Buying a house: house as an investment

In times of crisis, security is required – and for many Germans, it consists of their own four walls. In view of the uncertainty on the financial markets, more and more people are betting on a house as an investment – the building society LBS alone brokered around 4.4 percent more houses and condominiums in the first half of 2009 – almost all properties from second hand. After all, the purchase of a used property is an interesting alternative to a new building – the house can be viewed before the purchase, compared with other offers and immediately occupied. And the low interest rates for home buyers make the start interesting right now.

Take a close look at the property, apartment or house

Nevertheless, many home buyers take the search for the right property lightly, even though visits are actually complicated and buying a home is considered the most important economic decision of their life. Nevertheless, home buyers should not shy away from viewing the potential domicile. The general rule is: feel your way in from the outside. If a building gives cause for concern during the external inspection, it should not look better inside.

One of the first points of contact in a family home or terraced house should be the basement – mold or other unpleasant surprises tend to nest here due to the moisture, and cracks in the walls and musty smells are particularly common here. During the visit, it is recommended to keep a log and also take photos. The consumer advice centers have developed a 37-page checklist that laypersons can use to expertly survive a house inspection. Numerous details are requested on the sheets that an unfamiliar home buyer would normally not pay attention to. For example, it records whether basement walls with a floor barrier layer or a horizontal barrier layerare sealed against moisture. Several dozen details of the external inspection are requested – the house buyer only has to check whether none, some or many of the damage is present. Particular attention is paid to the outer walls, doors, windows and shutters of the rooms.

The life story of a property

In addition to a close look at the external condition of the property , prospective buyers should also deal intensively with the previous “life story” of the building . Because the year of construction of a house says a lot about possible problems. Because many building materials such as pressboard, which were used as wall cladding in house construction in the 1980s, are now considered problematic due to their components such as formaldehyde . For decades, builders were not worried about heat loss due to insufficiently insulated walls – it was only in the 1960s that this topic came to the fore. Leaky flat roofs occur in Germany especially in houses from the period between 1960 and 1980.

And some substances are not only unhealthy, they are also simply banned: “In the 1970s, materials were used that are no longer permitted today,” warns Siegfried Seifert , valuer at Dekra Real Estate Expertise in Saarbrücken. As a rule of thumb, topics such as noise and fire protection as well as thermal insulation were largely neglected before 1960, and chemical aspects such as the risk of asbestos were taken into account from the 1980s.

Purchase price of a property: Compare offers

Once the used dream property has been found, the question arises whether the price for the new home is reasonable. Here laypersons should consider a few points of view and above all make a comparison with other properties that are offered in the same region. For security, it is advisable to ask for a floor plan – sellers often cheat a few square meters of the living space to make the property more attractive.

Lay buyers should also note that each property purchase involves additional costs – these are usually ten percent of the purchase price. In addition to the brokerage fee , expenses for real estate transfer tax , entry in the land register and the lawyer are due. In addition, another cost trap should be excluded: If you buy a house that has been standing for a few years, you cannot necessarily assume that there will be no further development contributions for the municipality. It is imperative to ask the office.

Save money by viewing with experts

With all the charm of an old property, interested parties should keep an eye on the costs – because buying the building is usually not enough: “You should get an accurate picture of upcoming modernization costs,” remembers Siegfried Seifert, valuation specialist at Dekra Real Estate Expertise in Saarbrücken. Modernization projects usually provide the greatest additional financial need. If an extension becomes necessary or the building services are overhauled, a bargain quickly turns into a financial nightmare.

In any case, it is safe to say that anyone who does not rely solely on their own nose when it comes to a house inspection: “Prospective buyers should always be accompanied and advised by a professional during the site inspection,” advises Siegfried Seifert, valuation specialist at Dekra Real Estate Expertise in Saarbrücken. But such an expert is expensive – around 100 euros per hour are not uncommon. The expert’s tip: In order to save money, laypeople can complete the first viewing appointment alone and, if they are seriously interested in buying, can bring the experts to a second appointment.

This can estimate the costs that the maintenance of the property should cost in the next few years and where the new owner must immediately take action. Because the property collects plus points if it has already been renovated or modernized. But here too there are pitfalls: Assessing the building is much more difficult because the renovation can lead to new construction problems. This is where the inexperienced homebuyer’s assessment ends at the latest.

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