Why GDPR is no fine print when it comes to AI tools

The General Data Protection Regulation (GDPR) has, since 2018, regulated EU-wide how personal data may be handled. For a chatbot, that concerns not only name and email address, but any information that can be linked to a person – and that is almost always the case with real estate and tax questions.

• Address or parcel number of a property
• Purchase price or rental income of a specific property
• Names of tenants, buyers or heirs
• Income or asset details for tax questions
• Contact details in uploaded documents

The GDPR requires three things that are hard to verify with many AI services: an adequate level of protection at the place of processing, transparency about what happens to the data, and a clear legal basis for any disclosure to third parties.

Rule of thumb: the question itself is not the problem – the problem is where the answer is computed, and what happens to the input afterward.

Where does the data end up? Server locations at a glance

Depending on which AI is used, data processing is subject to completely different legal systems. For real estate topics, with their inherently personal details, it’s worth taking a close look before uploading sensitive documents.

More on the individual providers and their respective data protection assessment can be found in the detailed articles on Mistral AI and DeepSeek.

Important here: the pure server location is only one building block. Even with an EU server, a US corporation could stand behind it in the background as the parent company, through which US authorities could theoretically still demand access under certain laws. A company with headquarters, legal jurisdiction and data center entirely within the EU – as is the case with Mistral AI or Lukinski AI – most reliably rules out this risk.

What this concretely means for real estate and tax questions

Especially with real estate topics – purchase prices, standard land values, tenancy relationships, tax questions surrounding sale or rental – the details can often be clearly linked to a specific person or property. Anyone who regularly works professionally with an AI should ask themselves three questions before every input.

• Where does this data technically end up?
• Is it stored or resold?
• Does it feed into the training of other models?

Professions with particular risk

• Property management companies with tenant data
• Real estate agents with listing exposé and buyer data
• Tax advisors with client data
• Property developers with project and contract data
• Landlords with private leases

Documents requiring particular caution

• Leases with names and bank details
• Purchase agreements with notary details
• Land register extracts
• Proof of income for financing
• Tax assessments and receipts

The AI Act: the second important EU rule alongside the GDPR

Alongside the GDPR, the EU AI Act has been gradually taking effect since 2024. While the GDPR regulates how personal data is handled, the AI Act regulates how the AI systems themselves may function and be classified. For real estate and tax questions, one classification matters most: AI systems that help decide on creditworthiness or financing approvals are considered so-called high-risk systems and are subject to considerably stricter review obligations than a simple chatbot for general questions.

For most use cases covered in this article – research, summaries, initial orientation on tax questions – these stricter obligations do not apply. However, anyone integrating AI into an automated lending or creditworthiness process should keep the AI Act classification in mind in addition to the GDPR review.

The data processing agreement: why it’s mandatory for business use

As soon as a company – even a small property management company or a single real estate agent – has an AI process third parties’ personal data, the provider’s private use license is not legally sufficient. What’s needed is a so-called data processing agreement (DPA), which precisely regulates what the AI provider may and may not use the data for.

Many free or purely privately oriented AI chatbots don’t offer such an agreement at all, or only for expensive enterprise customers. Anyone who, as a case worker, real estate agent or tax advisor, enters tenant or client data into an AI without a valid DPA is thereby acting in a legal gray area – regardless of how good the AI’s result ends up looking.

Rule of thumb: a good AI result does not undo a missing legal basis – the DPA must be in place before the first input, not checked afterward.

Checklist: how to recognize a GDPR-compliant AI

Not every provider makes its data protection information easy to find. These five points can usually be checked within a few minutes in a provider’s terms of use or privacy policy, before entering sensitive real estate or tax data.

• Server location clearly stated, ideally the EU
• Data processing agreement available for business customers
• Deletion periods for chat histories specified
• No automatic use for model training without consent
• German-language, findable privacy policy

Your rights as a data subject under the GDPR

With providers outside the EU, these rights are considerably harder to enforce in practice, since neither the responsible supervisory authority nor the place of jurisdiction is in Germany. This is one of the main reasons why, for business real estate and tax questions, it’s worth looking at where an AI provider is headquartered.

Our approach: Lukinski AI

This is exactly why we built Lukinski AI so that these questions never remain open in the first place:

• Servers in Germany instead of with a US provider
• No disclosure to third parties – chat histories are not sold or used to train third-party AI
• No tracking, no cookies – history stays local in the browser
• Official data basis – standard land values from genuine sources of the valuation committees
• Payments only via Stripe as the payment service provider, more on this in the privacy policy

Two specialized areas instead of a jack-of-all-trades chatbot

• Real estate: standard land values, rental yield, purchase-related ancillary costs
• Taxes related to property: speculation period, depreciation (AfA), real estate transfer tax

Both areas can be used for free (with a fair message limit); for more intensive use, there is a Pro version with more simultaneous chats and an optional memory feature that only remembers explicitly stated details – never records automatically. It remains important: even a German, GDPR-compliant AI does not replace legally binding tax advice, but provides a well-grounded initial orientation.

Practical examples from everyday life

Example 1: A property management company reviews a lease

A property management company wants to have the utility cost clauses in twenty leases checked at once. With a US chatbot, a third-country review including a DPA would have to be carried out beforehand. With a German AI solution, this step is unnecessary, because the data never leaves its own legal jurisdiction.

Example 2: A real estate agent calculates purchase-related ancillary costs

A real estate agent has the real estate transfer tax, notary and land registry costs calculated for a property in Munich for a client. Since no name is mentioned here, only a purchase price and a federal state, the risk is low – but it’s still a good habit to generally enter as few personal details as possible.

Example 3: A landlord asks about the speculation period

A private landlord asks whether a sale within the ten-year speculation period would be subject to tax. Even without naming a person, a specific individual can often be inferred from the purchase date, address and sale price – a reason to prefer a European AI with a clear data protection situation for such questions.

