten.

Click here or the picture for a bigger version.

From a marco-economic viewpoint the development of the prices for condos is congruent with the development of rents. Especially in economic centers with strong growth demand for housing is high with a price driving effect on both rents and condo prices which also radiates into the nearby areas.

Condo Prices compared to rents in Germany 2010

© Copyright by BBR. Alle Rechte vorbehalten.

 Click here or the picture for a bigger version.

German Residential Properties on the Upturn - Demand for Condos Rising

German Property Market: Prices for Condos up by 3.9% and rents more than 5%

Every quarter empirica publish their research results for the German Property Market. The empirica-Index for the first quarter 2012 indicates rising prices for Condos and rents and a further shift in the ranking of the big cities in the German Property Market. Especially the rise of the ranking for Berlin Properties shows an interesting development.

	Purchase Prices (Condos from 2000 onwards, 60-80 sqm, high standard)
	Euro per sqm			Ranking
City	Q1/07	Q1/11	Q1/12	Q1/07	Q1/11	Q1/12
München	3.238	3.903	4.351	1	1	1
Freiburg	2.630	2.867	3.595	7	4	2
Hamburg	2.699	3.062	3.396	5	2	3
Regensburg	2.812	2.836	3.044	2	5	4
Erlangen	2.287	2.567	3.032	18	13	5
Bamberg	2.209	2.642	3.012	26	10	6
Ingolstadt	2.489	2.687	2.940	9	9	7
Stuttgart	2.637	2.800	2.908	6	6	8
Frankfurt a.M.	2.468	3.002	2.898	10	3	9
Ulm	2.229	2.460	2.836	24	18	10
Baden-Baden	2.720	2.737	2.816	3	7	11
Flensburg	2.323	2.477	2.790	14	17	12
Düsseldorf	2.384	2.640	2.723	12	11	13
Heidelberg	2.699	2.695	2.704	4	8	14
Lübeck	2.283	2.304	2.675	20	27	15
Landshut	2.322	2.564	2.673	15	14	16
Potsdam	2.223	2.547	2.662	25	15	17
Bonn	2.241	2.446	2.644	22	20	18
Berlin	2.058	2.444	2.634	37	21	19

	Residential Rent (from 2000 onward, 60-80 sqm, high quality standard)
	Euro per sqm			Ranking
City	Q1/07	Q1/11	Q1/12	Q1/07	Q1/11	Q1/12
München	11,27	12,45	13,28	1	1	1
Frankfurt a.M.	10,26	11,50	11,94	2	2	2
Hamburg	9,08	11,09	11,35	8	3	3
Heidelberg	10,22	11,02	10,93	3	4	4
Stuttgart	9,42	10,33	10,61	4	5	5
Düsseldorf	8,98	10,12	10,44	9	7	6
Freiburg	9,31	9,90	10,32	5	8	7
Wiesbaden	9,29	10,14	10,15	6	6	8
Darmstadt	8,75	9,88	9,97	11	9	9
Mainz	8,94	9,74	9,85	10	10	10
Köln	9,12	9,50	9,71	7	11	11
Ingolstadt	7,77	9,30	9,65	26	12	12
Karlsruhe	8,40	9,09	9,60	14	14	13
Baden-Baden	8,52	9,03	9,58	12	15	14
Ulm	8,01	8,95	9,52	22	16	15
Bonn	8,07	8,73	9,33	19	20	16
Münster	8,37	9,24	9,30	15	13	17
Nürnberg	8,09	8,85	9,21	18	18	18
Regensburg	8,41	8,91	9,13	13	17	19
Erlangen	7,67	8,79	9,12	28	19	20
Berlin	6,69	8,52	9,11	61	24	21

Source: IDN-Immodaten GmbH

Brief company profile of empirica

empirica is an independent economic and social science consultancy. The business was founded in 1990. Today it consists of three closely co-operating offices based in Berlin, Bonn and Leipzig. empirica provides services to public and private clients in various different sectors. Their clients include banks, building societies, insurance companies, building contractors, property investors, local authorities, local government associations, regional and federal ministries and foundations.

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For support in the identification of the right real estate investment targets in the German Property Market please visit our website at www.berlin-portfolio.com. Especially for international Private Investors and Property Funds we provide a task force service for quick reaction to interesting opportunities.

We provide independent support for the property search including foreclosure or auction properties and their valuation or appraisal. (Also see our free property market Research Service)

Please use this link to the contact facilities provided there to place any requests .

Uwe Falkenberg

German Property Market: Prices for Condos up by 3.9% and rents more than 5%

Berlin Area Residential Market Turnover Shrunk by 36%

The apartment market turnover in the Berlin region shrunk massively in 2008 compared to the previous year. The total number of purchases fell to 21,600 that is a slump of 11%. In financial figures the turnover shrunk by 36% to €5.2bn. The figure for the turnover built property in Berlin was reduced by 48% and almost halved.

BBU, an association of Berlin-Brandenburg apartment firms operates a regular market monitor which showed these results. In some of the boroughs (Bezirk) in the western part of the city, the price level for old buildings with comfort features dropped from 14 to 13 times the annual rent—in some boroughs in the east, from 17 to 15 times.

At the same time, price increases were observed for condominiums in Berlin. During the coming five years, BBU is expecting an increase in demand primarily for housing in single and semidetached houses in Berlin.
Berlin will remain a predominantly rented and not owned residential market. In the market for rental apartments primarily small and large apartments will be in demand, while there will be an excess of 30,000 medium-sized apartments the report states in its outlook up to 2014.

