Location, location, location! Real estate professionals know that this is what matters. Because the location of a property is one of the most important factors that influence the value of the property. A property can be adapted by conversion, renovation, demolition and new construction – the location, on the other hand, remains the same.

Even if the location cannot be changed, this does not mean that a good location always remains good. However, it does not mean that an unfavourable location cannot be improved. The quality of the location can increase if, for example, noise pollution decreases. A bypass or motorway feeder road can relieve the traffic load of a district or a municipality in this way.

On the other hand, where larger residential buildings are being built, a new department store is being built or a company is expanding its factory, the volume of traffic usually increases. The quality of the location often drops at such locations. Here, residents often take legal action against extensive construction projects. Because they fear – often not without reason – a depreciation of their real estate.

In principle, the following characteristics ensure a good location:

• Proximity to attractive jobs also in the future
• Proximity to shopping facilities with daily necessities such as supermarkets, bakeries, drugstores, etc.
• A good medical supply by short ways to doctors and pharmacies
• Proximity to cribs, kindergartens and schools
• Proximity also to cultural and leisure facilities
• A good connection to motorway and public transport

Good transport connections are particularly important in communities located in the vicinity of conurbations. This is because the majority of jobs are located in conurbations. The example of Munich makes this clear. More than 27,000 new jobs were created here in 2017, compared with only 8,000 for apartments.

But it’s not just such features on a large scale that count. Those looking for real estate also make demands on the so-called micro-location. Is the house or apartment in a green area, for example? Is there a park or even a lake nearby? Are there parking spaces in the immediate vicinity or is there an underground car park? The environment also plays a role. What are the neighbours like? And is the burglary rate low?

Anyone whose property fulfils all or at least most of the criteria can consider himself lucky. Because this is an excellent location. This is also reflected in the value of the property.

Would you like a free valuation of your property? Contact us! We will be happy to advise you.

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The post How does the location affect the value of my property? appeared first on m2Square Berlin Real Estate.

How much is my house actually worth today? Most owners can name a number here after a moment of reflection – but it rarely corresponds to the actual value. Studies show time and again that the majority of property owners overestimate the value of their homes. What is the reason for this and what can sellers do about it?

Who lives happily in its real estate and does not intend to move out all too soon, makes itself only few thoughts around the value of the home of one’s own. But if there is a sale on the horizon at some point, too high an asking price will ensure a long sales process.

Anyone who owns a house associates many memories with it. This alone gives the property a high emotional value. But handprints of children in concrete are for potential buyers rather a lack than an additional value. The emotional connection to the home of one’s own is only one factor that leads to an overestimation of value.

Those who have lived in their own home for a long time will certainly have invested a lot of money in maintenance. A new roof, a new façade or heating: all this has its price. However, this cannot simply be added to the price originally paid. Because for prospective buyers these things are a basic requirement and not a bonus.

Besides in the media is again and again spoken of rising real estate prices. The conclusion that the own real estate must have increased in value since the purchase is therefore obvious. How high the increase in value is, however, most owners do not know. It can help to orient itself at the real estate prices in the neighbourhood. However, these do not represent an exact measure, because year of construction, equipment, location and many other factors play into the price.

As a private seller it is difficult to get an exact idea of the value of the house. It helps to think rationally and not to be influenced by emotional memories. It is also important to get to grips with the local real estate market – online evaluation tools provide a clue here. However, they do not provide accurate data. If you want an accurate assessment, you can’t avoid an evaluation by a local real estate expert.

You want to sell your property and are unsure how much it is worth? We will be happy to advise you and take over the assessment for you. Contact us now.

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Perhaps you are currently faced with the question of whether you want to move into a new, age-appropriate home or convert your beloved four walls barrier-free. But what happens if you or your partner need care? Under what conditions could technological developments support everyday life at home in a sensible and discreet way?

The number of people in need of care in Germany is increasing rapidly. Unfortunately, however, many elderly people are not lucky enough to be cared for by their own relatives. And the nursing staff is also becoming scarce. The idea of placing the welfare of the elderly and infirm in the hands of robots comes from Japan. But can we still talk about their “well-being” at all – and emotionally?

Almost 2.9 million elderly people in need of care currently live in Germany, one third of them in retirement homes. The Federal Statistical Office estimates that this figure will increase to around 4.5 million by 2050. How should this challenge of demographic change be met? In the future we will face the problem that although there are more and more people in need of care, there are fewer and fewer people who take up and pursue care professions. In addition, the health and nursing insurance companies lack money, but this becomes necessary when the number of seniors who are no longer able to cope with their daily lives themselves increases.

Are nursing staff being replaced by technology?

