Location, property type and development: Investment property

When it comes to the type of investment, the first thing you have to choose from is different types of apartments and houses. However, even more important, as all real estate investors know, is the location of the property. So if you are flexible in your property search and are looking for a good, profitable capital investment in Germany, regardless of the region, then you will find our guide here.

Tip! All cities, one guide: Real estate in Germany

In the guide you will find the most important German cities in focus, with the individual districts, advantages and disadvantages. We also give you an overview of the property prices in the individual districts, which we present here.

In this first guide you will find the complete overview of Germany. Here you will also get further information for each individual city, from the federal capital Berlin to the world-famous Bavarian capital Munich.

Guidebook contains:

• Property types (house and apartment)
• Facts and figures for all major cities in Germany
• Further links to the important districts
• District information with pros / cons
• Real estate prices
• Real estate statistics and development
• Company formation in Germany
• Legal forms (reference to real estate)
• Large real estate companies in Germany (stock exchange)

Which property is the best?

When deciding on the type of investment, you need to consider not only your own preferences, but also the target group. If you are not buying your property for your own use, but for rental, the wishes of the potential new tenants will also play a role.

The more typical, the easier to rent (60-120 sqm, 2-5 rooms)

Of course, the easiest apartments to rent in Germany are those that have a “typical” cut. Here we are talking about a typical apartment, between 60 and 120 square meters, with two, three, four to five rooms. This type of apartment, or even in the format of houses, rents out the easiest. Such apartments can use both single people, as well as couples and families.

If you want to invest your money in the luxury segment, the standard is of course quite different. A 260 m² penthouse in Berlin, with 1.5 rooms, is something rather fancy and only something for single people, maximum for couples. The rent is high, the rooms are not shared.

So the typical cut is easier to rent, much easier. For special types of apartments, types of houses, they first have to find the right tenant or the right tenant. The more special, the more difficult. Tip. Read this interview on “Classic or exotic investments”: Which properties should I invest in?

Property search and selection:

• Own preferences (region, property type)
• Own use or renting
• Preferences of the future target groups (tenants)
• Typical, ideal cut: 60-120sqm, 2-5 rooms apartment / house

House types: Terraced house, detached house, villa

Detached house, terraced house, semi-detached house or even designer villa, the possibilities in architecture and construction are so diverse that we have written here a separate guide on the subject of the different forms of houses. Especially when buying the first property very important, because each type of house brings its own individual advantages and disadvantages.

Advantages, disadvantages and differences at a glance:

• House types

Apartment types: Attic, Old building, Penthouse

Just as there are numerous types of houses, there are also different types of apartments. Top floor apartment, granny flat, maisonette or even penthouse and loft. Learn about the different types of apartments you can invest in here. When choosing an apartment, pay attention to the tips from above so that your apartment is not “too special” for the German market.

Comparison of apartment types:

• Apartment types

Depending on which target group you want to address as a real estate investor, you should therefore pay attention to the “marketability” of your apartment and houses in Germany in advance when buying (also when building) them. This is how you keep the vacancy rate of your real estate low.

But sometimes scarcity creates the right demand! Accordingly, we come back to the situation.

Germany: Cities, Facts and Figures

Now let’s move on to the German “Big 4”, the 4 largest cities in Germany: Berlin, Hamburg, Munich and Cologne. Tip! Further, interesting regions such as Frankfurt am Main, for your capital investment can be found here:

• Real estate in Germany

Berlin: Capital in East Germany

Berlin, as the capital, is the center of Germany when it comes to culture, business and politics. Berlin is also a cultural, economic and political heavyweight in Europe, alongside Paris and London.

Since reunification in 1989, Berlin has experienced a real estate boom like never before. Since then, the Berlin real estate prices rise, year after year. Meanwhile, it even goes so far that the city’s politicians introduced their own laws to take the “pressure” out of the real estate market, as well as the “Mietpreisbremse”.