Example 4: A property developer compares AI providers for internal project documents

A property developer wants an AI to summarize construction descriptions, calculations and floor plans for several projects. Because these documents often also contain buyer and financing data, the company deliberately chooses a provider with an EU server location and a valid data processing agreement, instead of relying solely on the cheapest or fastest chatbot.

Frequently asked questions about AI and GDPR for real estate and tax questions

Am I even allowed to enter private leases into an AI?

Yes, in principle, if the AI used offers an adequate legal basis and adequate data protection. For business use involving third parties’ tenant data, a data processing agreement is additionally required.

Is ChatGPT or Gemini banned for real estate data?

There is no general ban, but users should check whether an additional agreement for business data is in place and whether personal data belonging to third parties should even be entered at all.

What happens if I accidentally entered sensitive data?

Many providers allow deleting individual conversations in the account area. Legally, it’s also advisable to notify the provider via the contact form to request deletion under Article 17 GDPR.

Why is a German AI advantageous for real estate questions?

Because server location, contract law and data protection oversight are all in Germany, the elaborate review of a third-country transfer that would be necessary with US or Chinese providers becomes unnecessary.

For which professions is this topic especially important?

It is especially relevant for property management companies, real estate agents, tax advisors, property developers and landlords who regularly work with third parties’ personal data.

Do I have to inform my clients if I use AI for their real estate data?

Yes. Under the GDPR’s transparency principle, tenants, buyers or clients should generally know when their data is passed on to an AI for processing, for example through an appropriate notice in the lease or in the company’s privacy policy.

A complete comparison of all major AI providers and their respective data protection assessment is available on the overview page AI models compared.

Why your own real estate software instead of classic content?

Most real estate websites consist of two things: listings and guide articles. The problem: listings become outdated, and texts compete with thousands of similar articles. A small, specialized piece of software, on the other hand — such as a purchase price factor calculator or a capital gains tax calculator — solves a specific task and keeps the user on the site longer.

“A single well-placed calculator typically generates 4 to 6 times the amount of organic traffic of a comparable guide article over 24 months — and attracts backlinks from sources that would never link to a pure blog post: tax advisors, law firms, universities.”

The five strategic advantages

The value of a calculator does not lie in the code itself, but in the combination of user engagement, backlink magnetism, and lead quality. Exactly these dimensions make the difference to classic content — and justify the higher initial effort.

• Engagement Time: Tools keep users engaged for 3–8 minutes — texts on average under 90 seconds.
• Backlinks: Calculators are organically linked because they are citable.
• Lead Quality: Someone who runs a cash flow calculation is a potential buyer — not just a random reader.
• Repeat Effect: Users come back for the calculator, not just for a one-time read article.
• Scalability: A well-built plugin can be cloned for 10 additional topics.

Build vs. Buy: What does custom Real Estate software really cost?

The cost issue is the most common stumbling block. Those who used to pay 15,000 € for a custom plugin can now achieve a fraction of that cost with ChatGPT, a WordPress setup, and a few hours of time. The key is choosing the right path among four options — and having a realistic view of ongoing maintenance costs, which are consistently underestimated in every calculation.

Four Paths to Your Own Real Estate Software

The following overview shows the typical cost ranges, implementation durations, and SEO values of the four most common implementation options — from a standard solution in the marketplace to a custom agency development.

For a single computer — for example, to calculate gross yield or calculate net yield — self-building is almost always worthwhile. For more complex systems (CRM, portal integration, multi-stage evaluation logic according to income value method), a freelancer or agency remains sensible.

Hidden costs — what the maintenance fee really covers

The “100–300 € per year” figure is not arbitrary. It covers specific costs that every tool provider eventually pays — either with money or with their own labor. Whoever ignores this will have a dead plugin in the backend after 18 months.

• WordPress-Core-Updates: Major releases occasionally break the Shortcode API — 1–2 hours of adjustment per year.
• PHP version jumps: Hosting providers enforce PHP 8.x → 8.y every 2–3 years, deprecated functions must be replaced.
• Formula updates due to legal changes: Land transfer tax rates, inheritance tax exemptions, depreciation rates change.
• Security patches: Mandatory for input forms — regularly check for XSS and SQL injection vectors.
• Browser compatibility: Chrome/Safari updates change CSS behavior (Flexbox quirks, input styling).

Step-by-step: Building a WordPress plugin with ChatGPT

Which ChatGPT model suits which task is explained on the linked in-depth page — for the following code examples, the mid-tier model is usually more than sufficient. The process is straightforward — provided you structure the queries to ChatGPT correctly. Those who prompt without a plan get code deserts in return. Those who think in clear modules have a working plugin within an afternoon. The following workflow has been proven on over 30 productive computers.

Phase 1: Concept and Data Model

Before a single line of code is written, it must be clear: What input fields does the calculator need? What formula is used? What output should the user see?

• Define input: Purchase price, rental income, calculate purchase-related costs, Equity.
• Determine formula: e.g. Gross yield = (Annual net cold rent / purchase price) × 100.
• Plan output: Number, traffic light rating, comparison to market average.
• Consider edge cases: What happens with zero inputs or negative values?

Phase 2: Code Generation with ChatGPT — concrete example

Now ChatGPT comes into play. The key trick: don’t prompt “Write me a plugin,” but module by module. First, shortcode registration, then HTML form, then calculation function, then CSS. Test each module individually. This is what a productive prompt for module 1 looks like:

Prompt example: “Write me the PHP code for a WordPress plugin with the shortcode”[bruttorendite_rechner]. Three input fields: Purchase price (Euro), Annual net cold rent (Euro), Purchase additional costs in percent (Default 12). Formula: Gross yield = (Annual rent / (Purchase price × (1 + additional costs/100))) × 100. Output as rounded number with two decimal places plus traffic light rating: red below 3 %, yellow 3–4.5 %, green above 4.5 %. With validation against empty and negative inputs. Code WordPress-compliant, escaping with esc_attr() and esc_html(). Plugin header included.”

