Rules of the game for success
Martin's answers to your questions...
Rules of the game for success
In principle, you can move into your rented property yourself. If you can imagine doing so, it is a good sign, because a property that you would move into yourself is certainly a good property. However, it does not make sense to move into the rented property yourself. Because then you won't get the tax depreciation, you can't deduct the interest on the loan and you won't have any passive income any more. In addition, it should be noted that the administration would then first have to give notice to the existing tenant for personal use. In this case, the legal deadlines must be observed, and in the case of individual properties, there may also be protection against termination of the existing tenant before terminating the tenant's own need. But in principle, you can of course move into your apartment yourself in most properties.
Equity is the money that you have available to invest. Money that is not available and therefore cannot be invested is not accepted by the banks as equity. Often parents or grandparents support the purchase with equity and this is of course very happy to be included by the financing banks. In this way, significantly more favorable financing conditions can often be realized. Equity capital can be credit balances on current accounts, savings books, savings accounts, time deposits, call money accounts, securities, deposit balances, building society savings balances, life insurance balances, investment balances, ETFs or other investments. As an alternative to equity, additional collateral can also provide significantly better financing terms. Additional collateral can be life insurance policies, annuities, existing real estate, building savings contracts or other assets. Real estate from parents or grandparents is also frequently used in practice to obtain more favorable financing conditions. Normally, however, some equity capital is sufficient for the incidental acquisition costs and the purchase price is financed entirely without any additional collateral, since the banks accept the property itself as sufficient collateral.
Part of the most important rules of the game 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 the micro-location must be assessed. Is the property in the right place, in the right part of town, or on the right side of the street, for example? The next point is the right floor plan. That is, the cut of the apartment. Does the apartment have the size that will be in demand and increase in value in the future? Is there a balcony or terrace? What are the equipment and quality of the property? Are there any obvious or hidden defects? For an existing property, has an independent appraisal been done on defects or maintenance backlogs? Is there a plan for energy upgrades to the existing property? What is the existing tenant structure or potential tenant structure at the location? What is the potential for rent increases? Are there development credits available for the loan? What are the financing options? What is the quality of management? What is the property's tax profile? In the case of new construction, what is the contractual arrangement regarding fixed price guarantee and fixed completion date? Are there sufficient guarantees? What are the references of the developer? What are the contractual arrangements and are there risks or unusual things there that jeopardize a safe investment? Is there a rental pool or rental guarantee? If not, can this be built in? These are some sample rules of the game for successful real estate acquisition. Do you want to know more about the rules of the game, do you want to get deeper insight into the selection of top properties? Then simply register for one of our upcoming free info seminars and increase your real estate knowledge there.
The inspection of real estate takes time and is time-consuming. It takes experts. After all, inspecting a location or performing a product inspection requires trained product inspectors and thus specialists who really "put a property through its paces." To have above-average success with leased properties, deep expertise is needed. Several experts must work together. For example, the property must be examined by independent experts for possible defects or weak points must be pointed out. It also needs a legal examination. It needs a detailed examination concerning equipment, qualities, building description and legal things. We recommend to buy a property that has been approved only after a detailed 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 the time of handover. The buyer and seller meet and inspect the property together. You can imagine that both parties go through the property and record defects and errors in a joint acceptance or handover protocol. In our experience, it is important that the buyer also has his own independent expert at his side. This is because the latter often sees more defects, has the necessary expertise, knows the DIN standards and also knows which deviations have to be tolerated or when it really is a defect. The surveyor also knows how to record the defects correctly, so that it is ensured that the property can really be handed over free of defects.
This joint acceptance is also very important because it marks the beginning of the five-year warranty period for a new building. A buyer who does not appear for acceptance must be invited a second time, and if the buyer or his expert representative does not appear for the second acceptance either, the property is deemed to have been accepted even without joint acceptance. This means that defects have usually not been recorded and the warranty already starts to run. The acceptance of a property takes place once in the special property. In the case of a condominium, this means the actual apartment itself. And also in the common property, that is, the things that all apartment owners share. The roof, the staircase, the heating system, the front door and the facade, for example. Almost always, the inspections for the separate property and the common property take place in two separate appointments. As the acceptance of the common property is usually very extensive and time-consuming, it is often not carried out by the buyers of the apartments themselves, but the seller and all buyers usually agree in the purchase contract that the common property will be accepted by a neutral and independent expert, e.g. the TÜV or Dekra.
As the market leader, we go a significant step beyond this. Because in addition to the usual and prescribed acceptance of a new building property after readiness for occupancy and completion, there is also the not so common regulation of a construction controlling. In this case, the entire construction phase is monitored by an independent expert. The individual trades are therefore already checked during the construction phase. The professional and DIN-compliant construction work and the correct materials are continuously monitored by TÜV or Dekra, for example. This ensures the developer and also the buyer to a large extent that hidden defects do not occur in the first place and thus long-term high follow-up costs can arise. Here is an example: when the underfloor heating is installed, the expert first comes and inspects the work of the specialist company for the installation of the underfloor heating. Only when it has been determined that everything has been processed professionally and in accordance with standards may the screed then be poured. Then the screed is removed and only after that the parquet floor may be laid. This example clearly shows where the difference lies. If only, as is often the case in the market, the acceptance takes place at the end, only non-destructive testing will be possible. So looked whether the parquet floor was laid correctly. But who has checked what the floor underneath looks like, who has checked whether the underfloor heating has been installed correctly or whether the screed has been applied correctly? Controlling during construction is usually far superior to normal acceptance alone. And, of course, it is a very valuable and important factor in ensuring that you have a lot of fun with your investment property and earn money.
In the case of a normal apartment purchase through a broker, the broker's task usually ends with the notary appointment. He has sold the property and that is usually the end of it for him. As the market leader in the Swiss Life Select Group, we advise and support our clients throughout their lives. And this continues after the notary appointment. Because we often sell our clients several properties, because whoever generates passive income once, usually buys more properties. Over and over again. This is how large fortunes are created and this is how financial independence works. That's why we don't act like a classic real estate agent, as we do with most of our brokered properties. With us it begins on the product side with the comprehensive product examination and product release. On the customer side, we first bring you "eye-to-eye", i.e. we teach you real estate knowledge. For this purpose, we offer you our regular free and non-binding real estate seminars online. If you want to know more after that, or if you want to work with us, we will add you to our exclusive preferred list, giving you preferential access to real off-market properties. This is also free of charge and without obligation for you. Afterwards we will present you every possible suitable object, which will be released for the sales start after our comprehensive examination, still before the start on the market, exclusively and in advance. You will receive an e-mail in good time.