Microapartment – You want to buy an apartment? There are many options to choose from. The microapartment has become a very sought-after property on the German market in recent years, making it an excellent investment. More and more people are moving to the big cities and due to the proximity to the city center, the flexible design and the comparatively low rents, micro apartments are very much in demand. You want to invest in buying a microapartment or rent it first? In this article you will find many useful tips, advantages and disadvantages around this special type of real estate. Click here to go back to the overview of the most common types of apartments.
Microapartment: What is a microapartment? – Definition & Features
Due to the many variants and the different requirements, there is no uniform definition for the term microapartment. In German-speaking countries, a microapartment is a small, furnished apartment with usually one to two rooms and a size of approximately 19 to 36 square meters.
Read more about the conventional apartment here.
Features of a micro apartment
Micro apartments are in most cases rented furnished and are often equipped with futons or pull-out beds, fold-out tables and small or hidden appliances. In some cases, the cost of electricity or internet is also already included in the lease. There are also often common areas such as fitness rooms, rooftop terraces or sports courts.
- Often furnished
- Space saving device
- Electricity, Internet included in rental contract
- Common areas: Fitness rooms, roof terrace, etc.
Advantages & disadvantages of a microapartment: costs, return & co.
Before you invest in an apartment, you should look at the advantages and disadvantages of each type of apartment. This will help you decide whether this type of apartment is right for you and whether you can accept the disadvantages. Especially in the case of an old building apartment, the construction method is different from that of new buildings. We have compiled a list of the most important aspects for you, so that you can make the right choice.
Advantages: High yield, safe, central
Micro apartments have a very decisive advantage: location and location. This type of property is mostly found in the inner cities and very central. So if you want to live in the city but spend little, a micro apartment is just right.
If you want to invest in a micro apartment, you can be sure of one thing: While your real estate investment will require a manageable amount of capital, the rental yield and rental income will be higher than those of other apartments, such as the old building apartment, the loft or the floor apartment. In addition, they are a safe investment, which is worthwhile for investors with a long time horizon. Precisely because demand exceeds supply, you as a landlord have a high degree of rental security.
- As a real estate investment, microapartments require a manageable capital investment
- Yield and rental income are significantly higher than those of conventional apartments
- Investment is worthwhile for investors with a long time horizon and a pronounced need for security
Disadvantages: Small, furnished
What is an advantage for some may seem a disadvantage for others. Furnished micro apartments exclude the possibility of bringing your own style or furniture into your four walls. In addition, the apartments are very small and offer little living space.
- Narrow, small
- Mostly furnished
Microapartment: Who is it right for? Singles, couples, second home
The target group for small apartments consists mainly of the young, working singles, who are on average younger than 30 years. But microapartments are partly also suitable for couples and shared flats, as well as older re-singles who do not need much space. Microapartments are also often used as second homes.
Singles: Flexible, central
Micro apartments are especially popular with young adults. Often these properties can be found in the middle of the city center and are therefore ideal for students and singles. The proximity to the university and the flexibility that one has as a result is also a great advantage. Most of the time, these types of properties are already fully furnished and therefore ready for immediate occupancy. This is a great advantage for young people who are new to a city.
Seniors: Cheap, modern
Similar to young singles, this type of property is particularly suitable for single seniors who still want to live in the city and centrally, as well as cheaply.
Couples: space for two
Contrary to popular belief, a micro apartment can also be beneficial for young couples. Despite the small square footage, with the right and efficient furnishings and room layout, the apartment can be especially cozy and provide enough space for two people. In addition, you save money with the rent.
Secondary residence: vacation home, commuter
For example, if you live in the country and commute to the city for work, you can buy or rent a micro apartment a second home. This saves time and, depending on the distance, even costs. But microapartments can also be bought without a special purpose and rented as a second home or vacation home.
What you should consider before buying/renting a microapartment
Especially with older buildings, it is very important to get your own idea of the apartment before buying/renting. Inform yourself exactly about the construction and the building to be prepared for everything. We have summarized these for you so that you can clarify everything in advance and no unexpected costs await you later.
What to consider when buying?
First of all, you should find out about the condition of your potential property. Old buildings often require renovation and modernization, which can lead to additional costs. We recommend that you consult a specialist and a realtor who can help you with the purchase decision and give you an insight into the costs involved. It is possible, for example, that the exterior façade is damaged and moisture can get into the apartment, causing mold. It is also not uncommon that the statics of old properties need to be repaired to ensure stability. Repair work is also sometimes necessary. So let a specialist help you so that nothing can go wrong. Whether it’s an existing property or a new build – an expert will not only help you with the property valuation by year of construction, but also with the technical inspection and commercial inspection of the property.
- Structural condition
- Repair work
Viewing appointment: What to consider & checklist
You invest in real estate and this decision should not be taken lightly. Investments are always a good idea, but especially with old buildings you have to pay attention to some things, so that no unexpected costs reach you. We have compiled a checklist with the most important aspects that you should consider during an inspection to buy or rent.
What to consider? – Condition, floor plan and location
Look at the condition of the apartment. Depending on the year of construction, every property has its defects. What is the floor plan of the apartment and does it meet your expectations? Often you have to adapt it to the property. Note the location and infrastructure of the apartment, this could increase or decrease the price at which you would sell the apartment. Are the kitchen and bathroom built in and what are the ancillary purchase costs and operating costs? Is the micro apartment rented or unrented? These are just a few aspects to consider. We have put together a checklist for you in the following.
Checklist: For your viewing appointment
- Service charges
- Internet supply
- Condition (in need of renovation)
- Floor plan
- Kitchen/ Bathroom
- Additional rooms
- Heating, water, electrics
Broker: safe investment with top – broker – costs, process & co.
Condominiums, such as micro apartments are ideal as an investment and are a very safe investment. Especially if you do not have much experience with the purchase of real estate, we recommend that you consult a real estate agent. He or she will advise you on important issues, find properties for you and visit the apartments with you. Real estate investments are not designed for a short-term increase of money, but rather for a good retirement provision. Therefore, you should approach the matter very carefully and get good advice.
Procedure of real estate purchase
First of all, you will consult with the real estate agent and you will have the opportunity to express your wishes. The real estate agent will now tell you what is possible and he will start with the first research.
Then begins the organizational management. Documents and records are obtained, which are important for a purchase of a property. Then the broker starts to find out potential sellers and condominiums for you. Viewing appointments are organized and carried out.
Last but not least, the negotiations begin. Negotiations are held with the seller and the purchase agreement is drawn up. Afterwards, the broker is present at the handover of the keys and ensures that everything runs smoothly. Even after the contract is signed, the broker will be a contact person for you.
You are looking for a professional broker and want to learn more about the benefits? Take a look!
Financing a condominium: loan or equity?
Do you want to fulfill your dream of owning a condominium or invest in an apartment in an old building and then rent it out? Then you should inform yourself in detail about the financing of such a property. You have to decide on the right real estate loan and should obtain and compare many different offers in this course. The choice of loan ultimately determines how high the total cost of your real estate loan. So it’s best to get advice and make the right decision.
Real estate loans and financing: tips, checklist and more
Financing a property can be done in many ways. Here you will find some of the financing options listed with brief summaries. In addition, you will find a link that will take you to more comprehensive articles.
Real estate loan
- Real estate loan adapted to personal needs
- Flexibility should be ensured
- Proper planning is important
Financing of an apartment
- No house but only apartment to finance
- Comparison of different housing financings recommended
- Real estate financing