Why Buy Property In Germany?
Why Buy Property In Germany?
There are plenty of reasons to buy property in Germany. There are the really obvious reasons, such as the wonderful landscape, the rich history, the vibrant culture, and the amazing selection of beers and sausages, but there’s also the financial aspect. Did you know that there has never been a better time to buy property in Germany?
First things first, it’s not even difficult for a foreigner to buy property in Germany. It’s completely legal. The process is simple and relatively painless, requiring little more than an accepted form of identification, the exchange of funds, and a housing contract witnessed by an official notary. It really is as simple as that. It’s all very well that the process is nice and easy, but why should you even consider buying property in Germany in the first place?
Here’s a quick look at some of the biggest reasons to get on the German property ladder!
Germans Typically Don’t Buy Property
Welcome to the land of renters! Many Germans prefer to rent their properties from landlords instead of buying their own places outright. There are a number of reasons for this. Firstly, it’s not really encouraged by the government. There aren’t many subsidies or tax reliefs for those buying their own properties. There’s also a strong history of renting that was borne out of necessity during the aftermath of World War II. In short: many Germans prefer the security of renting from a landlord.
What does this mean for you? There’s an abundance of houses on the market with low demand for them at the moment. If you’re looking at finding a bargain, you’re going to find one in Germany. But how does that benefit you in the long run?
Germany’s Stable Economy
Despite fears of a looming recession, Germany’s economy is very stable. What’s more, it’s steadily growing. Stable economies attract business investors, and business investment attracts workers. Solid business investment and higher employment lead to steady growth in the economy and increasing demand for places to live. This is especially true around the Frankfurt am Main region, which is Germany’s financial hub.
A Rising Population
As we mentioned above, the steady and stable growth of the German economy attracts people from all over the world. Thanks to an attractive higher education policy, more international students are moving to Germany and calling Deutschland home. Investment from the business world is actively drawing more skilled workers from all over the world to come and settle down in Germany. The local population is increasing too, and it won’t be long before more people are wanting to get in on the homeownership wagon.
Real Estate Value Increases
Historically, the value of German real estate has been on the rise since World War II. However, it must be said that it hasn’t skyrocketed as it has in neighboring countries like the United Kingdom. It has been rising though. Any property bought today will almost certainly be worth more in a decade; due to an increase in demand. As long as you expect stable appreciation, the only way is up.
Excellent Quality Homes
Even if you’re not searching for a quick investment, you can rest easy knowing that German houses are built with longevity in mind. Many of those picturesque half-timbered houses that look like they’re straight from one of Grimm’s Fairytales are older than the United States, and they’ll remain standing for many hundreds of years more. Modern houses are strong and robust, designed thoughtfully, and built to strict building standards.
Low Interest Rates
And now to the most attractive reason to buy property in Germany: super low interest rates. The interest rates on mortgages can be as low as 1.2%. With low house prices and excellent mortgage terms, it’s not unrealistic to purchase a house with very little capital. In fact, many US Army personnel have been clever enough to use their Living Quarters Allowance and Overseas Housing Allowance to pay off the mortgage in their new German home. It can be done very easily, and it makes for an interesting and almost risk free way of breaking into the German housing market.
So Why Should You Get Involved Today?
Prices rise, demand increases, and the sooner you can get your foot in the door, the sooner you can pay off your mortgage! And then there’s the little matter of Brexit. You might not think that the comings and goings of our British friends could have much of an effect on the German housing market…but it could. You see, London has been the European financial hub since stocks were worth trading. The impending British Exit may encourage banks to pack up from their British home in search of a newer, more European-friendly city. That city could be Frankfurt. It might not be, but it could be.
An influx of cashed-up bankers could force a miniature housing boom, which could drive up prices in your desired area. Or, if you’re savvy, you could capitalize on that boom and rent out your property to those looking for quick access to one of Europe’s most exciting financial hubs.
Of course, that’s all conjecture. There’s no denying it though: the sooner that you can get in the door, the sooner you can start building your life in Germany, as a homeowner, as a landlord, or as an investor. The market is open for business: are you ready?
Reach out to us today if you want to purchase your first or 100th property in Germany!
