Evaluate apartment building in under 5 minutes

Let’s start with a case that could happen to you today:

Imagine an acquaintance sitting next to you in a café and saying: “Someone here in the street wants to sell an apartment building, I knew the old lady, her son is now looking after it. I’ll ask about it for you.” A day later, you receive the figures on WhatsApp: 240,000 euros annual rent, purchase price is said to be 8.5 million, A-location. Sounds exciting – but is it really a good deal?

The important thing is that you only need two figures – the purchase price (PP) and the annual net cold rent (ANR). Once you have these, you can immediately calculate the purchase price factor and the yield. Both are the most important key figures for recognizing whether an investment makes sense or not.

Another tip: Whether you’re looking for a return on investment or a purchase price factor, use my free real estate calculator on Immobilien Guru.

Stream here for free – the fastest real estate valuation in the world

Calculate purchase price factor and yield

Example:

• Purchase price: € 8,500,000
• JNKM: € 240,000

Now you can get started right away:

Purchase price factor = purchase price / JNKM = 8,500,000 / 240,000 = 35.4

A purchase price factor of 35 means that it takes over 35 years to recoup the purchase price through rental income – without costs, without interest, without risk. Far too long.

How much return are you making?

You can also see this immediately:

Yield = JNKM / purchase price = 240,000 / 8,500,000 = 2.8 %

Sounds okay at first – but is it really?

The magic limit: 5.5% or more – applies at current interest rates of 3.5%

If you work with borrowed capital – and almost everyone does – you have to take the current interest rates into account. Let’s assume you get 3.5% interest. Then realistically add around 2% for maintenance and reserves. That makes a total of 5.5 %.

So you only earn from a return of over 5.5 %

With a return of only 2.8%, you are making a loss month after month – despite rental income.

How much should you pay at most?

Here’s the trick: simply reverse the formula. You want at least 6% return? Then:

Purchase price = JNKM / desired return Purchase price = 240,000 / 0.06 = € 4,000,000

At a yield of 6%, the property should cost a maximum of €4 million. With an 8 % yield, it could even be as low as € 3 million.

Example: You want 8 %

Purchase price = 240,000 / 0.08 = € 3,000,000

Anything above that is not financially attractive – or you have to negotiate the purchase price down.

That’s all you need to remember in the first step, with a quick assessment from your smartphone or notebook! Are you getting an offer? Ask for the address, purchase price, JNKM (renovation status, rental status, …) – then you can evaluate quickly and the seller can sell their apartment building quickly.

Conclusion: “Only 2 numbers decide” – to put it simply

All you really need:

• The annual net cold rent (JNKM)
• The purchase price

Then compare that with the current financing costs and the 2% maintenance buffer. From a return of 5.5 %, you are in the black – anything less is a risk or a hobby.

Formula for your everyday life

Desired yield / JNKM = maximum purchase price

Keep this formula in mind – you’ll need it more often when you’re checking real estate offers. It will tell you in seconds whether a property is suitable or not. And even better: you can immediately make the seller a realistic offer.

Is 8.5 million a good deal?

I went into this in detail on immobilien-erfahrung.de, you can read about it again here: The difference between yield and investment properties.

The difference lies in the focus: with an investment property, what counts is what comes into your account each month – i.e. a positive cash flow from rental income, usually in B locations and C locations. With an investment property, on the other hand, you focus on long-term value appreciation and sales proceeds – usually in A-locations such as Berlin, Cologne, Düsseldorf & Co.

You want direct cash? The first option brings you income directly. Do you want more cash in the long term? The second requires patience, capital and market knowledge – in return, you can expect a big profit later on.

Even better:

If you buy cheaply in an A-location, all the better Cash flow + long-term cash = top class. Buy, upgrade, increase rent, increase value.

That’s it. This is how you evaluate extremely quickly. Good luck with your investment!

Your purchase price offer therefore always depends on your personal goals: Do you need / want operational or strategic cash.

What would this property with a net annual rent of 240,000 euros in an A-location be worth to you?

More tips from the field?

Do you want to regularly recognize good deals, make faster decisions or simply learn from my experience? Then browse through the blog or read the most important articles on the topics – step by step, from practice, for investors.

I have explained these topics to you in detail:

• Valuate apartment building
• Calculate purchase price factor
• Tip: My purchase price factor calculator
• Estimate returns correctly
• Financing with leverage

You want to sell or have questions? Then write to me – I’ll be happy to help you.

