Partial sale apartment: disadvantages, advantages, costs – condominium partial purchase
Partial sale apartment 2023 – old building apartment, attic apartment or apartment with terrace and property, many have in particular in the age a problem, the apartment becomes “too large” and the money somehow “ever less”. For many, the partial sale of your condominium seems to make sense. A look at the advantages, disadvantages and costs (including alternative mortgage loans). You can also find an overview of partial sale providers here. Back to Partial Sale Property.
“Sell half of the apartment”
Sell quickly, get money quickly, that’s what more and more want, who find at an advanced age that their own 4-walls are getting too big. Whether 3-room apartment, 4-room apartment or even comfortable 5-room and more.
Those who want quick money for the condominium, more and more often looking for “partial sale apartment”. Because one hears of many advantages: Fast, uncomplicated, no credit check. That’s true, but there is also a disadvantage, the user fee, which you pay monthly afterwards.
The different sellers buy apartment shares between 20% – 50%. If the market value of your condominium is in the 7-digit range, you can sometimes sell “only” 10% of the apartment.
- Up to 1 million value = 10-50
- Over 1 million value = 10-50
Here schematically shown with 20% sold share, a 3-room apartment:
Partial sale condominium: what is it?
First, let’s start with the definition of the partial sale of an apartment.
What is the partial sale of an apartment?
As described at the beginning, you sell apartment shares between 20% – 50%. You sell the shares to a financial company. This makes you a condominium owners’ association consisting of two parties. In return you get the proportional purchase price quickly transferred, independent of banks / loans.
Fast money, sounds great or?
Whether selling in Berlin, Hamburg, Munich, Cologne or even “smaller” cities, there are advantages to paying the purchase price quickly without any credit check (compare credit at the bank). But there are also disadvantages: The user fee and likewise with the total sale.
Usage fee = rent for your apartment
After partial sale = you have to pay usage fee
The finance company becomes the partial owner of your apartment. However, you remain the sole user of the apartment. Therefore, from now on, you pay a monthly usage fee, quasi “rent” for the part of your condominium that no longer belongs to you.
Depending on the provider, this usage fee is approximately ~ 3% p.a. (per year). A simple, quick calculation of the usage fee.
- Usage fee (ETW): 3% p.a.
Formula usage fee (depending on the provider) per month:
- Monthly usage fee = 3% * purchase price (share) / 12
- = 3% * 100.000 / 12
With this you pay 250 euros per month.
User fee at 100.000 Euro = 250 Euro / month
As always, depending on the provider. All providers can be found here in the partial purchase apartment: comparison.
This is how the financial company refinances itself.
Disadvantage? User fee vs. credit
Uncomplicated and fast money for the condo, this is a really tempting offer. That is why you should take a second look at the various partial purchase offers for apartment.
Those who resort to the really simple sales offer, quickly get money. But for this, you pay – as learned – the monthly user fee. Many use the offer because you think, I can not get a real estate loan, especially at an older age.
At the same time, a real estate loan is much cheaper! Especially at the current interest rates. Currently you pay here only 1% p.a., instead of 3% or more, as with the partial sale.
Comparison partial sale / credit:
- Partial sale / month = 250 euros
- Mortgage loan / month = 85 euros
So remember, simply put:
Real estate loans are (currently) 66% cheaper!
So it’s worth talking to your local bank and maybe 2 or 3 alternatives.
Partial sale of real estate: advantages, disadvantages, tax & Co.
Read more about partial sale here – A look at costs of use, advantages, disadvantages, the total sale, the calculated increase in value under inflation and a comparison, what is “cheaper”: partial purchase or the alternative real estate loan, more specifically the mortgage loan? In addition taxes, sale from community of heirs, divorce and much more. My recommendations for sellers!