FAQ Ans 1 – A foreign citizen may apply for mortgage provided he can submit proof of at least 1,400 EUR monthly salary. If he is a self-employee, he will require presenting 3 salary statements or two tax statements.
The amount of funding is dependent on the assessment of the property. Usually, it is 50-54% of the value at fixed interest of 3.25% (10 years term) while repayment is 1% of the fund.
FAQ Ans 2 – Whenever the interest is lower than the return on the income it pays to take a mortgage. In doing so, you actually create leverage and the return on your own capital grows.
FAQ Ans 3 – Mortgage interest is tax deductible. It will be offset against rental income.
FAQ Ans 4 – The total amount of all additional expenses will be approximately 12.5 – 16% as follows:
6% purchase tax
2.5%-3%-notarization (1.5% notary fee, 1% registration fee, 0.5% managing fee for notary trust account)
1% mortgage broker (if funding requested)
3%-6% real estate brokerage (depending on property)
FAQ Ans 5 – The law protects a tenant holding a standard German rental agreement as follows:
1. As long as the tenant meets all his financial obligations (rent, maintenance, authorities etc.) he can stay in the apartment for an unlimited period.
2. In accordance with the ‘Mietspiegel’ limit, the rent increases up to 15% within 3 years, up to the maximum.
FAQ Ans 6 – He will get a demand notification at first. A legal eviction initiates, if he still does not meet his obligations and pay his dues within 3 months.
FAQ Ans 7 – The management company is in charge of two areas:
1. Technical management/services – cleaning, maintenance, renovation of the building, insurance of public space and continuous reporting to the home owners.
2.Rent management -locating new tenants, signing the contract, collection of rent and additional costs, overseeing payments to authorities, general care of tenants, controlling rent increase.
Choose a company that practices proactive rent management, to ensure maximum profit.
FAQ Ans 8 – ‘Sweet Home’ offers its customers full guidance and support, starting from analyzing the customer’s requirements and needs to locate the most adequate property and the most attractive investment package for him.
1. Locating the adequate property in a good location and at a reasonable price.
2. Coordinating and guiding the financing procedure at the mortgage bank through closure.
3. Personal guidance through the notarization process/signing of the contract.
4. Assistance in finding the most attractive funding package for the investor.
FAQ Ans 9 -Needless to say that we shall gladly sell your property for you. However, it will be for you to decide, whether to handle it on your own or possibly use a local real estate broker.
The buyer’s market in Berlin consists of both, investors and locals, who realized that, due to increasing real estate prices and rents, they have to act quickly and purchase property.
FAQ Ans 10 -When choosing Berlin as an attractive investment the focus is on capital gain when selling the property rather than profit from rental income. The gap in real estate prices between Berlin and other major German cities such as Munich, Frankfurt and Hamburg is still very big and even bigger compared to European metropolises such as Paris, London and Amsterdam.
FAQ Ans 11 – The way you deal with other properties, the same applies to this issue. If you usually insure your property/equipment you could definitely acquire a similar insurance in Berlin.
FAQ Ans 12 – Basically yes.
In general, the management company has to be notified in writing and will arrange the visit with the tenant. Notification of the planned visit should be given at least 2 weeks ahead.
Nevertheless, the following possibilities are important to consider:
1. The tenant will agree and be present at the agreed date.
2. The tenant will not show up and give a reason for not being able to be there.
3. The property gets sell prior to the set date.
4. The owner has already practiced his visiting rights (up to 4 times a year) – no further visit is possible.
FAQ Ans 14 – The rental agreement shows the day of commencement, the tenant’s name and his date of birth only.
FAQ Ans 16 – In fact , the only authority appointed by the government to perform real-estate deals and request listing of a property in the land register is a public notary. After signing the acquisition contract, the registration processes further. (notarization)
FAQ Ans 17 – The money stays in the fund exactly as the money that was there when you purchased the property.
FAQ Ans 18 – First of all, that’s a reason to celebrate. A new rental agreement means a significant capital gain, at times twice as much in profit. You can look for a new tenant and collect the maximum applicable rent or, if you wish, consider selling the property. Due to shortage in empty apartments its selling price would be about 30% more than that of an occupied apartment.
FAQ Ans 19 – One option is to report to the management company and let them take care of it. The owner gets the invoice.
In case insurance coverage exists for this type of damage, the insurance will take over.
FAQ Ans 20 – 1. Full service in Hebrew/English/German/Russian, close to home, high accessibility.
2. Excellent customer service, full guidance throughout the whole purchase process including financing and notarization.
3. In most cases, we charge you 50% less for our broker services than local agents would.
FAQ Ans 21 – Although you might naturally be curious, truth is that there is little meaning in visiting the property. Let’s assume you visited the apartment and liked it, let’s assume the tenant moves out after 10 years, will it still be in the same condition? Probably not.
At times, a touch up may be necessary or it might even be in a better condition than before. The locals usually take good care of their apartments and sometimes even renovate themselves. Therefore, it is not crucial to visit the apartment. Should you insist, we will of course arrange for a visit, after notifying the management company and the tenant, taking the local terms/limitations into consideration.