From this single prompt arises a functional skeleton of 60–90 lines. Modules 2–4 (CSS styling, AJAX refresh without reload, FAQ block integration) follow the same pattern. Important: Test locally after each module before prompting the next one — otherwise, follow-up errors occur that ChatGPT overlooks in larger code blocks.

Phase 3: SEO optimization of the tool

A calculator without an SEO framework won’t rank. Therefore, it should include: H1 with keyword, 500–800 words of explanatory text, FAQ, internal linking to related calculators such as Calculate Required Equity, Calculate Notary Fees, or Rental Yield. Enhance with Schema.org markup as `HowTo` or `FAQPage` — this brings rich snippets into the SERP.

Phase 4: Tooling and Test Stack

Anyone building professionally needs a small stack. Practical recommendation: ChatGPT Plus for code quality, local WordPress environment, version control, and a code editor with PHP linting.

• ChatGPT Plus or API: Free version is sufficient for hobby use, but for productivity, Plus or API access with current models is recommended.
• Local Test Environment: Local by Flywheel (Mac/Win) or XAMPP — avoids live crashes.
• Code Editor: VS Code with PHP Intelephense — catches syntax errors before upload.
• Version Control: Git repository (even private) — commit each ChatGPT iteration cleanly.
• Plugin Boilerplate: WPPB.io as a starter template, saves 2–3 hours of setup.

Link building with your own tools: The “Investment” strategy

This is where the real leverage lies. As described in the guide to the market situation when buying real estate, reach is increasingly shifting towards tools and data. Whoever builds a calculator for a niche topic — such as calculating prepayment penalties or calculating the speculation period — becomes the first point of contact for tax advisors, law firm blogs, and comparison portals.

The backlink mechanics in detail

Backlinks don’t happen by chance — they follow clear patterns. Tax or legally relevant calculators are especially frequently linked because they simplify client clarification and save advisors time. Exactly these sources are worth their weight in gold from an SEO perspective.

• Tax advisor blogs: link calculators for complex topics like Inheritance tax calculator according to § 13 ff. ErbStG.
• Law firms: use external tools for client clarification.
• Forums and Reddit: calculators are shared in discussions, texts are rarely linked.
• Comparison portals: list calculator providers — often with a Do-Follow link.
• Universities/colleges: lecturers link practical tools in scripts.

Outreach template that works

“Build a tool and wait” doesn’t work. The first 10–20 backlinks must be actively acquired. The following email template has achieved response rates between 12 and 18 % in its own outreach campaigns — five times higher than generic link requests.

Subject: Free calculator for your contribution to[Thema X]

Dear[Name],

in your

]]> https://lukinski.com/lukinski-rating-germany-reviews-cities-list/ Fri, 22 Mar 2024 12:49:06 +0000 https://lukinski.de/lukinski-rating-germany-investment-property-city-list/ The Lukinski Rating Germany ranks almost 700 cities according to their investment potential — from A+ Hidden Champions to D Risk Champions. Those looking for real estate as an investment face the fundamental question: Should I go for net yield or long-term value appreciation? The answer depends directly on the location — and that’s exactly what this rating is for. In this guide, we show you how to read the ratings, which cities typically fall into which class, which key figures you can use to categorize each city, and how to avoid typical beginner mistakes when choosing the location for your first property.

What the Lukinski Rating evaluates — and what it doesn’t

The rating bundles structural location factors into a single grade: population development, economic strength, infrastructure, labor market, and rental price dynamics. Two time periods are considered in parallel — the last ten years as a short-term trend and the last 30 years as a long-term foundation. This results in a grade that filters out short-term hype and highlights genuine structural strength.

The Five Core Factors in Detail

• Population development: Growth or shrinkage of the population, including age structure and migration balance
• Economic strength: GDP per capita, unemployment rate, tax revenue, major employers
• Infrastructure: Transport connections, education, healthcare, digitalization
• Rental price dynamics: Development of cold rent per m² over ten and 30 years, comparable to the rent index
• Price level: Ratio €/m² compared to the national average, balanced with the standard land value

What the Rating deliberately omits

Microlocations within a city, individual property quality, or the personal real estate financing are not part of the rating. An A+ city does not protect you from a poor property in a bad street — and in a C city, the right apartment building can perform significantly better than the city average. The rating is therefore a preliminary selection, not a free pass.

City Rating vs. Neighborhood Rating: The Decisive Additional Filter

Berlin is rated as an A location — yet Mitte, Prenzlauer Berg, and Charlottenburg are effectively A+, while Marzahn-Hellersdorf, Hellersdorf, and parts of Spandau are more appropriately rated as C. The same applies to Hamburg (Eppendorf vs. Billstedt), Frankfurt (Westend vs. Griesheim), or Leipzig (Südvorstadt vs. Grünau). Anyone who only uses the city rating may end up buying a D property at A+ prices.

• Rule of thumb: Within an A city, neighborhoods can differ by up to two rating classes
• Indicators of Neighborhood Quality: Purchasing Power Index, Social Welfare Rate, Average School Grades, Vacancy Rate
• Practice: City Rating for Preliminary Selection, Neighborhood Research for Property Decision

The Rating Scale in Direct Comparison: Return vs. Appreciation

Each rating class follows its own investment logic. A locations are appreciation investments with low ongoing return, C and D locations are cash flow investments with higher risk. The following table shows typical key figures per class — gross yields, purchase price factors and realistic €/m² ranges.

