Rules of the game for success

In principle, you can move into your rented property yourself. If you can imagine doing this, it is initially a good sign, because a property that you would also move into yourself is certainly a good property. However, it is not sensible to move into the rented property yourself. This is because you would then no longer receive tax depreciation, could no longer deduct mortgage interest and would no longer have any monthly passive income. In addition, it should be noted that the management would first have to give the existing tenant notice to quit on the grounds of personal use. Statutory notice periods must be observed in this regard, and for individual properties there may also be protection for the existing tenant against termination for personal use. But in principle, you can of course move into your flat yourself with most properties.

Equity is the money that you can invest. Funds that are not available and therefore cannot be invested are not accepted by banks as equity either. Often, parents or grandparents support the purchase with equity, and this is of course very much welcomed by the funding banks. This often allows for significantly more favorable financing conditions. Equity can take the form of deposits in current accounts, savings accounts, savings accounts, fixed deposits, day-trading accounts, securities, deposit accounts, life insurance deposits, investment deposits, ETFs or other investments. Alternatively to equity, additional collateral can also provide a significantly better financing condition. Additional collateral can be life insurance policies, pension insurance policies, existing real estate, savings contract agreements, or other assets. Properties owned by parents or grandparents are also often used in practice to obtain more favorable financing conditions. However, in normal cases, a certain amount of equity is sufficient to cover the acquisition costs, and the purchase price is financed entirely without any additional security, since the banks themselves accept the property as sufficient collateral.

Part of the most important rules of thumb in real estate is location, location, location. This means that the property is located in the right city, in the right region. If this is the case, then it is necessary to assess the micro-location. Is the property in the right place, in the right neighborhood, or, for example, on the right side of the street? The next point is the correct layout. That is, the layout of the apartment. Does the apartment have the size that is in demand in the future and that will increase in value? Is there a balcony or terrace? What is the property’s equipment and quality? Are there obvious or hidden defects? Was an independent appraisal of defects or maintenance backlog performed on an existing property? Is there a plan for the energy retrofit of the existing property? How is the existing or potential tenant structure? How is the rental potential? Are there funding credits for the loan? What are the financing options? What is the quality of the management? What are the tax parameters of the property? In a new build, how is the contractual arrangement regarding fixed price guarantees and a fixed completion date? Are there sufficient guarantees for this? What are the references of the developer? How are the contractual arrangements and are there any risks or unusual things that endanger a safe investment? Is there a rental pool or a rental guarantee? If not, can one be installed? These are some exemplary rules of thumb for successfully acquiring real estate. If you want to know more about the rules of thumb, would you like to gain a deeper insight into the selection of top properties? Then simply sign up for one of our upcoming free information seminars and enhance your real estate knowledge there.

The inspection of real estate takes time and is time-consuming. To do this, you need experts. To inspect a location or perform a product inspection requires trained product inspectors, and therefore specialists who truly examine a property “from the inside out.” To achieve above-average success with rented properties, deep expertise is needed. Several experts must work together. This means that the property must be inspected by independent experts for any potential defects or weaknesses. It also requires a legal review. It also requires a detailed examination of equipment, qualities, construction specifications, and legal matters. We recommend purchasing a property that is not released until after a thorough inspection process, because every mistake costs a lot of money in the long run.

In the case of newly built properties, a joint inspection takes place at handover. Buyers and sellers meet and jointly inspect the property. It can be thought of as follows: both parties walk through the property and record any defects in a joint inspection or handover protocol. In our experience, it is important that the buyer also has an independent third-party expert on their side. Often, this expert has the necessary expertise, knows the DIN standards, and also knows which deviations must be tolerated or when a defect actually exists. The expert also knows how to properly record the defects so that the property can truly be handed over without any defects.
This joint inspection is also very important because it starts the five-year warranty for new construction. A buyer who does not appear for the inspection must be invited a second time, and if the buyer or their qualified representative does not appear at the second inspection either, the property is considered to have been inspected without a joint inspection. This means that defects have often not been recorded and the warranty already begins to run. The inspection of a property takes place once in the condominium. In the case of an owner-occupied apartment, it is the actual apartment itself. And in the case of a community property, that is, the things that all apartment owners use together. The roof, the stairwell, the heating system, the front door, and the facade, for example. Almost always, the inspections for the condominium and the community property take place on two separate dates. Since community property is usually only very extensively and elaborately to be divested, this is often not taken away by the buyers of the apartments themselves, but sellers and all buyers usually agree in the purchase contract that the community property will be taken away by a neutral and independent expert, e.g. the TÜV or the Dekra.

As market leaders, we go a significant step beyond the usual and required inspection of newly built properties after completion of construction. In addition to the usual and required inspection of a newly built property after completion of construction, there is also the less commonly used practice of building control. In this case, the entire construction phase is monitored by an independent expert. The individual trades are therefore checked during the construction phase. The professional and DIN-compliant construction quality and the correct materials are continuously monitored by, for example, TÜV or Dekra. This largely ensures that no hidden defects will arise at all, and that this could result in high long-term follow-up costs. Here is an example: when the underfloor heating is installed, the expert first comes and takes over the work of the specialist company responsible for installing the underfloor heating. Only when it has been determined that everything was carried out according to the technical standards and regulations is it then allowed to pour the screed. Then the screed is removed and only after that the parquet floor can be installed. This example clearly shows where the difference lies. If the inspection only takes place at the end of the process, as is often the case on the market, only non-destructive testing can be carried out. That is, it is checked whether the parquet floor has been installed correctly. But who has checked what the underfloor looks like underneath? Who has checked whether the underfloor heating has been installed correctly or whether the screed has been applied correctly? The on-site monitoring of the construction process is usually clearly superior to the standard inspection. And of course, a very valuable and important factor to ensure that you have a lot of fun with your real estate investment and earn money.

With a normal apartment purchase through a real estate agent, the real estate agent’s task usually ends with the notary appointment. They have sold the property, and with that, everything is usually done for them. As the market leader in the Swiss Life Select Group, we advise and support our customers for a lifetime. And this continues after the notary appointment. Because we often sell several properties to our customers; because whoever generates passive income once, usually also buys additional properties. Over and over again. This creates large fortunes and financial independence. That’s why we don’t operate like a traditional real estate agent, as is the case with most of our properties. On our product page, we start with a comprehensive product review and approval. On the customer side, we first bring you “on equal footing”; in other words, we provide you with real estate knowledge. For that, we offer you our regular free and non-binding real estate seminars online. If you want to learn more or want to work with us, we will add you to our exclusive preferred list. This way you will have preferential access to real off-market properties. This is also free of charge and non-binding for you. After that, we will present you with any suitable properties that are released for sale after our comprehensive review, before the launch on the market, exclusively and in advance. You will receive an email in advance.