Good times for both sides: Buyers and sellers of real estate. Buyers can achieve a good sales price, sellers in turn, can expect good returns now and in the future. But which districts in Berlin are interesting for your own investment? Here is a look at the German capital, real estate prices in Berlin and its districts:

• Berlin

Berlin (map), location in East Germany:

Hamburg: Port city and metropolis in the north

Hamburg is especially for the German celebrities the destination. Here you live relatively withdrawn from the hustle and bustle of Berlin. Fresh sea air, just two hours to the capital, with a fast drive, plus the most beautiful villas in Germany.

Through its history alone, Hamburg is a very special place. A city that has always been characterised by internationality due to its port. This is reflected in the cityscape and also in the real estate industry. Because Hamburg is not only interesting for German investors, also international investors invest money here in the north of Germany. But which districts are worthwhile for investors who are not from Hamburg and do not know the city?

Here’s a look at the city, its neighborhoods, real estate prices, advantages and disadvantages:

• Hamburg

Hamburg (map), location in North Germany:

Munich: The “typical German” in the south

Munich is pretty much the most “typical” German city if you ask foreign investors. Bavarian products like beer, events like the Oktoberfest, Lederhosen or even a big, international car brand with 3 letters: BMW. Munich is known worldwide and especially sought after by American and Asian investors.

Munich’s city centre is very different, e.g. compared to Berlin or Cologne, here it is very tidy, clean and accurate. Security and law is very important in Bavaria. The real estate prices in Munich are among the highest in Germany.

Therefore, here is a closer look at the city, districts and real estate prices in Munich:

• Munich

Munich (map), location in South Germany:

Cologne: Media City in West Germany

Cologne was and is an important media city. Through one of the largest German private broadcasters (RTL), but also through modern influences, e.g. through influencers (well-known people) in social networks, such as YouTube and Instagram.

If you compare the city with others, e.g. Berlin, Hamburg or Munich, you know that you won’t find great architecture in Cologne. The city was built up relatively quickly, as it suffered a lot during the Second World War. The fast buildings from the 60s, 70s and 80s dominate the cityscape.

Under certain circumstances the ideal leverage for your investment, because here the property prices will still develop. Cologne is located in NRW, the largest economic area in the whole of Europe, with over 20 million people in the catchment area throughout North Rhine-Westphalia and nearby cities such as Düsseldorf, Bonn and also Frankfurt am Main.

Here’s a look at the city, its neighborhoods, advantages and disadvantages:

• Cologne

Cologne (map), location in West Germany:

Düsseldorf: Immediate neighbour of Cologne

When looking at Cologne, here of course also briefly a look at Düsseldorf. The city is only 20, 30 minutes away from Cologne and is also part of NRW, the largest economic zone within the European Union. Advantages for the return of the property and the value development, also in the long term.

• Düsseldorf

From the “micro perspective” (cities and districts), back to the “macro perspective” on the German real estate market.

Tip! Investment in nursing care real estate and nursing care apartments

There are currently 4.1 million people in need of nursing care in Germany. 731,000 people are cared for in full inpatient nursing facilities. Germany has the most expensive healthcare system in the world. The biggest return factor when investing in nursing care real estate is, of course, the development of demographics, but also the economic capacity of a country, which ultimately supports the nursing care system and its financing. Like many rich or wealthy countries, Germany’s population is getting older and older.

Buying nursing care real estate as an investment?

Few people who want to invest in real estate, come in the first thought to care real estate, or apartments. But it is worth taking a look at this type of investment. Nursing homes are springing up all over Germany, not just in conurbations, as the population is getting older and older. There are properties and facilities for senior citizens in every district. They offer themselves thus investment object for regional investors, as capital investment in the proximity, in addition, for supraregional investors. How is the market for nursing care real estate developing in Germany? Which type / which location is interesting for investment as a yield property?

We have identified 5 factors in the first look at this form of investment.

• Capital investment nursing apartments

Numbers: Statistics, shares and companies

Last but not least, after the location and the appropriate property type comes the development of the region. In the individual articles, you have already learned a lot about the individual cities and also the individual districts. Here we would like to give you a more detailed look at the available real estate statistics in Germany.

Development in the real estate market

Let us first come to the most important question, the long-term perspective, in retrospect and with a view to the future:

How will the real estate market in Germany develop over the next few years?