Rating	Gross Yield	Purchase Price Factor	€/m² (Existing)	Strategy
A+ / A	2.5 – 3.5 %	28 – 40	5,500 – 12,000 €	Value appreciation, inflation protection
A-	3.5 – 4.5 %	22 – 28	3,800 – 6,500 €	Mixed strategy
B+ / B	4.0 – 5.5 %	18 – 25	2,500 – 4,500 €	Cash flow + moderate value appreciation
B-	5.0 – 6.5 %	15 – 20	1,800 – 3,200 €	Pure cash flow
C+ / C / C-	6.0 – 8.5 %	12 – 17	900 – 2,000 €	High yield, vacancy risk
D / D-	8.0 – 12 %+	8 – 13	400 – 1,200 €	Speculative, only with experience

The simplest rule in location investment: The higher the gross yield, the lower the value appreciation — and vice versa. Those looking for both at the same time buy in the B+ segment.

City List: Example Assignment by Rating Class

The following overview shows typical example cities per class. Important: The exact classification can shift due to demographic and economic developments — the list serves as a guide, not as a binding recommendation. A complete database of all nearly 700 cities can be found in the main directory of the rating.

Klasse	Typical example cities	Charakteristik
A+	Munich, Hamburg, Frankfurt, Stuttgart, Dusseldorf	Top 7 Metropolises, high liquidity, high price level
A	Berlin, Cologne, Heidelberg, Freiburg, Wiesbaden	Cities with strong demand, moderate return pressure
A-	Münster, Bonn, Mainz, Karlsruhe, Regensburg, Ingolstadt	University or corporate cities, stable Sweet Spot
B+	Leipzig, Dresden, Nuremberg, Augsburg, Mannheim, Erlangen	Emerging metropolitan areas, best risk-return ratio
B / B-	Hannover, Bremen, Bielefeld, Erfurt, Kiel, Aachen	Solid medium-sized cities, good cash flow profiles
C	Wuppertal, Gelsenkirchen, Magdeburg, Halle, Chemnitz	Strukturwandelregionen, hohe Brutto-Rendite, demografisches Risiko
D	Salzgitter, Pirmasens, Görlitz, Suhl, Hoyerswerda	Shrinking cities, speculative profile, niche strategy

Note: The assignments are illustrative. Within each class there are ranges, and some cities are in transition — see the section “Class Transitions” below.

A+ Hidden Champions: Value Appreciation Instead of Cashflow

Munich, Hamburg, Frankfurt, Stuttgart, Dusseldorf — the A+ locations are considered the safest investments, but are often a trap for beginners. A purchase price factor of 35 means: The gross yield is only about 2.9%. After repayment, interest and reserve for maintenance, the ongoing cash flow is often negative — you pay every month.

When A+ Still Makes Sense

• High Equity Ratio: At least 40 % Equity, so that the cash flow does not turn negative
• Inflation Protection: For those who want to protect wealth from inflation, not actively build it up
• Succession planning: Long holding period, later use inheritance tax strategies
• Liquidity: Resale in A+ locations is also possible in crises
• Rent security: High creditworthiness of tenants, low rent default rate

Typical trap — precisely calculated

A buyer finances a 65 m² apartment in Munich at 6,150 €/m² (purchase price 400,000 €) with 80,000 € equity. With 18 €/m² cold rent (1,170 € monthly rent, 14,040 € annually) and an annuity of about 18,500 € annually (3.8 % interest, 2 % amortization on 320,000 €) a running loss of about 4,500 € per year is generated — before property management fees, non-reimbursable shares and rent default buffer are taken into account. After all additional costs, a negative cash flow of 6,000 to 8,000 € annually remains realistic. The appreciation must more than offset this loss over the entire holding period — this has historically worked in Munich, but is not a natural law.

Quiet risks in A+ locations

• Rent control + rent cap discussion: political risks stronger than in B/C
• High service charges: often 4 – 5 €/m² in premium locations, of which 1.50 – 2 €/m² not recoverable
• Renovation pressure: old buildings with high energy inefficiency
• Value correction risk: after interest rate hike, strongest price declines in top locations

The B+ gap: The best risk-return ratio

The insider area of the rating are the B+ and A- locations: Leipzig, Dresden, Nuremberg, Münster, Karlsruhe, Mannheim, Bonn, Augsburg, Erlangen. Here you will find purchase price factors between 20 and 25 with stable rental demand and realistic value increases of 2 – 4 % per year. The ratio of current return and asset growth is structurally best in this class.

Why B+ is the sweet spot for many investors

• Rent control often more moderate than in top 7 metropolitan areas
• Less competition from institutional investors
• Purchase ancillary costs: 9 – 12 % depending on the federal state — calculate in advance with the purchase ancillary costs calculator
• Student cities with stable rental demand across economic cycles
• Appreciation reserve through catch-up effect compared to A-cities
• Large employer anchors: Siemens (Erlangen), BMW (Regensburg), SAP (Walldorf-Mannheim) structurally stabilize rental demand

Example calculation B+ location Leipzig

An 75 m²-Apartment in Leipzig for 220.000 € (≈ 2.930 €/m²) with 9 €/m² cold rent (8.100 € annually) results in a gross return of approximately 3.7 % with a factor of about 27. With a high-quality location at 11 €/m², the return increases to 4.5 %. With 25 % Equity (55.000 €) and 3.8 % interest, the cash flow is neutral to slightly positive depending on the amortization rate. Important: The rental level in Leipzig has more than doubled in 15 years — the actual leverage lies in the rent increase over the holding period. Compare your values with the local rent return before you invest.

Anker-Factor: What structurally stabilizes a B+ city

• University with 20.000+ students: dau
  ]]> https://lukinski.com/real-estate-statistics-house-apartment-investment-demographics-and-square-meter-price/ Fri, 02 Feb 2024 05:00:00 +0000 https://lukinski.de/real-estate-statistics-house-apartment-investment-real-estate-prices-in-germany/ Statistics and studies are important tools for Real Estate Investors & investors, not only for assessing square meter prices and property prices, but also the demographic development (Tip: Investment Microapartment) of districts, new construction, building permits, all of which ultimately influence your investment decisions. For property buyers, but also for property sellers, the “right” time for the transaction is important in order to achieve the highest possible profit or the highest possible return! A look at the numbers and facts in Germany. An overall overview is provided by our page on the German Real Estate Market.

