Hello everyone,
I need some help and advice and hope to get a few suggestions on how to proceed.
In 2010, we bought an end-terrace house in northern Berlin in a very desirable location (120 sqm (1,292 sq ft) living space, 250 sqm (2,691 sq ft) garden, 3 floors, parking space, excellent infrastructure) at a very favorable price (bankruptcy sale).
This house is now to be sold for a new construction project, as private circumstances have changed and the house no longer meets many of our new requirements.
What is the best way to proceed here?
How can one coordinate the sale of the current house with the new project?
What options are there to handle this financially in the smartest way possible?
What risks should be considered?
What does a term like “property swap” mean in this context?
There is still an outstanding loan on our current house of about €98,000.
According to our research, the market value is around €200,000. Is it correct to assume that €200,000 sale proceeds minus €98,000 remaining loan and prepayment penalty equals my net profit?
The property has been continuously owner-occupied by us (so no capital gains tax to consider?).
Regarding the new construction project
We have clear ideas about the new house and have set a maximum budget of €350,000 for all related costs.
We have a net monthly income of €4,700, which I believe is above average. Are these assumptions realistic?
It would be great to receive some guidance or suggestions here.
I need some help and advice and hope to get a few suggestions on how to proceed.
In 2010, we bought an end-terrace house in northern Berlin in a very desirable location (120 sqm (1,292 sq ft) living space, 250 sqm (2,691 sq ft) garden, 3 floors, parking space, excellent infrastructure) at a very favorable price (bankruptcy sale).
This house is now to be sold for a new construction project, as private circumstances have changed and the house no longer meets many of our new requirements.
What is the best way to proceed here?
How can one coordinate the sale of the current house with the new project?
What options are there to handle this financially in the smartest way possible?
What risks should be considered?
What does a term like “property swap” mean in this context?
There is still an outstanding loan on our current house of about €98,000.
According to our research, the market value is around €200,000. Is it correct to assume that €200,000 sale proceeds minus €98,000 remaining loan and prepayment penalty equals my net profit?
The property has been continuously owner-occupied by us (so no capital gains tax to consider?).
Regarding the new construction project
We have clear ideas about the new house and have set a maximum budget of €350,000 for all related costs.
We have a net monthly income of €4,700, which I believe is above average. Are these assumptions realistic?
It would be great to receive some guidance or suggestions here.
Musketier schrieb:
A small tip:
Any potential profit (difference between purchasing the house in 2010 and selling the townhouse) is subject to income tax as a speculative transaction.No, in my case not, because it was solely and continuously owner-occupied.
...from Eiphone
N
nordanney10 Feb 2015 14:27Then just sell it. And do it now! That way, you won’t be stressed and can build at your own pace – you’re looking for a safe option after all.
nordanney schrieb:
Then just sell. And do it now! That way you won’t have any stress and can build at a relaxed pace – you’re looking for a safe option anyway. Yes, that’s what I want.
But it requires that I find someone who will buy, pay, and move in only in a year or later. Or some sort of bridge financing. But I don’t really understand how all of that works in practice.
...from Eiphone
ductom81 schrieb:
No, in my case not, because it is exclusively and continuously owner-occupied.Oops, you are right... my knowledge of income tax has become a bit outdated. I had forgotten the exemption from taxation.
lastdrop schrieb:
So, those are your options. And they have already been explained in 70 posts...Yes, but somehow I still don’t fully understand the practical process. Ideally, I would like to actually receive the money from the bridge loan so I can use it just as if it came from my own account.
When you don’t deal with these financial matters daily, it’s easy to feel completely out of your depth.
...from Eiphone