Germany is the number 1 in Europe when it comes to the real estate industry. No matter if it is the construction sector, administration or even trade with real estate. If you look at the statistics of the last decades, there is only one way, upwards.

If you will, Germany’s real estate market is not fully developed to this day. Just remember the 70s, 80s buildings from Cologne. Of course, historical factors are part of the real estate stock. For example, the reunification of East and West Germany.

In eastern Germany in particular, there are whole swathes of land where real estate was extremely cheap just a few years ago and even today real estate prices are still not comparable with the cities of the old Federal Republic, especially the real estate prices in Hamburg and Munich. At the same time, the old Federal Republic is still marked by the effects of the Second World War. Meaning: While in other cities like London, Paris there are imposing buildings and architecture in every street, here, e.g. in Berlin, there are still whole districts with old buildings, which gradually, new, modern and more complex building concepts break.

If you are looking for an impressive skyline in Germany, you have only one choice, Frankfurt am Main. Due to various factors, the European building regulations, but also regulations of the cities themselves, there is no city in Germany with a high-rise skyline, except in Frankfurt. Comparing the German cities, you can quickly see how different the regions are here.

Statistics and charts say more than 1,000 words, here you will find a detailed, large collection on the latest and older statistics, for comparison. All surveys, analyses and evaluations are official and come from the Federal Statistical Office in Germany:

• Real Estate Statistics

Real estate on the German stock exchange

The stock market also provides an insight into how the German real estate industry is developing. This is where you find the big companies, the stock corporations and REITs. They build the large high-rise buildings in Frankfurt am Main, are landlords for millions of people in Germany, stable for decades. Among the best known representatives are e.g. Vonovia, Deutsche Wohnen and Patrizia Immobilien. Read more about the German stock market, especially the real estate sector:

• Real Estate Stocks

Establish a real estate company in Germany

Last but not least, let’s take a look at company forms you can choose in Germany. The following legal forms are interesting for foreign investors who want to establish a company in Germany, but also for those who are local and want to become real estate investors themselves. Because, in Germany, as everywhere, there are different legal forms, depending on the number of shareholders, the goal of the company, share capital and much more.

You can invest in real estate, rent out a house, privately, e.g. for retirement. But if you own several properties and want to buy several investment properties, you will not get around the formation of companies. Yes, exactly, the formation of companies, in the majority. That is why it is important to get to know the forms such as the limited liability company, more specifically the real estate limited liability company, but also a family foundation.

Do not worry – However, everything begins with the first company. Which one is the best? Where are the differences and what are the advantages and disadvantages of the individual forms of business? Here you will find a great overview of the possible legal forms in Germany:

• Legal forms

If you’re actually starting your very first company, here’s another very basic guide to the startup process.

• Form a company

Conclusion: Capital investment in Germany

Let’s sum it all up in one question:

Investing in Germany: A good idea?

Advantage: Strength of the real estate market – As you can read above, Germany is the strongest real estate market in Europe. The real estate statistics show that the growth has existed for decades and is well above any monetary devaluation (inflation). Accordingly, the yields for the different types of houses and apartments are stable and very attractive compared to the other European countries.

Advantage: Legal certainty – Many investors appreciate the legal certainty in Germany. In Germany, everything is very meticulous, but there are clear laws, structures and procedures. That is why many investors from all over the world come to Germany. Security is a big aspect, especially for wealthy buyers and sellers.

Germany is an excellent location for real estate and investors.

Are you looking for good investments in Germany? Get in touch with us.

• Contact

Is the statutory health insurance worth it?

This question cannot be answered in a blanket manner. If you earn a high income from self-employment or freelance work, the monthly premium can be quite cost-intensive due to its dependence on income. Before you register as a voluntary member of a statutory health insurance, you should necessarily compare and check how high the premium is in your case and whether you are not covered more favorably in a private health insurance.

In the comparison, also consider that the private insurers include an annual premium increase and that it can become expensive with increasing age. A simple switch from the private health insurance back to the statutory health insurance is not so easy. For this reason, you should carefully consider whether you can pay the premiums of private health insurance in the future from your income, or whether it comes to problems with income losses. In the case of statutory health insurance companies, you cannot choose between different tariffs, but as a voluntary member you benefit from the advantage of paying a lower premium if you have a lower income.