  : Statistics on real estate, housing and investment

  How is the general economic situation of people developing? When is buying or selling worthwhile? What current studies are available? We have made it our mission to collect the most important results from the Federal Statistical Office for you.

  Tip! Classic or exotic: Which property is suitable as an investment? The interview: Real estate as an investment (Part 1) + my Investment Atlas for Germany

  House Price Index in Germany

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  Current Inflation in Germany

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  Attractiveness for Real Estate Investments

  The shares of real estate companies in Germany give an impression, as does the Federal Statistical Office. Let’s start with the most important question:

  How do you assess Germany’s attractiveness as a location for real estate investments in the year?

  

  More statistics can be found at Statista

  Germany’s Position in the European Comparison

  How would you assess Germany’s attractiveness as a location for real estate investments in 2019 in comparison to other European countries?

  

  
  

  2023: The Real Estate Price Drop -6.8%

  The latest figures from the Federal Statistical Office:

  “The average price of residential real estate fell by 6.8% in the first quarter of 2023 compared to the same quarter of the previous year. According to the Federal Statistical Office (Destatis), this was the largest decline in residential property prices compared to a previous quarter since the start of the time series in 2000.”

  This applies not only to existing properties, but the sentiment is also reflected in new construction.

  Completion of residential units in residential and non-residential buildings

  Here you can see the official evaluation of: “Completion of residential units in residential and non-residential buildings* in Germany (in thousands)”. The latest figures are still from 2022. In the first half of 2023, construction permits were granted for 135,200 residential units in Germany, whereas 200,000 would have been needed to achieve the planned target of 400,000 new buildings for the year.

  • Target 2022: 400,000 newly built residential units
  • Achieved: 292,000

  

  Residential construction stagnates: Number of approved housing units

  How has the number of approved housing units in residential and non-residential buildings in Germany developed? The number of new approvals is decreasing, as well as the actual newly built units.

  – 27.1 % in 20 years

  Number of approved housing units in residential and non-residential buildings in Germany from 1995 to 2017.

  • 2022: 331,300
  • 2018: 346,810
  • 2013: 270,34
  • 2008: 174,691
  • 2003: 296,823
  • 1998: 475,711

  

  Tip! Interesting statistics

  Further studies and statistics can be found on the websites of the Federal Statistical Office. Read more about:

  • Heirs and inheritance statistics
  • Money investment statistics
  • For new construction: Weather statistics

  2019: Stable growth

  Income thresholds for classifying individuals and couples as poor or rich

  Here you can see the official analysis of: “Income thresholds for classifying individuals and couples as poor or rich based on monthly net income”.

  • Poor (1 person): 781 euro
  • Normal (1 person): 1.301 euro
  • Wealthy (1 person): 3.418 euro
  • Poor (couple): 1.171 euro
  • Normal (couple): 1.952 euro
  • Wealthy (couple): 5.127 euro

  

  More statistics can be found at Statista

  Disposable income per employee

  Disposable income per employee in Germany from 1960 to 2018. Here you can see the average disposable income per employee in the last 5 years in Germany:

  • 2018: 22,792 Euro
  • 2017: 22,124 Euro
  • 2016: 21,636 Euro
  • 2015: 21,098 Euro
  • 2014: 20,577 Euro

  Unemployment rate on an annual average

  Unemployment rate in Germany on an annual average from 2004 to 2019. Here you can see the official evaluation of the unemployment rate in the last 5 years in Germany:

  • 2019: 5.3 percent
  • 2018: 5.2 percent
  • 2017: 5.7 percent
  • 2016: 6.1 percent
  • 2015: 6.4 percent

  

  Average unemployment number

  Average unemployment number in Germany from 2004 to 2019. Here you can see the average unemployment number in Germany over the last 5 years:

  • 2019: 2.39 million
  • 2018: 2.34 million
  • 2017: 2.53 million
  • 2016: 2.69 million
  • 2015: 2.79 million

  

  2018: Rent Boom

  Square meter price for condominium – Top 10

  Here you see the cities with the highest square meter prices for condominiums in comparison of the years 2010 and 2018* (in euros per square meter).

  1. Munich (Bavaria) with 8,342 euros per square meter; from 6,737 euros per sqm in 2014; increase of 1,695 euros per sqm in 4 years
  2. Stuttgart (Baden-Württemberg) with 5.925 Euro per square meter; from 4.744 Euro per sqm² in 2014; increase of 1.181 Euro per sqm²
  3. Frankfurt am Main (Hessen) with 6.060 Euro per square meter; from 4.373 Euro per sqm² in 2014; increase of 1.687 Euro per sqm²
  4. Freiburg im Breisgau (Bayern) with 4.943 Euro per square meter; from 4.740 Euro per sqm² in 2014; increase of 203 Euro per sqm²
  5. Ingolstadt (Bayern) with 4.969 Euro per square meter; from 4.287 Euro per sqm² in 2014; increase of 682 Euro per sqm²

  

  More statistics can be found at Statista

  Cities with the highest rental prices for apartments

  Here you can see the 10 cities with the highest rental prices in the 4th quarter of the house valuation and the common methods can be found here. Year 2018:

  1. Munich: 17.56 Euro/m²
  2. Frankfurt am Main: 13.96 Euro/m²
  3. Stuttgart: 13.64 Euro/m²
  4. Berlin: 12, 29 Euro/m²
  5. Darmstadt: 12.23 Euro/m²
  6. Mainz: 12.17 Euro/m²
  7. Freiburg: 12.13 Euro/m²
  8. Wiesbaden: 12.03 Euro/m²
  9. Hamburg: 11.94 Euro/m²

  

  2017: New Construction Volume

  More on the topic:

  • New Construction: Single-family home, building land, financing and costs
  • Developer: Realizing new construction

  Approval volume for new residential and non-residential buildings

  

  2016: Comparison of Federal States

  Number of newly built residential buildings by federal state

  Here you can see the number of newly built residential buildings by federal state:

  • Bavaria: 21,600
  • North Rhine-Westphalia: 17,400
  • Lower Saxony: 15,400
  • Baden-Württemberg: 14,500
  • Schleswig-Holstein: 6,800
  • Hesse: 6,400
  • Brandenburg: 6,200
  • Rhine-Palatinate: 5,900
  • Saxony: 4,300
  • Mecklenburg-West Pomerania: 2,400
  • Berlin: 2,200
  • Saxony-Anhalt: 2,100
  • Thuringia: 2,000
  • Hamburg: 1,400
  • Saarland: 900
  • Bremen: 500

  

  Development of house prices

  Development of house prices in Germany from 2000 to 2017 (2015 = index 100).

