What does it mean to own real estate privately?

Private real estate ownership refers to the purchase and ownership of real estate by individuals or families. This real estate can include residential properties such as single-family homes, condominiums or apartment buildings as well as commercial real estate.

Fundamentals of real estate ownership

Buying real estate in the USA requires several steps:

• Financing: Most buyers need a mortgage(loan) to finance the property
• Equity: Buying in the USA as a foreigner often requires 100% financing
• Property valuation: A professional valuation helps to determine the value of the property
• Conclusion of contract: The purchase contract must be signed and all legal steps completed

Advantages of private real estate ownership

1. Value appreciation: real estate can increase in value over time
2. Regular income streams: rented properties can generate monthly rental income
3. Tax advantages: Tax deductions for mortgage interest and depreciation are possible
4. Personal control: Owners have control over their properties and their use

Private ownership of real estate offers numerous benefits, including the possibility of appreciation and rental income. Tax benefits can also have a significant impact on the overall investment.

Disadvantages of private real estate ownership

1. High initial costs: buying a property requires a considerable investment
2. Maintenance and repairs: owners are responsible for maintaining the property
3. Market risks: Real estate values can fluctuate, which can lead to losses
4. Liquidity problems: Real estate is less liquid than other forms of investment

Despite the advantages, there are also disadvantages that potential buyers should consider. High costs and responsibilities as well as market risks can make investing in real estate complicated.

Taxes for private real estate owners in the USA

Owning real estate in the USA has various tax implications, which can be both positive and negative.

Important tax aspects

1. Property tax: Owners must pay annual property tax on their properties
2. Mortgage interest deductions: Interest on mortgages can be deducted in the tax return
3. Capital gains: Profits from the sale of real estate are subject to capital gains tax

Property owners need to be aware of tax obligations, including property taxes and potential capital gains when selling their property. However, tax deductions can help reduce the overall burden.

Save taxes through private real estate ownership

Private individuals can benefit from various tax deductions associated with owning real estate. These include deductions for mortgage interest, renovation costs and other operating expenses. Careful accounting and tax planning are crucial to making the most of these benefits.

FAQ on private real estate ownership in the USA

What types of real estate can I own?

Individuals can own various types of real estate, including single-family homes, condominiums, apartment buildings, commercial properties and land.

How do I find the right property for me?

Finding the right property requires research and often the assistance of a real estate agent who can help identify suitable properties and assist with the buying process.

Private real estate ownership in the USA for investors

Private real estate ownership can be an attractive way for investors to build wealth and generate passive income streams. However, it is important to understand the market developments and tax implications.

Conclusion

Private real estate ownership in the USA offers numerous advantages, including the possibility of value appreciation and regular income streams. At the same time, potential buyers should carefully consider the disadvantages and tax aspects. If you are thinking about buying real estate, it is advisable to learn about the specific requirements and market conditions and possibly consult a professional to make informed decisions.

Legal forms USA: Foundation & real estate

What types of company are there? If you want to set up your first US company, choosing the legal form is one of the first steps in the company formation process. Whether you want to set up a special real estate company or a start-up, we have summarized all types of companies in the USA for you here – with extra tips for real estate investments, of course.

• Legal forms USA

Additional costs when selling an apartment: Checklist

The sale of an apartment is associated with various costs that can vary depending on the country and region.

Before we take a closer look at the individual fees, here is an overview of the most important cost items:

1. Real estate agent fees
2. Notary costs
3. Land transfer tax
4. Costs for the valuation report
5. Costs for the most important documents

In most cases, owners decide against selling their Apartment privately and instead commission a real estate agent to sell the apartment. Therefore, the agent’s fees usually make up a large part of the additional costs. When a Real Estate Valuation is useful and what it costs, you can find out in our guide. The agent’s fees usually make up a large part of the additional costs. Let’s take a closer look at them.

Agent Fees for Marketing & Sale

If you hire a Real estate agent to sell your apartment, you usually have to pay a real estate commission. In the Real estate commission calculator, you can see all the costs for buyers and sellers at a glance. This commission varies depending on the agent and can range between 3% and 7% of the sale price. The agent fees typically include the costs of marketing the property, conducting viewings, assisting with the negotiation of the purchase price, and drafting the purchase contract.