Compare GKV and PKV: Save premiums and get the best benefits!

In the past, it was common for self-employed persons and freelancers not to register with statutory health insurance funds. There is no obligation to do so, as you can choose between private health insurance and the benefits of statutory health insurance.

To make the right decision, the focus should be on the benefits. Low premiums offer financial advantages, but are not sufficient for comprehensive health protection in the event of an insurance claim. You will make the best decision if you focus on the benefits as well as on your personal insurance premium and choose your health insurance partner carefully. If the benefits of the statutory health insurance are not sufficient for you due to ever more restrictions, it is recommended that you take out supplementary health insurance to extend the benefits and tailor them to your individual needs.

Further important information on the subject of insurance

In the insurance industry, a distinction is made between compulsory, necessary and recommended insurance. Health insurance, like long-term care insurance, is one of the contracts that every German citizen is required to take out by law. If you finance a house, further insurances can be added, by which the bank and you are secured.

Supplementary health insurance – for whom is it worthwhile?

The benefits provided by statutory and private health insurance are continually decreasing. Some desired benefits, such as the single bed room and treatment by a chief physician in hospital, are not included in the standard tariff of a health insurance. Likewise, in the case of dental prostheses with implants, you have to pay for all services outside the cost coverage of the health insurance companies out of your own pocket and therefore have to reckon with high additional costs. With supplementary health insurance, you compensate for your own financial expenses and have the option of adapting your health insurance to your claim and your individual needs.

• Find out more about supplementary health insurance here.

Private health insurance – advice on benefits and services

It is well known that as a private patient you enjoy a number of advantages, such as not being put on hold for specialist appointments. The privileges of private health insurance pay off, as long as you choose your insurance coverage wisely and based on your needs. Self-employed, freelancers, private individuals and anyone who is not covered by health insurance through their employer or a social agency can opt for private health insurance and benefit from the rate comparison. Generally, you have from a certain gross income per year to choose between statutory health insurance or private health insurance.

• Learn more about private health insurance here.

Health – Advice on insurance

Since 2009, there is a mandatory health and long-term care insurance in Germany prescribed by law. Exceptions are excluded, so that you must also have health insurance as a self-employed person, freelancer and low-income earner. If you are employed subject to compulsory insurance, you are automatically covered by health insurance through your employer and do not have to take care of your basic health protection on your own. The situation is different if you do not have a job that is subject to compulsory insurance and in this case you have to take care of your health insurance yourself.

• Learn more about health here.

Advantages of supplementary health insurance at a glance

Do not pay amounts above the subsidy of your health insurance out of your own pocket in the future. With the benefits of supplementary health insurance, you save money and make an important contribution to your health. Before you book an additional tariff, you should inform yourself about the options in the area of supplementary health insurance and find the offer that suits you. Supplementary cover is available for dentures and dental treatment, for spa stays and rehabilitation, for visual aids and alternative treatment by a non-medical practitioner. Do you want to have free choice of doctor and room occupancy in hospital? Then we recommend supplementary health insurance that gives you this freedom.

Insurances for freelancers and self-employed

Freelancers and self-employed persons do not necessarily have to obtain the daily sickness allowance via their regular health insurance with a noticeable increase in tariffs. Here, too, supplementary health insurance can help and provide cover in the event of prolonged loss of earnings due to an impairment of health. Since the premium amount for supplementary health insurance depends on both age and health, it is worthwhile to decide early on the desired coverage outside of health insurance. Above all, it is important that you make a decision based on your needs. If you do not wear glasses, for example, a supplementary insurance to cover the costs of visual aids is unnecessary. It is different with dentures and with desired special treatments in the hospital or alternative medicine. Here, supplementary health insurance makes sense for everyone, as these benefits offer general advantages and more decision-making power in the event of an insurance claim.

Supplementary health insurance possible despite previous illness?