  

  Development of the rental price index

  Development of the rental price index for Germany from 1995 to 2017 (2010 = index 100)

  

  Other

  Development of local rental prices

  How have local rental prices developed in your region in recent years?

  

  Controversy: Google Street View

  Would it bother you if your house were visible up close in Google Street View on the internet or is that not the case?

  

  Condominium Ownership

  How high is the homeownership rate in the individual federal states? Here are the “most recent” figures from the federal statistical office. Since 2014, there has been no new survey. As soon as new data becomes available, we will include it here! Here you can see the homeownership rate in Germany between 1998 and 2014 by federal state.

  © Statista 2019 – Source: Federal Statistical Office

  	1998	2002	2006	2010	2014
  Saarland	58.1%	56.9%	54.9%	63.7%	62.6%
  Rhine-Westphalia	55%	55.7%	54.3%	58%	57.6%
  Lower Saxony	48.9%	51%	49%	54.5%	54.7%
  Schleswig-Holstein	46.8%	49.4%	47.1%	49.7%	51.5%
  Baden-Württemberg	48.3%	49.3%	49.1%	52.8%	51.3%
  Bavaria	47.6%	48.9%	46.4%	51%	50.6%
  Hesse	43.3%	44.7%	44.3%	47.3%	46.7%
  Brandenburg	35.5%	39.8%	39.6%	46.2%	46.4%
  Germany overall	40.9%	42.6%	41.6%	45.7%	45.5%
  Thuringia	39.2%	41.8%	40.6%	45.5%	43.8%
  North Rhine-Westphalia	37.4%	39%	38.7%	43%	42.8%
  Saxony-Anhalt	36.5%	39.6%	37.9%	42.7%	42.4%
  Mecklenburg-West Pomerania	32.2%	35.9%	33.2%	37%	38.9%
  Bremen	37.5%	35.1%	35.4%	37.2%	38.8%
  Saxony	28.7%	31%	29.5%	33.7%	34.1%
  Hamburg	20.3%	21.9%	20.2%	22.6%	22.6%
  Berlin	11%	12.7%	14.1%	14.9%	14.2%

  Sell hotel – Tourism and guest numbers

  Munich, Berlin, Frankfurt and nationwide: Tourism in Germany is booming and has been shining with new record numbers for over 10 years. Accordingly, the number of overnight guests is naturally increasing, as is the demand for hotels in the real estate market. From the stylish, luxurious boutique hotel in the city center to hotels with attached gastronomy and event areas. In Germany, people are not only taking more vacations, but also spending more money on them. As a result, prices for overnight stays are rising, and the hotel industry is becoming a lucrative business for more and more companies and entrepreneurs.

  Therefore: The real estate market and the tourism market are both currently on the rise. If you sell now, you will achieve a good selling price – why wait for the next real estate bubble?

  Overnight stays in German accommodation establishments from 1992 to 2018 (in millions).

  

  Help and Definition

  The most important forms of representation and terms at a glance:

  Why are the studies so selective?

  The Federal Statistical Office only offers a part of the information for free use. A large portion of the statistics that have been prepared for use are only available with a Premium account. This Premium account at the Federal Statistical Office costs 49 € per month.

  What is a bar chart?

  Bar charts are the most common form of statistical results used by the Federal Statistical Office. In a bar chart, different values are displayed on a scale. The scale extends along one axis and contains a value, such as the number of inhabitants or the average income. The other axis then carries the different types or classes, for example, different age groups or the subdivision into different districts.

  What is a pie chart?

  The pie chart format is used relatively rarely by the Federal Statistical Office. A pie chart displays statistical values in a 100% distribution. A pie, meaning a circle, represents 100%. When entering individual values, a straight line is drawn from the edge to the center, creating small triangles, one side slightly rounded. This creates the optical effect of a pie slice. That is why this form of presenting statistical values is also called a pie chart.

  What does the Federal Statistical Office do?

  As an authority, the Federal Statistical Office is responsible for collecting general, relevant data. This data is used, among other things, by various ministries, as well as by associations, private individuals, and naturally also by students and students. The Federal Statistical Office is based in Berlin, but is also represented by various offices throughout the country.

  Are the statistical data representative?

  Yes, the surveys conducted by the Federal Statistical Office are mostly representative surveys or results from extrapolations. The data are therefore interesting for many population groups, from the real estate agent who wants to observe the demographic development of a particular area to students preparing for a presentation or a major research paper. Thus, the Federal Statistical Office fulfills a major and important task in Germany.

  Further studies and statistics can be found on the internet pages of the Federal Statistical Office. Read more about:

  • Heirs and Inheritance
  • Saving money / Investment
  • Weather in Germany
  ]]> https://lukinski.com/how-to-buy-rental-property-becoming-landlord-investment-purchase-tips/ Tue, 30 Mar 2021 11:43:21 +0000 https://lukinski.de/?p=38918 USA – So you want to become a landlord? You want to buy a rental property in the form of a house or apartment? There’s a lot to plan, from finances, to tenants, taxes, and more. Whether you want passive income, or to make it your primary point for cash flow is up to you. With many investment strategies and possibilities, we take you through the best tips and tricks, along with simple, easy-to-understand explanations of all the most important terms and concepts. Advantages, disadvantages of such investments, what to look out for, and which way best to finance everything.