Between 3% and 7% of the purchase price

Notary costs during the transaction

When selling a property, the process through a notary is legally required. Therefore, you cannot avoid notary fees here either. Notary fees consist of various charges that are determined according to the purchase price of the property and are legally set. They amount to 1.5 to 2% of the purchase price. This includes, for example, the basic fee, which is based on the value of the property, as well as the fees for the creation of documents and certificates.

Between 1.5 and 2% of the purchase price

In most cases, the buyer covers the notary fees.

Land transfer tax: To be paid by the buyer

When selling an Apartment, the real estate transfer tax also applies. This is also paid by the buyer. The amount of the real estate transfer tax varies by federal state and ranges between 3.5% and 6.5% of the purchase price. It is calculated based on the purchase price and must be paid to the tax office within a few weeks after the purchase.

Between 3.5% and 6.5% of the purchase price

Find out more about taxes here:

• Selling an Apartment Taxes

Costs for property valuation

Whether it’s a duplex apartment or a micro apartment – before you sell your apartment, you first need to know how much the property is worth. For this, the apartment is inspected by a certified appraiser for its condition and possible defects, and a valuation report is created. This forms the basis for the later selling price. The costs for a valuation report can vary depending on the scope and type of appraisal, ranging from several hundred to several thousand euros.

Fees for the most important documents

For the sale of an apartment, you also need several documents that you must not only hand over to the new owner, but also need for the purchase contract and the sales process. These include, for example, the energy certificate, a land register extract, and the zoning plan. You can get the consumption-based energy certificate for less than 100 euros, while the demand-based certificate will cost you several hundred euros. Don’t forget the land register extract either. This costs 10 euros if not notarized and 20 euros if notarized.

An overview of some costs for obtaining the sales documents:

• Consumption-based energy certificate: under 100 euros
• Demand-based energy certificate: over 100 euros
• Unnotarized land register extract: 10 euros
• Notarized land register extract: 20 euros

Optional: Renovation & Modernization Costs

To increase the property value and raise the selling price, some owners decide to renovate and modernize their apartment shortly before selling. The costs involved depend both on the scope of the renovation work and the materials used, as well as the size of the apartment.

Conclusion: Calculate Costs in Advance

In summary, it can be said that selling an apartment is associated with various costs that should be carefully calculated in advance. Detailed planning and preparation can help avoid unpleasant surprises and unnecessary expenses. Therefore, it is advisable to thoroughly inform yourself in advance and create a detailed cost overview.

What is the advantage of a partial sale?

Are you considering the partial sale of your real estate? In our guide, we have already reported extensively on the partial sale of real estate and, of course, answered the question: is a partial sale of real estate sensible? Selling to your own children, grandchildren – how does that work?

The big advantage of a partial sale is the quick transfer of the purchase price. After all, you save yourself many steps in the real estate sale, for example, most of the communication with potential interested parties, as well as the subsequent credit checks to find a serious buyer.

Partial sale to private individuals possible?

Selling a portion of real estate privately is certainly possible. Anyone can acquire shares in your property and thus become a co-owner. If you have found a direct contact for partial sales, you can save yourself the time typically spent searching for buyers, as you would when selling an entire property.

Selling Privately via Portal?

Not everyone has family members, usually children, who would buy a part of the property. What are the alternatives?

Most private buyers who search for offers through real estate portals will not accept a partial sale, but rather want to buy the entire property. If you want to sell part of a property, you should look for people in your immediate surroundings who might be interested in an investment. In this case, you should contact one of the partial sale providers.

Tip! The Best Partial Sale Providers

In this overview, I have compiled the most important partial sale providers for you, comparing their advantages, disadvantages, and conditions! Simple, understandable, and clear.

• Comparison of Partial Sale Providers

Partial sale of Apartment, House, Plot – everything is possible.

Example: 20% share sold to children:

Right of residence and right of use: Costs?

After the partial sale of your house you only need to agree on the use of the property.

What costs arise from the partial sale?

If you want to retain the sole right to live in and use the property, the partial buyer will ask you for a usage fee, known as the usage charge. Naturally, in a private partial sale, for example, a partial sale to your children, you can agree that no usage charge needs to be paid.

Although the usage charge is negotiable, how much should you expect in case you have to pay it?

Providers usually ask for 3-5% p.a.

