Flat as an investment Example calculation

Letzte Aktualisierung am 27.04.2022

Whether an investment makes sense or not basically depends on the question of whether your assets increase or decrease. This is also the case with a flat as a capital investment.
Does an investment in a property make sense? Our "Apartment as a capital investment example calculation" , which you can find below, provides information on this. 

Wenn wir uns das aktuell anziehende Zinsniveau anschauen, lautet die Antwort: Grundsätzlich Ja!
Denn wie auf unserer Seite zum Finanzierungsvergleich zu sehen ist, sind die Zinsen im April 2022 etwas angestiegen. Immer noch schlecht für Sparer mit Tagesgeld. Gut für Anleger in eine Wohnung als Kapitalanlage.

Wir befinden uns momentan in einer Phase steigender Zinsen. Trotzdem liegt der Zinssatz aktuell unterhalb der Inflationsrate, so dass die Inflation Ihre aufgenommenen Schulden quasi teilweise abbezahlt.

Eine weitere Anlagemöglichkeit sind Aktien. Aktien sind den meisten Deutschen noch immer zu riskant, darum fragen sich immer mehr Menschen:

"Is real estate worthwhile as an investment?"

To answer this question, we would like to show you right away, using an example calculation, when a property makes sense as a capital investment.

A flat developed by us as an investment:

How does a flat work as an investment?

The basis and example calculation of a flat as an investment is quickly explained:

  • First you acquire a GOOD and FIT for the purpose property
  • You finance the purchase of the property via a bank
  • The equity capital you bring in should generally cover the ancillary purchase costs - in this way you optimise the return on equity and at the same time do not have to bring in too much of your own money.
  • The bank loan - consisting of interest and repayment - is paid off monthly
  • But your tenant also pays his rent every month, so he basically pays off your loan instalments and thus your property
  • The rent is more or less a transitory item until the loan is paid off and the flat is yours - without much financial effort on your part.
Real estate as an investment Example calculation

The above investment example shows a representative income property as purchased by one of our clients. The bottom line is that it helps to calculate the cash flow of the property to find out what is left each month after deducting all costs. 

We would be happy to introduce you to a currently available income property in an information session, e.g. via Google Meet. Simply arrange an appointment. Appointment

Calculation real estate capital investment

To calculate the cash flow of a property, only the expenses are deducted from the income.

Zu den Ausgaben gehören vor allem die Finanzierungskosten, also Zinsen und Tilgung. Hierbei ist interessant, wie sich Ihre monatlichen Zahlungen an die Bank zusammensetzen. Die Rate ist jeden Monat gleich, doch zu Beginn besteht sie hauptsächlich aus Zinszahlungen, während sehr wenig des Darlehens getilgt wird. Jahr für Jahr verringern sich jedoch die Zinszahlungen, da der Zinssatz immer nur auf den Restdarlehensbetrag anfällt.
Und so dienen Ihre Raten mit der Zeit immer mehr der Tilgung und weniger den Zinszahlungen.

Example calculation for an income property

Example calculation for an income property

In addition to interest and repayment, the non-apportionable ancillary costs in the form of maintenance reserves and administration costs must be deducted from the income.
You can find out which administrations are important for you in this article.

The income that opposes the above-mentioned expenses is your rental income. This should cover all the above-mentioned costs (financing instalments + non-apportionable costs).
The surplus generated must be declared as part of your income tax return.
After deducting the tax, you will then have the cash flow of your property.

But now we would like to explain this to you with a concrete numerical example.

Let's assume that you want to buy an apartment in Nuremberg for a purchase price ofe would like to purchase a flat in Nuremberg at a purchase price of 170,000 euros. The flat has 70 sqm.

The ancillary purchase costs amount to 8,755 euros, consisting of 3.5 % land transfer tax (in Bavaria) and 1.65 % notary and land registry costs. The land transfer tax varies from federal state to federal state, the average is around 5 %.

This means a total investment of 178,755 euros, of which you provide 8,755 euros as equity and finance 170,000 euros through a bank.

The rental income amounts to 7,152.01 euros annually (net annual cold rent).

Rentintakings7,152.01 Euro
abzgl. Darlehenszinsen (bei einem Zinssatz von 2,8 %)4.760,00 Euro
less maintenance reserves 840,00 Euro
less administrative costs650,00 Euro
Surplus before redemption and taxes902,01 Euro
less redemption (2 %)3.400,00 Euro
Yield after redemption (per year)
-2.497,99 Euro
Monthly yield
-208,17 Euro

This is a sample calculation. Of course, most items will vary. The interest rate, for example, is a variable that depends on your credit rating and equity situation. The better your credit rating, the lower the interest rate.

Auch die Verwaltungskosten können sich in Ihrem Fall anders darstellen. Es kommt hier darauf an, welche Verwaltung Sie benötigen oder in Anspruch nehmen möchten.
Nicht jede Verwaltung ist obligatorisch.
Wir haben in unserem Zahlenbeispiel unser 360°-Paket angesetzt, da es alle drei Verwaltungen (WEG, Sondereigentums- und Mietverwaltung) umfasst.

What has not been taken into account in the above calculation are Taxes and a possible change in the value of the property.

This would go beyond the scope of this article. However, you are welcome to Contact personally.

But very briefly: We always calculate cautiously; for this we have four different ways of looking at things.

    1. Is the property losing value?
    2. Does the value remain constant?
    3. What would be an average performance?
    4. When would the performance be very good?

Our credo: A property as an investment must be worthwhile even if the property does not increase in value.
No one can look into the future. That is why we always approach our calculations conservatively, so that there are no negative surprises.

When is an investment property worthwhile?

To keep it short: An investment property is worthwhile when the Rental yield is right.
You can see how this is made up in the following "Property as an investment calculator":

Calculate formula rental yield

Calculation of the gross rental yield

In the numerical example above, this results in a gross rental yield of 4.2%:

Example Calculate rental yield

Example calculation of gross rental yield

This corresponds to a value that can usually already generate a neutral to slightly positive cash flow.

However, in order to achieve such a rental yield, certain conditions must be met.
The Property Location Valuation plays a very important role, but also the rentability of the property as well as suitable credit conditions.

In any case, your goal should always be to achieve a positive or at most slightly negative cash flow.

If you have any questions about the calculation or about Cash flow real estate you are welcome to ask them in our community, on Facebook or in a personal conversation. We will then go through the individual items with you step by step and advise you without obligation and free of charge.

Do you have any questions about the flat as an investment example calculation? Then please contact us.

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Real estate as an investment

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