  Buying Real Estate Rental Property – Best Investment Strategies

  More and more people are choosing to buy rental property as a lucrative way of receiving passive income, with many opportunities for further investments, massive profits, and a life of luxury and opulence. There is much to consider and research before you make any investment in rental property, but you’re likely going to be quickly looking at cash flow and a realtor lifestyle you could only have dreamed of.

  

  Is Buying a House to Rent a Good Investment? Advantages Disadvantages of Rental Property

  There is not one clear answer to whether buying rental property is a good investment. It depends on many factors such as location, the behavior of the market, the tenants, unexpected costs, etc. Therefore it is impossible to say whether it is a good investment for you until you inform yourself as best as you can, and make an educated decision.

  Advantages of Rental Property Investments – Tax Deductions, Financial Security

  Being a landlord often sounds like a dream job. Essentially you’re being paid because people are living somewhere. It is the most famous and infamous source of passive income. This is perhaps its biggest advantage. In terms of how much work you have to put in per dollar earned, it can be extremely lucrative. Another advantage is that the real estate market tends to be quite stable, which means that the majority of properties (bought in good areas) increase in value. That means, while you’re making a passive income, one day the mortgage will be paid, and despite having made money off of your investment, you can sell it at a higher price than you bought it!

  

  Rental Property Taxes – What Taxes do Landlords Pay?

  For one, rental income is not subject to social security taxes. The social security tax rate is currently 12,4% split by employer and employee, meaning that when owning rental property you are paying 6,2% less taxes.

  Disadvantages of Rental Property Investment – Difficult Tenants

  The biggest downside is dealing with difficult tenants. These can be those that are harmful for the atmosphere (e.g. by being loud), those that damage property (high repair costs), and those that do not pay their rent on time. Another downside is also that you are legally bound quite heavily, as renters are strongly protected by the law. That means that difficulties can arise, and cause a lot of stress. Of course it’s important to decide in what real estate to invest, because if you buy a house, these issues tend to be less serious.

  • Damaging Tenants
  • Tenants who do not Pay Rent

  

  What does a Landlord Do? Tasks, Responsibilities when Owning Rental Property

  In short, a landlord is in charge of general upkeep. That means repairs in the house such as plumbing or electricity which the landlord has to fix. Other things include maintaining the more general facilites. For example, if you own rental property you have to make sure common areas are cleaned, the doors, elevator, etc. all work, and more. Then comes the problem of rent. Some tenants can be quite a hassle when they don’t pay rent on time, in which case you have to contact them and collect the rent yourself.

  • Repairs in home
  • Maintenance of Property
  • Collecting Rent

  Financial Planning for Becoming a Landlord

  That means paying off all debts, making sure you have enough saved up for a downpayment, and securing your finances for the long-term future. It is also probably a good idea to secure a separate business account.

  • Save enough for a Downpayment
  • Job Security

  

  Six Steps to Purchasing Rental Property – Buy House, Apartment

  The five steps to owning rental property begins with your finances. Next, research and strategy. Where do you want to invest, how is the market in that area, what type of real estate you want to invest in, the general turn of the economy and much more! Now your strategy with short-term vs long-term rentals, buying a house or apartment, etc. Step 4 is finding the property you want to purchase. Step 5 means buying the property (and getting a good deal!). And lastly, perhaps most difficult, find tenants!

  1. Order your Finances
  2. Research
  3. Strategy and Investment Planning
  4. Find the Property
  5. Purchase Property
  6. Find Tenants

  

  Step 1: Order your Finances – Landlord Bank Account, Savings

  The most important thing before buying a house or buying an apartment is to get your finances in order. That means having paid off all debts, or nearly all, having a good credit score (otherwise get ready for mortgage insurance). Then, you will want to open a separate account. This can of course be done by registering a real estate LLC in which case you would buy the property over the company. Otherwise you will have to open a new account.

  Step 2: Research – Where to Buy, When to Buy Rental Property

  This is an important step, as you will need to get a lay of the land of where you want to invest and how. There is no universal manual because, e.g. if you buy a house in New York, it’s different than if you buy an apartment and then even more different if you buy an apartment in L.A. It’s also critical to know about the more specific location, there are always up-and-coming neighborhoods in every city. The top USA real estate neighborhoods are spread out all over, and you could be living near one without knowing! We’ve tracked down the best locations for the biggest players in American real estate:

  • Top Neighborhoods: New York
  • Top Neighborhoods: Los Angeles
  • Top Neighborhoods: San Francisco
  • Top Neighborhoods: Miami
  • Top Neighborhoods: Las Vegas

  

  Step 3: Strategy, Investment Planning – ROI, Value

  The typical question for real estate and rental property investment is the ROI. ROI means return on investment, which is typically expressed in a percentage. It just tells you how much money you make in proportion to how much money you spend. You should know that, unlike stocks, or REITs, rental property will not be valuable or a good investment because it is constantly rising in value. Rather it is an additional income on the side, apart from your normal investments.

  • ROI = Return on Investment
  • Real estate is about cash flow

  

  Step 4: Find the Property – House Hunting, Realtors

  Next step is to find property, this can turn out to be quite difficult or quite easy depending on the region. Typically this is also the point where you will decide whether you choose a fixer-upper or a ready house. For experienced investors this is a normal thought, but if you are just starting out, a fixer-upper can be extremely risky and bankrupt you. Unless of course you want to get into flipping houses.

  • Fix-Up or ready house?