• Contact us now
• Purchase profile

Lamps & Light: Feel good through change

One thing is certain for you: a change is needed. What could be worse than coming home from a hard day at work, lying down on the sofa and still just not getting any rest? Little, because resting after a strenuous period is necessary for the body to gather strength for the next day. Otherwise, it is possible that the whole thing ends in a breakdown or you get sick. To prevent this, it is important to find out what is disturbing your well-being in your own four walls. Is it the placement of the furniture, the wrong wall color or can it be the light that negatively affects the well-being.

Different lamp styles: from retro style to shabby chic

Lamps about lamps, there are the most different designs. Since everyone has different tastes in furnishings, there are also different styles for lamps. You’ve probably noticed it before, the current lamp trend: geometric shapes. You will find the differences not only in whether it is a floor lamp or a ceiling lamp, but also in whether it is a lamp in vintage style or country style. A lamp that hangs in the middle of the room with a lampshade made of petals gives the room a playful, fresh impression and a lamp that is made of glass looks more noble and high quality.

Effect of light colours

If the optics are right, doesn’t the light matter? Absolutely. On the one hand there is the glaring light that reminds you of a sterile doctor’s office and on the other hand a light that slowly gets brighter and brighter, so that you can always get used to it first. Especially when it comes to the bedroom, where you don’t necessarily want to be woken up with bright light in the morning, it makes more sense to use a light bulb that slowly brightens up. This is in complete contrast to the kitchen or the bathroom. When you are in these rooms, you usually want to know what you are doing and are then quite happy to have the light. Think about a lighting concept for each of your rooms, because this is the only way to create the optimal feel-good feeling. Technically, a distinction is made between warm white, neutral white and daylight white. While warm white is perceived as cosy, neutral white conveys a businesslike atmosphere and daylight white is suitable for incident light.

Lamps & Light in Berlin: The best recommendations

You come from the capital Berlin and can’t find your way between the countless lamp shops? That is more than understandable, because to find out which shop is best suited for your personal needs and at the same time not too far away, is not so easy. We have picked out the best lamp shops in Berlin for you on the basis of Google reviews. Based on this listing you have the opportunity to find the right shop, because there are specialists for the advice, the assortment or the repair.

Antique Lamps Scherler GmbH

Rating: 4.6 / 5.0

In the shop Antike Lampen Scherler GmbH you can not only get expert advice and inspiration. Here you have the opportunity to have your favorite pieces repaired. The customers are especially enthusiastic about the high-quality repair.

• Gervinusstrasse 15
  10629 Berlin
• Phone: 030 3233427
• Antique Lamps Scherler GmbH Website

L. & M. Lee Lamps Berlin

Rating: 4.7 / 5.0

• Uhlandstrasse 95
  10717 Berlin
• Phone: 030 2044723
• L. & M. Lee Lamps Berlin Website

Rainbow lights

Rating: 4.8 / 5.0

• Bismarckstrasse 45-47
  10627 Berlin
• Phone: 030 200042163
• Rainbow Lights Website

Design location *light, lamps & luminaires

Rating: 4.8 / 5.0

• Oderberger Str. 42
  10435 Berlin
• Phone: 030 44318090
• Design location *light, lamps & luminaires* website

Lamps Schirner

Rating: 4.8 / 5.0

• Tempelhofer Weg 36
  12347 Berlin
• Phone: 030 63223394
• Lamps Schirner Website

Sac-à-perle

Rating: 5.0 / 5.0

• Prenzlauer Allee 41
  10405 Berlin
• Phone: 030 42025383
• Sac-à-perle website

Light bulbs

Rating: 4.3 / 5.0

• Knobelsdorffstrasse 8
  14059 Berlin
• Phone: 030 3213124
• Lichtblick Lamps Website

Light House Moabit

Rating: 4.3 / 5.0

• Tower road 78
  10551 Berlin
• Phone: 030 3913746
• Lichthaus Moabit Website

Preacher Light Advisor

Rating: 4.1 / 5.0

• Hardenbergstrasse 20
  10623 Berlin
• Phone: 030 6640510
• Preacher Light Consultant Website

Berlin brass lamps

Rating: 5.0/5.0

• Sickingenstrasse 20-28
  10553 Berlin
• Phone: 030 3907240
• Berlin Brass Lamps Website

Lampshades Wicher

Rating: 4.7 / 5.0

• Albrechtstrasse 116
  12167 Berlin
• Phone: 030 7920845
• Lampshades Wicher Website

Berlin city map for directions

Lamps & Light: Ideas to make yourself

No matter which store you visit, you just can’t find a lamp that meets your expectations? You have already searched every shop in your area and are about to give up? Have you ever thought about building a lamp that ideally meets your expectations yourself? Few people think about it, because many assume that it is simply too difficult. But you are wrong, with good instructions and a little artistic skill you can succeed in building your dream lamp itself. We have selected a few videos for you, which you can either copy or be inspired by.

