Real Estate Investor Magazine South Africa May/June 2019 | Page 56

GERMANY
Berlin is
Booming
Long-term investors can potentially
make over 300% capital gains return
BY NICCI TALBOT
T
he Berlin property market in Germany is booming!
If you have ever owned and rented property in Berlin
property for the last ten years or even self-occupied
property for more than three years, now is an excellent time to
sell. After this period, the so-called speculative tax is dropped
which can be up to 40% savings in capital gains tax. Extraor-
dinary high prices are being achieved for sellers and some get-
ting over 300% capital growth.
Regulations such as rental price brakes and environmental
protection have led to a huge shortage of available vacant
properties in popular areas like Kreuzberg, Prenzlauer
Berg, Mitte, Neukolln, Friedrichshain in the east and
Charlottenburg, Wilmersdorf, Moabit, Friedenau and Steglitz
in the west.
Investors who timed the market well who own one, two
or three properties here, who are seeing excellent capital gain
returns.
•
•
•
A two-room 62 sqm Altbau apartment with balcony
in Charlottenburg purchased for 90.000,00 euros
in 2007 and sold for 280.000,00 – that is a capital
growth of over 300%
An open-plan duplex 1990’s 81 sqm penthouse
apartment in Prenzlauer Berg purchased for 170.000
euros in 2008 and achieved an offer price of 450.000
– a 260% increase
A one bedroom 54 sqm first floor Altbau apartment
•
near Bergmannkiez in Kreuzberg purchased by the
current owner for 48.000,00 euros in 2006 and now
valued at 240.000,00 euros – or an amazing 500%
capital growth
All these properties were vacant or would become
vacant at the point of purchase by a new owner.
Similar properties sold with sitting tenants would be
valued at approximately 30% less depending on the
terms of the tenancy and current or potential rental
yield.
What will increase the value of my property?
Certain factors such as the location and condition, an
appropriate layout, as well as the size and features can increase
the value of a Berlin property tremendously. For example, two-
bedroom apartments with 100 square meters of living space
are hardly ever sought. The optimal apartment has, according
to a recent study from a large German property portal, an
average of 66 square meters and 2.5 rooms.
•
In Berlin the situation for condominiums is crucial. If
the apartment is in a trendy neighbourhood or near a
specific location, the price can be much higher than
the next block just around the corner. Similarly, the
close connection to public transport plays a major
role as well as the orientation of the apartment and
its location within a multi-family house,” says Achim
Amann, Director at Black Label Properties.
RESOURCES
Black Label Properties
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MAY/JUNE 2019 SA Real Estate Investor Magazine