The Japanese are facing a similarly precarious situation, which also leads to new ideas in the field of artificial intelligence in the country of technical innovations in the field of geriatric care. Already 16 years ago, the electronics group Panasonic opened a high-tech nursing home near Osaka, where residents were supplied and controlled exclusively by technology. However, even the technology-oriented Japanese could not make friends with some products such as necklaces with motion sensors, which were intended to monitor the stay of the home residents and prevent them from running away.

Germans are much more sceptical about the idea of being washed, fed and carried by robots in their old age. For this reason alone, it cannot be assumed that artificial intelligence can replace human nursing staff in Germany in the near future. Some media often suggest that the technology will make all nursing staff obsolete in the future. “But there is a translation error here”, Christian Buhtz, founder of robotics manufacturer Boston Dynamics Marc Raibert, clarifies in an interview with heise online. “There are simply no care robots. There are only robotic systems that can support individual functions and thus relieve the workload of nursing staff”.

What counts is the interpersonal aspect

According to Buhtz, the problem is not the technical feasibility, but the complexity of interpersonal relationships between nurse and patient, which enables individual encounters. The question of whether nursing robots can really satisfy the needs of old people does not really arise from this point of view. Artificial intelligence has no feelings like love, connectedness or joy, it can only simulate such feelings corresponding behaviour. And even if the opponent may not recognize the difference, one moves here ethically seen on a narrow degree.

Christian Buhtz advocates a sober presentation of the real capabilities and possibilities of machines and prefers the terms “robotic care assistance systems” or “robots for maintaining autonomy”. In Germany, numerous companies are working to support people in need of care in their daily lives in this way. Primarily it concerns technology, which is installed into the dwelling, in order to relieve caregivers or maintaining member. Technological developments such as automatic roller shutter control, intelligent overflow systems for the bathtub, fall detectors and smoke detectors networked with emergency call centres are already available on the market, but are not yet very widespread in private homes due to the high purchase costs.

Together with the Berlin Charité, the industrial gas company LINDE is working on a project called Bea@home, which is intended to enable respiratory care for people in need of the most severe care at home. The implementation is currently being tested in practice – with great success: the project gives the caregivers greater confidence in taking action and patients can be cared for in their home environment. Instead of all-round care by a nurse, a sophisticated monitoring system is installed at the bedside of the respiratory patients and continuously transmits the medical values to a hospital. For the nursing and health insurance companies this means a considerable financial relief, and for the patients and their relatives nothing less than that they can live side by side in their own four walls.

In a discreet supporting function, Artificial Intelligence can actually help elderly people. But a warming smile and the right word at the right time can only give a being with emotional intelligence.

You want to design your home with modern care technologies to suit your age? We will be happy to check whether your property is suitable for this.

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You buy your property not to live in it yourself, but as an investment? Then don’t make yourself dependent on any place. It can be nice if your own investment is right on your neighbourhood, but you may get more return from a different location. Because how lucrative the purchase of a property is varies from region to region, city to city and sometimes even district to district.

If you live in Munich, you can charge high rents for your property there, but you also have to invest a lot. The situation is different in a rural area in the east, for example. Here it is still possible to acquire a property at a reasonable price. However, many vacancies make it difficult to find a tenant for the property. And purchase price and demand are not the only factors determining a good location for investments. The interest rate or, for example, the ratio of management costs to rent also play a role.

An experienced investor and real estate expert will find the right investment concept for every location. However, as a layperson it is advisable to weigh up risk factors and thus find the right location. In addition to the expected returns from rental income, performance can also be an interesting incentive for an investment. What are the forecasts for the next 10 years? Will the prices per square metre continue to rise in one region? Then you can also make a profit by buying a property now and reselling it in a few years.

The investment pays off in these regions

Various market research institutes provide investors with data on the current top regions. The Hamburg Institute of International Economics (HWWI), for example, has identified Heilbronn as the city that can expect the highest increase in value per square metre by 2030. Whoever bought a house with an area of 100 m² in 2017 could expect a net profit of 150,000 euros if sold in 2030. However, prices in Heilbronn and southern Germany in general are already significantly higher than in the rest of Germany.

For investors who do not want to invest much at the moment, but are nevertheless looking for a property that promises high returns in the future, the northwest of Germany is particularly interesting. The investments are particularly worthwhile on the Dutch border of Lower Saxony. The Emsland is at the forefront. Here the price per square metre is approx. 21 percent below the national average and the increase in value is 1.14 percent annually. Who buys now a 100 m ² house and sells it 2030 again, can count so on an increase of 24.000 euro.

Another study focuses less on rural regions than on suitable investment locations, but rather on so-called B cities, i.e. cities that do not rank among the major metropolises but nevertheless promise a good return on investment. This risk/return ranking was carried out by real estate service provider Dr. Lübke & Kelber. Large amounts of data on 110 German cities were compared. The focus is on the ratio of potential risks to actual expected returns.