Designer lamp build yourself

Anyone who sees this lamp usually thinks that it must have been very expensive to purchase. Much less suspected that a layman might be able to make this designer lamp itself. But this is also possible. In this video you will learn step by step how to go about it. If it is then so far and you have found the time and motivation to finish the lamp, it is ideal for the living room or the kitchen. In the living room, the lamp fits perfectly over the dining table because of its elongated shape. In the kitchen, on the other hand, it provides sufficient light over work surfaces.

DIY wire ball lamp

What effect does this lamp have on you when you look at this picture? Most people will answer this question: it looks cosy, warm and calming. This is not without reason, because it spreads a warm white light and not only that, because influenced by the shape and style, most people immediately imagine this lamp in the living room or bedroom. If you are dissatisfied with the light in your living room or bedroom and you would like to make a suitable lamp yourself, then the wire ball lamp could be the right idea for you.

Creative dining table lamp

This creative dining table lamp is just the thing for you if you are looking for a real eye-catcher. Through the old bottles, which are cleverly transformed into lampshades, a cozy warm light results. By making this lamp, not only old objects are used wisely, but a special atmosphere is created. For this reason, this lamp is suitable for the living room. In the living room, one spends a large part of his time, whether to eat or relax on the couch. Even when visitors are expected, most of the time is spent in the living room. This gives the chance that guests can also admire the homemade work.

Prevent foreclosures – The options

As soon as one has been informed about a foreclosure, the worries and fears are great. From many quarters in this situation comes the phrase, “You can’t stop a foreclosure.” But how hopeless is this situation really? What options are there to fight the foreclosure proceedings? We have listed 4 options for you that may be able to help you.

The way out of the foreclosure – negotiations with the bank

Keep calm and consider what course of action would be best for you. The best way to escape foreclosure is to negotiate with your bank. Not only does your current financial situation play an important role, but the forecast of your future financial situation also plays an important role. A bank will only be interested in agreeing to a new deal if there is a good chance that the installments will be paid on time in the future. It is particularly important that you act in good time when you learn of the enforcement proceedings.

Deferment of installments

This option is recommended exclusively for people who can say with certainty that they will have more money available again in the future. The core of this option is the deferral of the installments. A deferment means the suspension of one or even several loan installments. The bank will agree to this option only if there is an improvement in the financial situation in the future.

Reduce or suspend the repayment rate

One way to prevent the foreclosure of your home is to reduce or even suspend the repayment to be paid. To make this option a reality, you should talk to your bank. The likelihood that they will agree to a new arrangement with you is not that small, as the bank often does not benefit from a foreclosure either. This procedure is particularly useful if it is foreseeable that you will have more money available again in the future.

Reschedule

Another possible option in the event of an impending foreclosure is to reschedule. Rescheduling means taking out a new loan to pay off an old loan. Rescheduling only makes sense if you have to pay less interest on the new loan than you did on the old one. It is important to constantly try to reduce your interest costs. You can take out a new loan with the same bank or with any other bank.

If you have actually managed to do this and have reached a new agreement with your bank, it makes sense that you still try to cut back a little in your everyday life and save money so that you can fall back on your savings in financial bottlenecks. You can save in a wide variety of areas of your life. From getting rid of your own car and switching to public transportation to comparing and switching electricity providers. Here we have an article for you that deals with the topic of “saving”:

Read also:

• Foreclosure explained
• Online portal and local court list
• Foreclosure Submission
• Receivership
• Compulsory mortgage
• Tip! This is how an auction works (external): Compulsory auction procedure

Saving: Advisor and Financial Check

First of all, it is important to have a stable basis. You must always keep an eye on regular and one-off expenses. Our guidebook provides valuable tips and tricks for creating a solid financial basis step by step.

• Saving advisor: Financial Check
• Saving in everyday life (14 tips for investing)

We also have many individual areas where a lot of money can easily be saved. Every week, every month, so that a solid financial basis is getting closer and closer:

• Save subscriptions
• Save Shopping
• Save Driving
• Save free time
• Saving budget
• Save Travel
• Save electricity
• Save relocation

Investing: Investments

With stable financial resources, it is then particularly worthwhile to think about your first investments, so that your money – passively – works for you.

