Hello dear forum members!
Background: My boyfriend bought a house at a forced auction, quite cheaply, basically for the land value. He placed the lowest bid, assuming others would outbid him. However, no one did, and now he owns a house (which we/he do not urgently want to live in ourselves, at least not for the time being).
The house:
Overall, the house is in good condition, at least at first glance. Some renovations are necessary (e.g., the heating system). The last major refurbishment was apparently done in the 1980s. I can’t say much more about it at the moment.
My question:
Based on your experience, what is the best course of action? What makes sense financially?
For example:
1. Simply sell the house again (possibly after partial renovation and definitely at a higher price)
2. Renovate the house and rent it out as soon as possible? (The house could accommodate two tenants, and a part of it used to be a restaurant, which might be leased out again)
3. Renovate the house completely and then sell it.
What other options do you see from your experience? Where is the return on investment best?
I look forward to your answers and advice!
Best regards
Berenike
Background: My boyfriend bought a house at a forced auction, quite cheaply, basically for the land value. He placed the lowest bid, assuming others would outbid him. However, no one did, and now he owns a house (which we/he do not urgently want to live in ourselves, at least not for the time being).
The house:
Overall, the house is in good condition, at least at first glance. Some renovations are necessary (e.g., the heating system). The last major refurbishment was apparently done in the 1980s. I can’t say much more about it at the moment.
My question:
Based on your experience, what is the best course of action? What makes sense financially?
For example:
1. Simply sell the house again (possibly after partial renovation and definitely at a higher price)
2. Renovate the house and rent it out as soon as possible? (The house could accommodate two tenants, and a part of it used to be a restaurant, which might be leased out again)
3. Renovate the house completely and then sell it.
What other options do you see from your experience? Where is the return on investment best?
I look forward to your answers and advice!
Best regards
Berenike
Now, let’s see some photos!
And tell us something about the location.
To me, it unfortunately sounds a bit like a remote outback area. (My interpretation based on the isolated auction date with the mayor present.)
I have to fully agree with nordanney. Around the Düsseldorf area, it’s rare to find anything affordable on the market. But when there is, it’s usually old houses with an abandoned pub inside. Even here, those tend to be hard to sell.
In a more remote area, even more so.
So I wouldn’t count on reselling the property immediately for a profit.
If you renovate the house so that you would want to move in yourself, it will be converted into a single-family home, right?
If there is generally demand for that in the town, I would focus on renovating it for your own use and watch the market.
Once you have the change of use permission and have done some nice work yourself, I can well imagine that you could make a good profit.
Otherwise, just live in it yourself.
And tell us something about the location.
To me, it unfortunately sounds a bit like a remote outback area. (My interpretation based on the isolated auction date with the mayor present.)
I have to fully agree with nordanney. Around the Düsseldorf area, it’s rare to find anything affordable on the market. But when there is, it’s usually old houses with an abandoned pub inside. Even here, those tend to be hard to sell.
In a more remote area, even more so.
So I wouldn’t count on reselling the property immediately for a profit.
If you renovate the house so that you would want to move in yourself, it will be converted into a single-family home, right?
If there is generally demand for that in the town, I would focus on renovating it for your own use and watch the market.
Once you have the change of use permission and have done some nice work yourself, I can well imagine that you could make a good profit.
Otherwise, just live in it yourself.
Buying a plot contaminated by a building without any cleanup, just for the raw land price, is already a real knee-slapper, but then to top it off with a vacant restaurant space included is even better. Here's to that Dujardin, I guess it's time for bed now—this day can hardly get any better. Thanks for the little bedtime treat to lift my spirits!
All that’s left for me is to quote the late Uli Wickert: the weather.
https://www.instagram.com/11antgmxde/
https://www.linkedin.com/company/bauen-jetzt/
All that’s left for me is to quote the late Uli Wickert: the weather.
https://www.instagram.com/11antgmxde/
https://www.linkedin.com/company/bauen-jetzt/
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Pinkiponk19 Jul 2020 08:46pagoni2020 schrieb:
Buying such a property and—according to their own statement—without any experience, in my opinion, is an absolute act of Harakiri... I would like to point out that for many forum members (unless they have completed the questionnaire), we do not know whether the purchase amount is "play money." It may be that some members, for whatever reason, currently have plenty of money available. This is likely an absolute minority, but they do exist.
Whether your friend naively bought a house (or not) and whether that was a smart decision (or not) is completely irrelevant in this thread and does not change the situation. Advice like "My tip to you is to leave it be. If he, as you say, likes to take risks (in this case pure gambling), he should do it alone. You will most likely be very glad at some point that you never signed under it," is something you should learn to ignore in this forum. No one who doesn’t know you personally very well can judge this over the internet—only you can decide such matters for yourself.
I think your question can’t be answered without more information. Whether to live in the house yourselves (if you even want to) depends on your financial situation and your current living conditions. You should ask yourselves whether you can afford the renovation financially and whether you can imagine living in the renovated house afterward. Everything is possible; the question is just how much time and money it will take. Otherwise, if you can or want to rent it out and end up with a small profit each month, that’s fine too. In the absolute worst case, you’ve just bought a piece of land. When reselling, you’ll need to consider capital gains tax, planning permission, etc. It’s important to first check whether it’s even worth it or if you will ultimately incur a loss.
I think your question can’t be answered without more information. Whether to live in the house yourselves (if you even want to) depends on your financial situation and your current living conditions. You should ask yourselves whether you can afford the renovation financially and whether you can imagine living in the renovated house afterward. Everything is possible; the question is just how much time and money it will take. Otherwise, if you can or want to rent it out and end up with a small profit each month, that’s fine too. In the absolute worst case, you’ve just bought a piece of land. When reselling, you’ll need to consider capital gains tax, planning permission, etc. It’s important to first check whether it’s even worth it or if you will ultimately incur a loss.
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Pinkiponk19 Jul 2020 09:38nordanney schrieb:
Conversion (change of use from commercial to residential required) usually costs a lot of money. This is interesting information. I have often wondered why the two former restaurants in our town were never converted into residential spaces. In general, the conditions are usually good: location in the town center, large, professional kitchen, and the former dining area as a nice, spacious open room. Thanks for the info.
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Pinkiponk19 Jul 2020 09:39moHouse schrieb:
Now, let's see some photos! I agree, I would also like to see some photos.