For support in the identification of the right investment targets please visit our website at www.berlin-portfolio.com. Especially for international Private Investors and Property Funds we provide a task force service for quick reaction to interesting opportunities.

We provide independent support for the property search including foreclosure or auction properties and their valuation or appraisal. (Also see our free property market Research Service)

Please use this link to the contact facilities provided there to place any requests .

Uwe Falkenberg

Berlin Area Residential Market Turnover Shrunk by 36%

Price Development for Properties in Berlin 2009

The German broker's association IVD came to interesting results in their latest market report for the Berlin-Brandenburg metropolitan region.

The price development for apartments in Berlin recently is spreading according to location. This spread applies both to purchase prices as well as rent.

Purchase prices and rents at the low end of the market and in medium locations fell slightly, they remained bullish in good and very good residential and commercial locations. Purchase prices for apartments in standard residential locations stabilised at €1,200/sqm, while sellers in choice locations were able to demand €1,600/sqm on average – some 3.5% more than during the same period last year.

Similar developments can also be observed in retail and office rents. While top locations in city centers were able to raise rents, facilities at the outskirts are still under pressure. Tauentzienstrasse, at €230.00/sqm, has the highest rent for retail. For office and doctors’ office space, current peak rent is €21.00/sqm.

For support in the identification of the right investment targets please visit our website at www.berlin-portfolio.com. Especially for international Private Investors and Property Funds we provide a task force service for quick reaction to interesting opportunities.

We provide independent support for the property search including foreclosure or auction properties and their valuation or appraisal. (Also see our free property market Research Service)

Please use this link to the contact facilities provided there to place any requests .

Uwe Falkenberg

Price Development for Properties in Berlin 2009

Abu Dhabi investors buy into Berlin City West

( dpa )- First it was Potsdamer Platz which was redeveloped, after the communist Berlin Wall was cleared off it.

Now, it is the turn of the heart of former West Berlin, near the war-ruined Memorial Church and Zoo Railway Station, to attract international investors.

Abu Dhabi and other emirates investors plan to plough millions of euros into a major revamp of what used to be the central business district of West Berlin in the bad old days of division.

Architects are planning a spate of new buildings around the Zoo Station and the high-rise Europa Centre shop and office complex nearby, and along a shopping stretch near the modern, blue-glazed Memorial Church.

As it is, Berlin's skyline is already set to change dramatically with construction later this year of a spectacular 120-million-euro (175-million-dollar) Giant Wheel, Europe's biggest Ferris wheel.

Although long-distance trains no longer halt at the Zoo station - they stop instead at the capital's new Hauptbahnhof station - a scheme to modernize the run-down station complex and other buildings in the vicinity is now programmed.

The Harvest investment group from the United Arab Emirates will be spending up to 200 million euros on a development, the Zoo Fenster , across the way from the Memorial Church.

The church, a popular stop with tourists, is a Lutheran church shattered during the Second World War onslaught on Berlin and rebuilt incorporating some of the ruins as a dark reminder of the evils of war.

The church is in the headlines, with campaigners seeking to raise 3.5 million euros for urgent repairs to its crumbling tower. Berlin's city government has promised 1.5 million euros towards the bill.

The high point of the Zoo Fenster project will be a 120-meter-high skyscraper. A premium hotel is also planned by 2010.

Important Abu Dhabi investors involved in the project predict a dramatic increase in commercial property values in the western downtown districts of Charlottenburg and Wilmersdorf in the coming years.

In a separate development, there are plans for the city's Schimmelpfeng Haus , a building built over the Kantstrasse , to be replaced by a 120-metre-high hotel, office and business complex, a brainchild of Casia Property Management

All told, an estimated 1 billion euros is being spent on the "City West" renewal project, including 300 million euros devoted to projects around the Zoo Bogen building estate.

As part of the revamp operations, the Budapester Strasse traffic tunnel near the city's Breitscheid Platz has been filled in, repaved and plastered, giving visitors easier access to the city's familiar high-rise Europa Centre shopping-residential complex.

It is here that Europa Centre operator Christian Pepper has spent 60 million euros modernizing the popular shopping haunt.

Investor interest close to the Kurfuerstendamm , Berlin's most prestigious shopping strip, is helping boost business confidence throughout the city's central Charlottenburg and Wilmersdorf districts.

For a period after the city's 1989 reunification, the Kurfuerstendamm appeared set to lose out, as a host of cinemas, theatres and restaurants went out of business.

The Kurfuerstendamm - Kudamm for short - still glittered at night but much of its old flavour and tang had dimmed in the 1990s, as talk focussed on the east with the reinvented Potsdamer Platz , the new Friedrichstrasse shopping malls, and the revival of the communist-era hub, Alexander Platz .

Now, that is less the case. The Kudamm has recovered much of its old glamour and assertiveness in the past three years, as new high-end shops open and its pavement cafes, restaurants and pubs win renewed popularity.

"The Kudamm is very much back in the frame, popular with Berliners and foreigners alike," say Berlin's mayor Klaus Wowereit , who now lives in an apartment overlooking the boulevard.

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One way to participate in this development is through Investment Apartments in the districts of Charlottenburg and Wilmerdorf. Currently there are offers in these areas available at:
www.city-of-berlin.info/InvestmentApartments

Abu Dhabi investors buy into Berlin City West