Tenancy Law / Politics / Taxes / Condominium Law

DIW: Regulation increases ownership

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a direct connection

The German Institute for Economic Research has measured the impact of increased regulation in the housing market. You can find the summary of the results here , the entire report here , Thereafter, a regulation of rents leads to

  • Landlords offer their apartments for sale because renting is no longer worthwhile
  • Regulated apartments stay cheap, so that the tenants hold on to them and these apartments are much sought after,
  • shoot up the rents of unregulated apartments and
  • impatient apartment seekers need to resort to condominiums.

The DIW draws a clear conclusion: there is a connection between the rental regulation and the home ownership quota: the more regulation of the rental market, the more people live in their own home.

a Berlin example

I'm a real estate lawyer, the discussions with my clients prove the aforementioned conclusion. A few days ago, one of them made me aware of an advertisement on Immoscout (pdf here ). It initially looked like a rental offer: a nice 4 room apartment in Berlin-Lichterfelde for 1.400 Euro net cold. When reading the description of the object, however, the following hint was found:

Description
Here could be a very nicely cut 4-Zi-old apartment in the Beletage (1. OG) of an old building in Lichterfelde-West offered by private.

However, given the recent political developments in Berlin, I will no longer rent this apartment, but sell it. Rental inquiries therefore futile! Thank the Berlin Senate and Mrs. Lompscher. If you are interested further:

https://www.tagesspiegel.de/berlin/entwurf-des-mietervereins-so-koennte-berlins- rent cover-look / 24597522.html

If you are interested in buying the apartment, you will find the sale ad here: ...

The sale ad will then offer the apartment for purchase for 780.000 Euro, pdf here .

Anyone who issues 780.000 Euro for an 4 room apartment must expect 6% = 46.800 Euro land transfer tax and another 1,5% = 11.700 Euro notary and land register costs, which together with the purchase price are 838.500 Euro. If you finance that with 1% interest and 4% repayment, 41.925 Euro annual borrowing costs are 3.493,75 Euro per month. I think it is rather unlikely that someone does it to subsequently rent the apartment for 1.400 Euro, especially since these 1.400 Euro in view of the planned Mieteckckel anyway would not be sustainable. But this is probably someone who will buy himself here.

Rent for tax

The example also shows how taxes make rents more expensive. Just to recoup the land transfer tax, a tenant would have to pay 47 Euro every month for 1.000 months, that's 4 years. If he pays "only" 500 Euros per month for the real estate transfer tax, it's 8 years. To be honest, I think that's pretty crazy.

Invest at the apartment level

For the construction of assets and passive income from real estate, especially one or more condominiums, I have written an ebook, you can find the link to Amazon here , If you prefer to keep it printed in your hand, you will find it here .

Who under the new rules no longer rent, but wants to use itself: personal needs

If you want to read about the topic of self-employment termination, you will find related blog articles under the following links. Of course you can also just commission me, then I will do everything for you as your lawyer.