Forced sale quickly explained – procedure, tips & tricks

If you don’t like to read long explanations about the procedure of a foreclosure sale or about the tips and tricks, we have put together some videos for you in which these topics are explained in an understandable and good way.

Read also:

• Foreclosure explained
• Online portal and local court list
• Prevent foreclosure
• Foreclosure Submission
• Receivership
• Compulsory mortgage

If you want to participate in a foreclosure auction as a bidder or you are facing the foreclosure of your own property, the first thing you ask yourself is how such a procedure actually works. The procedure is always the same and firmly regulated. In this video you will learn the exact procedure of a forced sale. Claus Roppel explains the procedure in such a way that it is understandable for every layman. So that it comes at all to the enforcement proceedings must first be given certain enforcement requirements.

The conditions for enforcement

• Title – a document, a court judgment or an enforcement order that determines the claim to be enforced.
• Clause – Official note of enforceability
• Service – the title must have been served on the debtor before or at the time of the commencement of enforcement proceedings

In this video Christian Schmitt explains which things should be considered when participating in a foreclosure auction and he gives helpful tips and ticks.

Bargain hunting at foreclosure sale

If you’re still unsure about whether you should attend a foreclosure auction, you might find this video helpful. Are bargains common at a foreclosure auction, or do you usually pay the going rate, or even more?

This video is about tips that might help you prepare for a foreclosure. It makes sense to watch the event several times before attending a foreclosure auction yourself. You can find the dates of foreclosure auctions either on websites, such as Zvg24 or in the notice boards of the relevant local courts. Most bidders go to a forced sale with the aim of getting a bargain. But to achieve this goal, you should prepare well for the foreclosure auction.

Opportunities & Risks

In this video, you’ll learn more about the opportunities and risks involved in a foreclosure. Here are 4 things you should definitely consider before you participate in a foreclosure auction:

1. Review market value appraisals
2. Examine land records
3. Note the file number of the object to obtain even more information
4. If possible, arrange viewing appointments

Risks of a forced sale – You should be aware of these risks

Of course, there are certain risks involved in a foreclosure. A foreclosure involves risks that you should definitely be aware of. Here we have compiled possible risks for you so that you can prepare yourself for the situation in the event of a foreclosure.

Personal viewing rarely possible

Before participating in a foreclosure auction for a property, it is important to obtain sufficient information beforehand. Unfortunately, it is rarely possible to inspect the interior of a property in advance, as the occupant does not have to allow any insight into the interior. For this reason, possible damages or defects often only appear afterwards.

Existing tenancy must continue to exist – unless own need

If you buy an already rented property at an auction, you automatically become the landlord and have no right to terminate the tenancy, unless you need the property for your own use. You are therefore bound to the tenants to a certain extent.

Bidder offers more than financially possible

At a foreclosure auction, there is always the risk of falling into a so-called “bidding frenzy”. If the desire to buy the property at auction is particularly great, the risk of getting into such a situation increases. The active bidders drive each other up and do not notice it sometime that they have already arrived at the limit fixed by themselves before. Through this happening it can happen that one drives oneself into a financial ruin. Once a foreclosure sale has been concluded, there is no longer any right of withdrawal.

No warranty on construction defects

If you have managed to buy a property at auction and afterwards construction defects occur, this is particularly annoying. The disadvantage of a forced auction is that there is no warranty on construction defects.

After watching these videos, you should know enough about the process, tips and tricks. Still want to learn more about the foreclosure process? Then you can learn more here:

The partial auction for communities of heirs

Objects such as real estate or land often give rise to disputes in communities of heirs. The ideas of how to proceed with the common property are too different and the participants cannot agree. Every heir has the right to demand a partition of the community of heirs at any time and thus to force its dissolution. In such a case, a partition auction may be the last resort to settle the disputes and dissolve the community of heirs. You can find out here what needs to be taken into account in the event of a dispute and a partition auction.

Learn more about communities of heirs!

Application for partition auction – the correct form must be observed

An application procedure always precedes a partition auction. This application can be made by any heir of a community of heirs. Formally, a written application, which must be submitted to the competent district court, is sufficient. However, it must be accompanied by certain documents. In the first application, it must be proven beyond doubt that the applicant has co-ownership of the property to be auctioned. The appropriate document is a corresponding extract from the land register, which must not be older than six months. Once the application has been received, it is examined by the local court and the next steps are initiated.