In our guide on the topic Partial sale providers compared, we have already calculated the different usage charges of the larger providers (financial companies). If you sell part of your property to a company, such as a financial company, the usage charge is typically between 3% and 5% (of the sold share) per year.

In simple terms, if you sell 100,000 euros worth of your property, you pay an annual usage fee of 3,000 to 5,000 euros.

Tip! Secure yourself with the right of usufruct

In all cases, you should, however, protect yourself, especially regarding your lifetime right of residence and usage rights. The technical term for this is called Nießbrauch. The Nießbrauch right determines that you have a complete right of residence and usage of the property until the day of your death. Accordingly, you are independent of all decisions made by your future co-owners. Even if they are your children or grandchildren.

The Nießbrauch right grants you lifetime residence and usage rights to the property

Taxes on private partial sales

The name says it all, this tax is meant to restrict speculation in the real estate market.

Explaining the speculation tax

With the speculation tax, the legislature says: whoever buys a property may only sell it tax-free after X years – even in the case of a partial sale. X = the number of years varies depending on whether you bought the property as an investment (rent out) or live in it yourself (own use).

Speculation period:

• Foreign use – 10 years
• Own use – 3 years

Amount of speculation tax

The amount of speculation tax always depends on your tax rate. As a result, the speculation tax can quickly exceed 25% and for high earners it can quickly reach 40%.

Partial sale of property: The guide

They want to learn more about the topic of partial sale of real estate? Then take a look at my comprehensive guide here, in which I really cover all aspects, from the advantages, through the disadvantages, to possible alternatives, such as a mortgage loan or also a real estate pension. Of course, everything about taxes in a partial sale is also included. All experiences:

• Partial sale of real estate

Here you will now learn everything about the most expensive roads at Lake Starnberg. Back to the list: Most expensive roads in Germany!

Most expensive roads around Lake Starnberg

Around Lake Starnberg and in the entire “Fünfseenlandschaft” cultural landscape, there are numerous plots of land and properties which are particularly sought after due to their proximity to the water and nature. Here, in the middle of the beautiful landscape, a property is ideal as a main residence or as a holiday home and is a perfect investment. The real estate market in this area is very popular and those who are lucky enough to own a house here in a prime location can consider themselves very lucky and enjoy a lot of comfort.

Overview with the most expensive roads

Before we want to go into the most expensive streets in Hamburg with information such as location and prices per square meter: Here is an overview of the most expensive streets with the associated district. The purchase prices for properties here range on average between €11,800 and €25,000 per square metre.

• Front lake road
• Celtic Road
• Lakeside Road
• South lake road

Südliche Seestraße: Real estate with a view of the lake

While the north of Lake Starnberg convinces with its small town feeling and the community of Seeshaupt in the south with its family atmosphere, the east of Starnberg is considered a former residence of German nobility. And it is precisely here that the most expensive street in all of Bavaria is located, with its breathtaking view over the entire lake. Property prices in the southern lakeside street are around 25,000 euros per square metre.

The price per square metre here is

Maximum price up to 25,000 €/ sqm

Here you will find top adresses like:

• Ammerland Sailing Club
• Water rescue Ammerland

Southern lakeside road at Lake Starnberg (map):

Get a picture of the southern lake road yourself and explore the area in a virtual way!

Vordere Seestraße: Real estate at Lake Wörthsee

In contrast to the other streets, vordere Seestraße is located on Wörthsee, which, along with Lake Starnberg, is part of the “Fünfseenland” cultural landscape. Here are numerous beautiful properties in the midst of nature and directly on the northwest shore of the Wörthsee. Most of the properties offer a spacious property including a large garden. In addition, many have their own jetty including private lake and beach access. Here you can also moor a small boat. There is a small harbour including a beach bar in the vicinity.

The price per square metre here is

Maximum price up to 11,800 €/ sqm

Here you will find top adresses like:

• Beach bar “Seaside resort
• Ross Swamp
• Hiking area PP Wörthsee

Vordere Seestraße at the Wörthsee (Map):

The area around the Wörthsee is beautiful and has a lot to offer. Make yourself a picture and explore the lake in a virtual way!

Keltenstraße: large plots in the middle of nature

Keltenberger Straße is located to the west of Lake Starnberg and is in the district of Pöcking. It stretches directly next to the Pöcking-Possenhofen sports club and is about two kilometres from the lake. On the Keltenstraße you will mainly find large estates with spacious properties and green areas. In addition, there is a small piece of forest southeast of the road. Due to this location near the lake and in the middle of nature, Keltenstraße is one of the most expensive streets on Lake Starnberg.

