Investment in real estate is one of the most popular forms of investment. A home or a condominium is the goal of many people and gives a sense of security. Homeownership can also be used in old age and increases the monthly income as a rented unit.
Additional income through rental
Real estate is therefore inflation-proof, ensures stable returns and involves only a low risk. With a lucrative second income through the letting many citizens want to provide for their pension. For home or apartment purchase, however, a certain equity is necessary. Experts advise against a real estate purchase, if sufficient financial resources are not available. According to financial experts, the purchase of real estate should be financed by at least 20 to 30 percent of its own capital.
In addition, homebuyers should have additional financial reserves of at least three net salaries. This sum serves as security for emergencies and expenses such as repairs, renovations and new acquisitions around the purchase of real estate. Who uses the house or the apartment itself, receives tax benefits. The maintenance costs are partially credited to the income tax.
Labor costs of 1,200 euros per year can be claimed in the tax return. Modernization measures on facades, roofs, windows or on heating or sanitary facilities have a tax-reducing effect. The resulting costs can be completely stated. If the property is to be rented, costs for the newspaper advertisement can be deducted as income-related expenses.
Sufficient financial resources necessary
When purchasing real estate, government subsidies can also be claimed. Loans or Bauspar contracts, which are taken up with the purpose of a real estate purchase, are promoted by the state. The bonus depends on the number of people living in the household. Subsidies for children are significantly higher than for adult family members. If the subsidized property is sold again, the amount must either be invested in a new residential property or returned to the Bauspar contract within the next four years, otherwise the sum can be reclaimed by the state. Many property buyers therefore prefer to take out a loan.
However, this is not always easy, especially in the case of negative Schufa.Who is interested in a loan despite negative Schufa, can be informed in advance in a comparison portal. With Score Kompass you can find the cheapest loan by comparing the credit conditions of different providers. With the loan amount both an existing property or a new building can be acquired. Experts recommend that when buying a used property to have a detailed report created in order not to have to accept later disadvantages in terms of a poor building fabric or damp walls.
Summary – Is a property worth investing?
Whether or not a property is worth investing depends on numerous factors. These factors should already be known before buying a property. At the same time the calculation of the financing is very important as well as a sufficient opinion. Only those who know the exact costs and include not only the pure financing costs but also the maintenance costs, will sometimes be able to use their property as an investment.