Partition auction & community of heirs – Video

The procedure – step by step to the partition auction

The process of a partition auction already begins with the application that one of the heirs from a community of heirs must file with the district court. This is followed by further steps in order to carry out the partition auction in accordance with the law.

The expert opinion – assess the value of the property

A partition auction requires an appraisal of the value of the property or land. The court needs this in order to determine the lowest bid for the partition auction. Such an appraisal can be obtained in three different approaches. The petitioner can obtain a private appraisal, but the entire community of heirs must agree to this step. An alternative is to obtain the appraisal through the court. Often a valuation report is already available. As long as this is not older than a few weeks or months, it can also be used.

The minimum bid – determined by the court

The court sets a so-called lowest bid before the partition auction to ensure that the proceeds of the partition auction can cover the costs of the proceedings and all claims of the heirs. Once this is determined, neither the market value nor the purchase price of the property or land is relevant and the lowest bid is considered the notional value. It is made up of the rights, encumbrances and minimum cash amounts. The person who acquires the property or land at the partition auction assumes all rights and encumbrances in addition to the subject matter and thus becomes the purchaser and debtor.

The auction – the highest bid gets the surcharge

Once the lowest bid has been determined by the court, a date for the partition auction can be set. Subsequently, the partition auction of the property or the land should be advertised in newspapers and on the Internet in order to attract interest in the property. Viewing appointments are also possible in consultation with the community of heirs. On the auction date, all interested parties can submit bids within a predetermined time frame. The highest bid is accepted for the property and the community of heirs may be divided.

The duration – varies from case to case

The duration of a partition auction is different depending on the case. It depends in particular on how long it takes to prepare the expert opinion and how long it takes to process the application. The applicant can only shorten the duration by already having a valuation report available when filing the application and the court agrees to its use.

The disbursement – dispute of the community of heirs

The community of heirs does not successfuly dissolve until the proceeds have been successfuly distributed. Disputes can also arise here. If the testator has not determined the distribution in his will, the statutory inheritance quotas usually apply. If the heirs do not agree, a civil action may be brought. The proceeds from the partition auction are deposited with the district court and are not paid out until the heirs have reached a written agreement on the distribution.

The costs – how much are they and who bears them?

Certain costs are incurred for a partition auction. These include the application costs, the procedural costs, the expert’s fees, the lawyer’s fees and the costs for newspaper and internet advertisements. All these costs are incurred when the court orders a partition auction. The costs for the notification of the co-heirs are part of the application costs. Usually, the costs of the proceedings have to be paid as an advance. Who bears the costs of a partition auction depends on the outcome of the auction. If the auction is successful, all costs will be deducted from the proceeds and thus each heir will share equally in the costs. However, if the auction is not successful, the applicant bears the costs alone and the community of heirs continues to exist.

The alternatives – private sale or voluntary auction

The partition auction involves some risks that should be well thought out in advance. The property could be sold below value and lead to low profits for the heirs. There are some alternatives that eliminate these risks. The property can be sold privately, saving the application, procedural and legal fees. In addition, the heirs can choose the buyer themselves and thus ensure that the property is not sold below value.

Another alternative is the voluntary auction. The community of heirs can turn to a public auctioneer who organises and conducts an auction. The advantage here for the heirs is that the minimum bid can be determined themselves and thus there is no risk of an auction below value. However, in both cases the community of heirs must unanimously agree to the sale of the property.

The most important questions on the subject of partition auctions in communities of heirs

A partition auction can resolve disputes within a community of heirs, but it can also reignite disputes. To avoid mistakes and save time, it is important to take the right steps. Lukinski’s experts answer the most important questions on the subject of partition auctions in detail for you.

Why a partition auction?

A partition auction can put an end to long disputes, especially in communities of heirs, and lead to a result with which all heirs agree. The partition auction also offers the last resort if no agreement can be reached.

What does for the purpose of abolishing the community mean?

The partition auction success for the purpose of the abolition of the community around from an indivisible article, like a property or a real estate a divisible money equivalent to generate.

What is a partial auction of a house? More terms in our property glossary.

A partial auction is held when several people are co-owners of a property. The partial auction turns an indivisible object into a divisible amount of money that can be divided among the owners.

What does § 1010 BGB mean?

Pursuant to § 1010 of the Civil Code, the co-owners of a plot of land may make arrangements for the administration or use of a plot of land or exclude the right to demand the dissolution of the community.

What did ZVG mean?

The abbreviation ZVG stands for Zwangsversteigerungsgesetz. This regulates both the forced sale and the forced administration.