Hello everyone,
We have owned a plot of land for one year. It is not very large (389 m² (4185 ft²)), but the zoning plan allows quite a lot of development.
We have decided against building a single-family house ourselves.
Friends encouraged us to consider whether we might build a multi-family house on the property as an investment. Especially now that the KFW provides higher repayment subsidies.
Several ideas have emerged.
1. Build a multi-family house maximizing the living area, with all apartments rented out.
2. Build a three-family house, with one apartment per floor. We would live in the ground-floor apartment and rent out the upper and attic floors to two of my siblings.
3. Build a duplex with one of my siblings, where each of us would have and live in an independent condominium unit.
Would you consider doing something like this, or is there anyone here who has already done something similar?
What is the best way to proceed? Should we request offers for all three options and then choose the best one?
We have owned a plot of land for one year. It is not very large (389 m² (4185 ft²)), but the zoning plan allows quite a lot of development.
We have decided against building a single-family house ourselves.
Friends encouraged us to consider whether we might build a multi-family house on the property as an investment. Especially now that the KFW provides higher repayment subsidies.
Several ideas have emerged.
1. Build a multi-family house maximizing the living area, with all apartments rented out.
2. Build a three-family house, with one apartment per floor. We would live in the ground-floor apartment and rent out the upper and attic floors to two of my siblings.
3. Build a duplex with one of my siblings, where each of us would have and live in an independent condominium unit.
Would you consider doing something like this, or is there anyone here who has already done something similar?
What is the best way to proceed? Should we request offers for all three options and then choose the best one?
Matthew03 schrieb:
[Quote: 17km from the city center]
then it is not some remote wilderness nor completely off the radar. 17 (seventeen) km (10.5 miles) from the city center – from an investor’s perspective, it hardly gets a higher “middle of nowhere” factor, unless the city center in question is Munich.https://www.instagram.com/11antgmxde/
https://www.linkedin.com/company/bauen-jetzt/
M
Matthew0331 Jan 2020 14:48I think you misunderstand me.
How do you come to the investor perspective? I have made it clear that I am in favor of selling the building plot to private buyers, who are currently paying astronomical prices. For families or couples looking, the description sounds perfect.
How do you come to the investor perspective? I have made it clear that I am in favor of selling the building plot to private buyers, who are currently paying astronomical prices. For families or couples looking, the description sounds perfect.
N
nordanney31 Jan 2020 14:55Let’s do a quick calculation to get an idea of whether it’s worth it.
270 sqm (2906 sq ft) of living space at €2,200 = €600,000 + €100,000 for additional building costs, etc. = €700,000 total cost.
270 sqm (2906 sq ft) living space rented out at €10 per square meter (should be easily achievable even in a small town) = €34,000 including parking spaces per year.
That’s just under a 5% gross return. It’s quite manageable, even for someone without real estate experience.
270 sqm (2906 sq ft) of living space at €2,200 = €600,000 + €100,000 for additional building costs, etc. = €700,000 total cost.
270 sqm (2906 sq ft) living space rented out at €10 per square meter (should be easily achievable even in a small town) = €34,000 including parking spaces per year.
That’s just under a 5% gross return. It’s quite manageable, even for someone without real estate experience.
11ant schrieb:
That sounds like a typical amateur landlord’s pipe dream. No clue about building classifications, property management, the market, etc., just the naive fantasy of going from dishwasher to real estate mogul on Turm or Bad street.Well, we are not dishwashers, but dreaming should be allowed anyway. I don’t want to become a real estate mogul either, just want to make sensible use of the land.
Matthew03 schrieb:
Given the way the area is described, a very good price for the building plot should currently be achievable. So before I, as a beginner landlord, try it out myself, invest financially upfront, and follow a path that could be prone to mistakes, I would simply offer the land quickly and sell to the highest bidder.
Ask yourself how much extra income the landlord route would have to generate to justify the effort and whether and how quickly that could realistically be achieved...That’s also an idea I will reconsider. The surroundings are exactly as I described.
11ant schrieb:
What do you mean by description of the area? - I see a site plan snippet showing a greenhouse and across from it a development that looks like traditionally grown rural buildings; reading about a nearby daycare center seems like a swallow that alone doesn’t make summer. I don’t see a university or banking city or anything like that, not even a sign of an educated middle-class suburb. To me, the description sounds more like a location well below the radar of real estate investors.I’d be happy to send you the address via PM so you can take a walk with Google Maps and Street View.
The “greenhouse” is now six semi-detached houses; the site plan is from 1995. The houses date from 2007/08.
Matthew03 schrieb:
All in all, that’s clearly more than what we have here, and prices are exploding here.
If I live quietly, can reach everything on foot, and have the train station right outside that takes me to a city (what size, @Yaso2.0?) in 5 minutes... then this is not a backwater and definitely not under any radar.The city I live in has about 660,000 inhabitants, roughly 34,000 live in the district and immediate surroundings.
Tassimat schrieb:
What is the rental apartment supply like in the area? Is it possible to achieve good rental income, or is there an oversupply?It’s possible to get about €11 per square meter (approximately $1 per square foot), and demand is definitely there! There is no oversupply here.
nordanney schrieb:
Let’s just do some calculations to get an idea of whether it’s worth it.
270 sqm (2900 sq ft) living space at €2,200 = €600,000 + €100,000 for additional construction costs etc. = total costs €700,000
270 sqm living space at €10 rent per square meter cold rent (should be easily possible even in a small town) = €34,000 including parking spaces per year.
That means just under a 5% gross yield. Quite feasible, even for a non-expert.A newly built building with three residential units totaling 290 sqm (3,120 sq ft) was offered by the local savings bank for €899,000 about a year ago and is now occupied.
M
Matthew0331 Jan 2020 15:53What is the current land value standard rate? Or better yet: what are private buyers currently paying per square meter (square foot) in that area?
Similar topics