What types of property are there?

We answer these and many other questions in our video blog episodes.

Here is the transcript of episode 35 to read along:

If you are looking for passive income or property income, there are very different types of property. We will start with new or used. Do you prefer used properties, meaning existing properties, or would you rather buy a new-build property? These are questions that have to do with the ecological aspect of a property. With existing properties, you will rarely have modern, future-proof, ecological properties, whereas you naturally have those with a new build. On the other hand, with a new build, completion sometimes takes a few months and you have to factor in a construction phase.

Then there is the listed property. A listed property brings you extremely high tax advantages, specifically when it is a listed new build, so classically a new-build property, but where the plot of land or the property is listed, then you get very, very high tax advantages.

When we are talking about existing property, new builds or listed buildings, there are differences in the type of use. Are you buying a classic flat to let, or are you perhaps buying a micro-apartment, a furnished micro-apartment in a location where furnished micro-apartments are also in demand and do well? And then there are care properties. Are you buying a flat in a care facility? That is a very high-risk area, because there is, after all, an operator who has to run this care property. And you are dependent on the commercial success and the integrity of this operator. That is an area where I very, very rarely operate, because I believe that a higher risk often does not pay off, because the additional yield is not really all that significant. But if you have any questions about that, then it is also worth talking about it.

And of course there are also special types of real estate like block of flats. You don't buy just one flat, but a whole block of flats at once. That too can have disadvantages. For example: a lack of diversification. So you see, there are very different types of property and it makes sense to first get an overall overview of what works out financially for you. The type of property is always the right one when it suits you, your situation, what you can afford and what pays off for you.

That is why I recommend focusing less on whether you are buying a micro-apartment, a traditional flat, a listed building, a newly built listed property, a new-build or an existing property, and more on what is right for you individually.

Keywords:
Existing properties, new-build property, listed building, care properties, micro-apartment, furnished micro-apartments, apartment blocks