  Step 5: Purchase Property – Mortgage, Cash, Downpayment

  Of course with a cash purchase you can circumvent a lot of the additional real estate purchase costs, but not all (think mortgage tax and transfer tax, and moving expenses). Still, as soon as you purchase with a mortgage you will be paying more in the form of mortgage interest. There are different opinions on the specifics, but it is always important that even if you are absolutely in love with a house, to let cooler heads prevail. There are many reasons to buy a house for rental property, but these are all related to finances and strategy.

  • Real Estate Closing Costs
  • Logic should decide whether you buy

  

  To learn more about what happens when you get to the point of actually buying a house, you can take a look at our article on all the taxes you will pay when you buy a property or real estate.

  Real Estate Purchase: All Taxes

  Step 6: Find Tenants – Advertising, Location

  This is the point that it can get very very frustrating, or very comfortable. If you’re living in a place like L.A., this can be quite easy with very high demand making a good tenant easy to find. In other places you may have to wait for the right one. Important though, if you get the feeling that the fit isn’t right, don’t sign a contract! It is near impossible to force a tenant out legally, and one more month without the extra income won’t make the difference.

  • Don’t rush the search
  • Easier in bigger cities, with higher demand

  

  Top 5 Tips for Buying Rental Property! LLC, Saving Taxes

  There are many things to be aware of, and things to take into account for buying rental property for real estate investment. It’s important that you research a lot so as to make a smart decision. Still, there are a few secret tips that are very important to ensure quick profit from rental property!

  1. Do the Math!
  2. Landlord Insurance
  3. Found a Company
  4. Buy or Finance?
  5. Go out of State

  

  Do the Math! Research, Calculation of Costs for Rentals

  This is critical. Of course, before investing in rental property the most important thing is extensive and intensive research. This does not only consist of informing yourself about e.g. mortgage or mortgage interest, and a downpayment. The main question is: for each dollar that you invest in this real estate rental investment, how much will you get back. Factor in the time, and then compare to your finances. It is possible that your investment strategy only offers returns after two years. Can you hold out that long?

  For each dollar you invest, how much will you gain? When is your investment profitable?

  

  Get Landlord Insurance! Recover Lost Rental Income, Liability Protection

  There are going to be accidents, unwanted injuries and more on your property. You need to protect yourself from this. One possibility is with a limited liability company or the similar s corporation (see below), but this is not going to protect you legally, rather than just make sure that a legal action does not bankrupt you. So you have to get landlord insurance! A landlord insurance covers lost rental income (great for the rare difficult tenant), damage to the property, and of course, as mentioned liability protection against injuries or worse on your property. Remember, itemizing insurance costs is one of the top methods of real estate tax deductions!

  • Protection against lost rental income
  • Damage to property
  • Liability for injuries on property

  Found a Company – LLC, S Corp or C Corp

  As mentioned above, it’s important to protect yourself from possible liabilities. Even with landlord insurance, you should likely put in the effort and cost to found a real estate entity which owns the buildings in your place. The main examples are the LLC, S corporation, C corporation, and Limited Partnership. These all differ in the degree to which they protect you from liability, but also to the degree in which they prevent double taxation, a common problem with other real estate investment entities.

  • LLC
  • S Corp
  • C Corp
  • Limited Partnership

  

  Buy or Finance? Mortgage or Cash for Rental Investments

  You will hear many voices insuring you that the only smart choice for buying a rental property is to finance it, in other words to buy it using a mortgage. This is true in most cases, but if you have the money available, buying cash can be even better. No mortgage interest, no uncertainty, and you profit right away. Of course you’ll be a few thousand dollars lighter, bt this comes in with rental income over time. It’s also seemingly forgotten at times that a house purchased with a mortgage still requires a substantial downpayment, as well as significant additional costs buying real estate, which means even with a mortgage, where, e.g. a 20-year plan can hound you for years, you have some saving to do before starting to invest and reap profits.

  • Buy with mortgage
  • Consider alternative cash options

  

  Go out-of-state! Rental Investments Far away – Is it Profitable?

  Many first-time investors make the decision to buy close to home. They hear a great offer for a house nearby in an up-and-coming neighborhood and choose to buy because it’s just a few minutes drive away. It’s true of course that this has its advantages; if a renter has an issue or a repair, you can come by quickly and fix it, you can give personal house tours with no problems, etc. At the same time, it’s a calculation game. There are extremely profitable neighborhoods in many parts of the country. Buying a rental there can give you much larger profits in much shorter time. These profits would offer the possibility of a property manager, reduces your involvement and makes the now-larger income even more passive.

  • Advantages to buying nearby
  • Far away can be much more profitable

  

  Gross Rental Income – Top Tip for Saving Taxes

  Easily explained: rental income is taxed as your normal income would be taxed. That means you add it to your salary as you would a normal job. Rental income can include the following types of payments: Advance payments of rent, non-returned deposits, services provided in exchange of rental income. Now we know what the income consists of, but the question is how can you pay less of it?

  

  What can be Deducted from Rental Income? Itemizing Tips

  You can deduct more than you think from your rental income. That includes things like the mortgage interest of your property, the insurance costs and property taxes. Along with these it is also typically possible to deduct fees such as those for advertising your properties, and those for legal assistance and for the Homeowner’s Association.

  • Depreciation
  • Property Manager Payments
  • Mortgage Interest
  • Insurance Costs
  • Property Taxes
  • Advertisement Fees
  • HOA / Condo Fees
  • Legal and Professional Fees

  

  There’s so many more tax deductions you can use when you own real estate, whether as residence or as a landlord!

  Real Estate Tax Deductions

  Best Gross Rental Income Deduction! Depreciation

  The most important concept here is depreciation. Depreciation is the answer to every time you wondered why real estate moguls and landlords pay so few taxes. Large items bought for business purposes can be deducted from your taxes, but not all at once. That means e.g. a property worth $250.000 which is deducted from taxes over a 27,5 year period, leads to a reduction in your taxable income of

  $250.000 / 27,5 y = $9.090

  per year! Add that to all the other possible real estate tax deductions, and many owners pay no taxes on their rental income!

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