The price per square meter here is up to:

Maximum prices up to 12,450 € / m²

Here you will find top adresses like:

• Sportclub Pöcking-Possenhofen eV

Celtic Road at Lake Starnberg (Map):

Seeuferstraße: Real estate with private lake access

The lakeside road is located on the eastern shore of Lake Starnberg and offers some numerous properties, which are highly sought after. In particular, the large plots and estates are especially popular and promise a lot of luxury. A further advantage is the private lake access, which offers some properties. Many properties are equipped with their own house jetty, so that you can access the lake from your own garden or even moor a small boat.

The price per square meter here is up to:

Maximum prices up to 22,550 € / m²

Here you will find top adresses like:

• Holiday apartment on the lakeshore
• Ambach Chapel
• Farmhouse Hirn

Lakeside road at Lake Starnberg (map):

Why not explore the area yourself and take a virtual look at the surroundings!

Overview: Most expensive residential streets at Lake Starnberg

Sources: Image / Engel und Völkers / Lukinski

Most expensive streets in Germany: real estate, districts & prices per square metre

Berlin, Munich, Sylt & Co: Germany’s metropolises are home to some of the most luxurious properties. Inselstraße in Berlin, Königinstraße in Munich and Südliche Seestraße on Lake Starnberg – only those who can afford it live here! Would you like to buy a property here? Find out everything about Germany’s most exclusive streets, what makes them so special and above all: how much a square metre costs here.

• Most expensive streets in Germany: properties, districts and prices per square metre – List

Living at Lake Starnberg: villa, property, apartment

With a population of around 1.7 million, Munich is not only Germany’s third largest city, but also one of the country’s strongest economic centres. It is also famous for its high quality of life and the surrounding nature. Skiing in the Alps or hiking, as well as countless lakes for summer activities are in the immediate vicinity Thus, Lake Starnberg not only enjoys great demand as a holiday destination, but also as an attractive place to live.

• Living at Lake Starnberg: Villa, property, apartment in Starnberg, Seeshaupt & Co.

Selling land: Agricultural land, meadow, acre & Co.

You may have already read our great guide on selling land, or perhaps you have read more specific guides, for example on selling woodland land.

For those who are dealing with the matter of land sale for the first time, the question surely arises:

• How do I sell my agricultural land?
• Which step do I start with?
• Who advises me, prepares expert opinions & Co.

Here are a few pointers for selling farmland, agricultural land and other, more specific land. You can also read more about the process, mistakes and risks, as well as taxes when selling land.

Sell privately or with a professional?

The question is answered relatively quickly. There are various parameters that influence the selling price. These include, for example, the property valuation, as well as a solid and capital-strong buyer network, but also negotiating skills. After all, it is not “only” about a condominium, but about more complex, agricultural usable areas, with all the addition around soil expertise, forecasts and development possibilities.

Minimize effort, maximize profit

Selling agricultural land privately, for example through real estate portals, not the best idea.

1. What do you do with all the requests?
2. What documents, papers and expert opinions do you need?
3. Who sends info and makes phone calls for questions?
4. Who really has the credit rating and willingness to buy?
5. How many surveys do you want / need to do?
6. Who prepares and conducts the negotiations?
7. …

From credit rating (creditworthiness) to viewing appointments and negotiations: Time is money. Therefore, in this country 70% + sell with the help of professionals, such as an estate agent.

Sell privately?! Risk private sale

Time is of the essence. If you are not under pressure to sell, excellent. Then you may be able to make a mistake or two. But who wants to do that? Here is a recent example of a client who wanted to sell his property in Berlin. Private.

Example of agricultural land in the Berlin hinterland

Here is an example of a client who approached us, a typical case. It was an area in the Berlin area that was to be sold. The mistake in brief: private sale without sufficient credit check or financing confirmation from a bank. The result: months of delay and abandonment.

The seller has advertised privately on a known portal. Promptly came many messages, but almost all conversations ran into the void. Weeks passed.

Error: Insufficient creditworthiness and verification

After months, finally found a person who had the will and the credit rating – supposedly. So after the site visit talk about checking the financing, by the buyer’s bank and wait. Again, a few weeks pass.