The study made a distinction between existing properties and new buildings. The city of Wolfsburg in Lower Saxony scores particularly well in both categories. The cities of Aschaffenburg and Fürth are also interesting places to invest in new buildings. The cities of Osnabrück and Worms are also recommended for investment in existing properties.

You want to invest in real estate and need advice? Contact us now for more information

Fotos: © RossHelen

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From the veranda to the sea or from the mountain down into the valley and still feel at home? This is possible with holiday homes. They are not only worthwhile for your own relaxation. They are also an interesting investment. In preferred locations with first-class facilities, holiday properties can offer value stability and prove to be crisis-proof old-age provision. However, there are risks involved.

Germany is a popular holiday destination – and not only during the summer holiday season. Over the past eight years, overnight stays in Germany have risen continuously. This was determined by the Federal Statistical Office. Holiday homes and apartments are the second most popular type of accommodation directly after hotels. Many believe that holiday homes can only be rented 120 to 150 days a year. For example, banks often assume this when granting loans. But that’s not true. Holiday times as well as holidays and bridge days already come to 100 days. In a very good location and with good facilities, holiday properties can be rented in Germany almost all year round.

Holiday properties by the sea or in the mountains are particularly in demand, both among holidaymakers and self-users. But also the proximity to shopping facilities, hiking trails or restaurants as well as fast internet are important for most holidaymakers. For buyers who also want to use the property themselves, the proximity to their main residence plays a role. However, they are buying less and less in their surroundings or where they would like to go on holiday themselves, but rather make sure that the holiday home can also be rented out well.

If you decide to buy a holiday home as an investment, it doesn’t have to be a million-dollar villa. Even cheaper properties can generate monthly income of several thousand euros through high daily rents. Here, of course, it depends on the situation. In very good locations, holiday properties also have the best potential for increasing value, as they offer a higher resale value.

However, there are also risks. For example, a holiday home or apartment must always be rented out again. Normally holidaymakers rent accommodation for five to six days. This means that marketing costs are higher. Maintenance costs are also higher. Experts say that approximately 30 percent of revenues can be estimated for expenses such as advertising, a person on site for handing over keys or repairs. A rule of thumb for experts is not to spend more on a holiday home than twenty times the annual rent that can be achieved on the market.

The German Real Estate Association has calculated that investing in a holiday home is worthwhile if it is possible to rent it out 17 weeks a year. Because in this way the rental income exceeds the costs for the repayment of the loan.

Do you have any questions about investing in real estate? Please contact us! We will be happy to advise you.

Fotos: © terng99

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Due to low interest rates, more and more investors are pushing into the real estate markets. There are currently more and more offers for investors in the real estate portals. But there is always a risk involved, as is repeatedly shown.

At first glance, the property seems to be a good investment. At least this is how the offer is presented to the investor. On closer analysis, however, the yield calculation turns out to be more of a theoretical model. Because often – consciously or out of ignorance – essential factors, which must flow into the yield calculation, are ignored.

To find out which possibilities and potentials the purchase of a property brings, an investment calculation is the basis. All the necessary calculations can be carried out using three pillars: the investment pillar, the financing pillar and the operating pillar.

The investment pillar includes all costs associated with the purchase and revaluation of the property. Additional purchase costs include brokers, notaries, taxes, authorities and offices. It is important to specify these costs because the costs of the property can be written off for tax purposes. If individual items are missing, the tax burden increases. This means that the investor is penalized twice.

The financing pillar not only covers the individual loan modules, but also the respective conditions and additional costs, which may vary depending on the type of financing. In addition, equity capital is used to fully reflect the financing.

The operational pillar includes all income and costs of the property. To be able to analyze whether the investment is worthwhile, only the net cold rents are relevant. On the cost side, property management, maintenance, potential loss of rent as well as interest and repayments must be taken into account.

Whether an investment is worthwhile also depends on the possibilities that an investor has. Since it is valued differently for tax purposes, these factors must also be taken into account. And since hardly anyone can pay the purchase price in full, there are different individual conditions for loans, depending on the creditworthiness and equity.

The return often communicated in the exposés is a value that does not reflect the individual situation of the investor. Usually the real estate evenly does not carry itself, but the investor must still pay properly from his own fortune after the purchase.

If one considers a real estate investment with all mentioned factors, the communicated yield of 4.5 % often melts miserably together. However, the experienced investor will not be satisfied with this. The result can be significantly optimized. For example, by upgrading the property through expansion, renovation and legally permissible rent adjustments.

Want to make more out of your money? If you would like to invest in real estate, please contact us. We will be happy to advise you.

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