Are you interested in supplementary health insurance but already have a pre-existing condition? We recommend that you openly communicate your health basis and rule out the possibility of being denied benefits in the event of an insurance claim because you were not honest about existing pre-existing conditions. We would be happy to support you in finding a favourable supplementary health insurance despite a pre-existing condition and to assist you as an experienced partner in comparing tariffs and benefits.

Further important information on the subject of insurance

In the insurance industry, a distinction is made between compulsory, necessary and recommended insurance. Health insurance, like long-term care insurance, is one of the contracts that every German citizen is required to take out by law. If you finance a house, further insurances can be added, by which the bank and you are secured.

Statutory health insurance as a self-employed person and freelancer

As a worker and employee, you are automatically a member of a statutory health insurance fund. The registration and payment of the monthly premiums is done by your employer. But also in self-employment or freelance work you can register in a statutory health insurance and benefit as a voluntary member of the benefits of health insurance. Since there are different statutory health insurance companies, a comparison can also be worthwhile in this case and serve as a basis for you not to necessarily remain in the health insurance chosen by your employer or your local health insurance. In general, the statutory health insurance funds do very well even with voluntary membership.

• Find out more about statutory health insurance here.

Private health insurance – advice on benefits and services

It is well known that as a private patient you enjoy a number of advantages, such as not being put on hold for specialist appointments. The privileges of private health insurance pay off, as long as you choose your insurance coverage wisely and based on your needs. Self-employed, freelancers, private individuals and anyone who is not covered by health insurance through their employer or a social agency can opt for private health insurance and benefit from the rate comparison. Generally, you have from a certain gross income per year to choose between statutory health insurance or private health insurance.

• Learn more about private health insurance here.

Health – Advice on insurance

Since 2009, there is a mandatory health and long-term care insurance in Germany prescribed by law. Exceptions are excluded, so that you must also have health insurance as a self-employed person, freelancer and low-income earner. If you are employed subject to compulsory insurance, you are automatically covered by health insurance through your employer and do not have to take care of your basic health protection on your own. The situation is different if you do not have a job that is subject to compulsory insurance and in this case you have to take care of your health insurance yourself.

• Learn more about health here.

Benefits and services in private health insurance

While the statutory health insurance companies offer standard benefits, you have a whole range of advantages as a private patient. When taking out private health insurance, you can not only choose between different providers, but also between different tariffs. The amount of the premium depends on your profession and age, your state of health when you take out the insurance and the benefits you want. Even as a privately insured person, you can choose a basic tariff for private health insurance, which corresponds in its portfolio of benefits to the tariff of the statutory health insurance funds and is considered the cheapest tariff. We only recommend the basic cover in extreme emergencies, for example if you temporarily have less income and for this reason have to save on health insurance for a short period of time.

Private tariff: Date hedging

With a private tariff, you secure prompt appointments with a specialist, can individualise the level of cost coverage and, for example, choose chief physician treatment and a single room for hospital stays directly in the insurance contract. You can also choose 100 percent cost coverage for dental prostheses, so that you do not need supplementary health insurance and can receive all the benefits you want directly through your private health insurance.

Further important information on the subject of insurance

In the insurance industry, a distinction is made between compulsory, necessary and recommended insurance. Health insurance, like long-term care insurance, is one of the contracts that every German citizen is required to take out by law. If you finance a house, further insurances can be added, by which the bank and you are secured.

Supplementary health insurance – for whom is it worthwhile?

The benefits provided by statutory and private health insurance are continually decreasing. Some desired benefits, such as the single bed room and treatment by a chief physician in hospital, are not included in the standard tariff of a health insurance. Likewise, in the case of dental prostheses with implants, you have to pay for all services outside the cost coverage of the health insurance companies out of your own pocket and therefore have to reckon with high additional costs. With supplementary health insurance, you compensate for your own financial expenses and have the option of adapting your health insurance to your claim and your individual needs.

• Find out more about supplementary health insurance here.