Then you get after further weeks a feedback from the buyer and/or prospective customer that the financing was rejected with the first bank, therefore now with a second house bank one inquires. You wait.

After another few weeks passed, he still had no confirmation of financing from a bank, no preliminary purchase agreement, and no notary appointment.

Conclusion – pressure and frustration:

Suddenly there is more and more pressure to sell, and at the same time frustration rises.

You wouldn’t believe how many private sellers have this exact story happen to them.

That’s why over 2/3 of the properties are sold with professionals on the side (brokers and the like).

Professional land trading for agricultural land

Preparation is the key so that you do not lose months in the sale of A and B locations, and even years in C locations.

Preparation is the key: even with agricultural land

However, the work starts much earlier, which is another reason why working with a broker is advantageous.

Tip on the broker’s commission! Privately, the law currently provides that 50/50 is shared (buyer, seller). In commercial trade you can also put 100% on the buyer.

So, in principle, in the commercial trade it does not even cost you money. For this you get the network when it comes to a reputable real estate dealer.

• What documents and papers do you need?
• Which groups of buyers are you addressing with this particular property?
• Do you want everyone to know you want to sell your farmland?
• Should everyone know the value (your asset growth)?

Discretion: neighbours, envy and competition

In addition to the time factor (= money), for many sellers of agricultural land is also important that your property is made discreet, anonymous. From competition in the region to family, the neighbors or even receiving large sums of money. There are several reasons why a majority of sellers want to sell anonymously and discreetly.

Personal network: buyers and investors

Professional property trading looks quite different, of course. Here it is not about marketing in real estate portals, personal buyers are adressed, investors, funds but also foreign investors groups.

Investors from abroad: Profitable business

Foreign investors for a farmland? Yes! Many are looking for good returns and capital investment in this country. Due to the attractive returns in this country, but also the good soil quality and water quality (groundwater and water sources) in general, there are also very many investors from near and far abroad looking for land.

The big advantage for you as a seller, here the money sits a little looser than in the country – simply said.

Central for this is of course again a renowned real estate agency.

Exclusive is fast: supply and demand

Another strong advantage for you on the seller side:

Deals are being closed much faster.

Why? The properties are traded exclusively and the offers are made only to individuals. This exclusivity ensures the scarcity of supply and thus increases the demand on the customer side.

Time is money! Especially wealthy customers do not want to waste time

Wasting time, in which, for example, several interested parties are at one property. Business should be done quickly.

Find a real estate agent: Renowned office or from the region?

Therefore, consider working with a regional real estate agent who does what everyone does: Posting your farmland widely on all real estate portals. After that, hundreds of people will write, there will be many conversations, emails, plus phone calls. Very much time passes, few really have the creditworthiness, the will, as described before.

The process of finding a farmland takes months, sometimes even years.

Time is money! Addressing investors

Here is another psychological aspect that gives you advantages in off market trading:

When professional investors or their employees see that properties are listed on real estate portals, the question immediately arises: Why? Why has the property not found a buyer? No one would even continue to deal with this object. After all, there are thousands of advertisements. Who is supposed to see through all of them?

Family offices, real estate funds, etc.

Family offices, real estate funds and others therefore speak directly with renowned real estate offices and have only exclusive properties presented to them. Then everything goes very quickly.

In the off-market area, you will find the big family names, i.e. family offices, real estate funds, other institutions, which are approached individually and specifically, depending on the purchase profile.

This is all called off market trading.

Selling farmland: Procedure, taxes and tips

Would you like to learn more about selling agricultural land? Then take a look at our detailed guide on the subject of selling land. Here we talk about the concrete procedure, in all the individual phases of the sales process. You will learn more about the typical mistakes that are made when selling and of course everything about taxes when selling land.

• Sell land

Agricultural land / field with spring?

Selling a water well – appraisals, brokers, negotiations, process and taxes, there are also many questions when selling a water well. Is now the right time for you to sell? And if so, what is the most effective way to sell? Water is a scarce resource. Even though over 71% of our planet’s surface is water, there are fewer and fewer productive, clean water sources. Low supply, high demand: don’t just think regional buyers, think mutual funds and yes, food companies too. For that, you need a broker with an exclusive network. Whether a sole proprietor or a water cooperative, learn about the matter of selling here.

• Sell field with spring