Statutory health insurance as a self-employed person and freelancer

As a worker and employee, you are automatically a member of a statutory health insurance fund. The registration and payment of the monthly premiums is done by your employer. But also in self-employment or freelance work you can register in a statutory health insurance and benefit as a voluntary member of the benefits of health insurance. Since there are different statutory health insurance companies, a comparison can also be worthwhile in this case and serve as a basis for you not to necessarily remain in the health insurance chosen by your employer or your local health insurance. In general, the statutory health insurance funds do very well even with voluntary membership.

• Find out more about statutory health insurance here.

Health – Advice on insurance

Since 2009, there is a mandatory health and long-term care insurance in Germany prescribed by law. Exceptions are excluded, so that you must also have health insurance as a self-employed person, freelancer and low-income earner. If you are employed subject to compulsory insurance, you are automatically covered by health insurance through your employer and do not have to take care of your basic health protection on your own. The situation is different if you do not have a job that is subject to compulsory insurance and in this case you have to take care of your health insurance yourself.

• Learn more about health here.

Health insurance – statutory, private, with or without supplementary insurance?

The health insurance is not only because of the legal obligation, but generally the most important insurance. A cost coverage of the necessary and preventive treatments at the doctor exclude that you have to go into debt and refuse important medical measures for cost reasons. With the statutory health insurance you receive all standard benefits, which you can optimise and tailor to your personal requirements with a supplementary insurance. The example of dental prosthesis shows why additional insurance is worthwhile and protects you from costs incurred for dental prosthesis which, far from standard treatment, can involve co-payments in the four to five-digit range.

Insuring the self-employed and freelancers

As a self-employed or freelancer and as a private individual, you are responsible for your own health insurance. But which company should you take out a contract with and which tariff fits your requirements for optimal health protection? Only if you compare the different options and check the benefits included in the contract, you can make the right decision and ensure your health comprehensively. Especially the area of supplementary insurances should be examined with the utmost care and should not be disregarded. In order to receive the desired benefits in case of need, an additional health cover for treatments outside the cost coverage of a health insurance can be worthwhile.

Comparison advisable for health insurance

There are 110 statutory health insurance companies in Germany. In addition, there are numerous private health insurances with different tariffs, as well as supplementary insurances, which are a good addition to the actual health insurance with different benefits. Without a comparison, in which your requirements for the insurance cover are the focus, the conclusion of a tailor-made tariff is hardly possible.

You can use a free online comparison to get an overview of the options and the differences in tariffs. Especially if you are interested in a private health insurance or voluntary membership in a statutory health insurance, it is important that you inform yourself about the costs in comparison to the benefits. Keep in mind that the most expensive health insurance does not automatically have to provide the best benefits for you.

More information about health:

Statutory Health Insurance

As a worker and employee, you are automatically a member of a statutory health insurance fund. The registration and payment of the monthly premiums is done by your employer. But also in self-employment or freelance work you can register in a statutory health insurance and benefit as a voluntary member of the benefits of health insurance. Since there are different statutory health insurance companies, a comparison can also be worthwhile in this case and serve as a basis for you not to necessarily remain in the health insurance chosen by your employer or your local health insurance. In general, the statutory health insurance funds do very well even with voluntary membership.

• Find out more about statutory health insurance here.

Supplementary health insurance

The benefits provided by statutory and private health insurance are continually decreasing. Some desired benefits, such as the single bed room and treatment by a chief physician in hospital, are not included in the standard tariff of a health insurance. Likewise, in the case of dental prostheses with implants, you have to pay for all services outside the cost coverage of the health insurance companies out of your own pocket and therefore have to reckon with high additional costs. What to expect: closing costs. With supplementary health insurance, you compensate for your own financial expenses and have the option of adapting your health insurance to your claim and your individual needs.

• Find out more about supplementary health insurance here.

Private health insurance

It is well known that as a private patient you enjoy a number of advantages, such as not being put on hold for specialist appointments. The privileges of private health insurance pay off, as long as you choose your insurance coverage wisely and based on your needs. Self-employed, freelancers, private individuals and anyone who is not covered by health insurance through their employer or a social agency can opt for private health insurance and benefit from the rate comparison. Generally, you have from a certain gross income per year to choose between statutory health insurance or private health insurance.

• Learn more about private health insurance here.