If you want to know which home savings provider offers the best conditions, you can immediately compare the current offers in the Immobilien-Erfahrung home savings calculator.

Building savings contract for young people: saving for housing projects

Whether a building savings contract is interesting for you as a young person depends on various factors, such as your financial possibilities and future plans. A building savings contract can be useful if you plan to buy a property or carry out renovation work. By taking out a building savings contract, you can save money over a fixed, longer period of time that you can use for these purposes.

Home savings for young people at a glance:

• Saving early for housing projects later
• Also useful if there are no concrete plans
• Financial cushion for unforeseen events

A building savings contract can also be useful if you don’t have any concrete plans yet, but you want financial security for the future. By taking out a building savings contract, you can build up a financial cushion that provides financial security in the event of unforeseen events.

Youth bonus: Offers and discounts

Some Bausparkassen offer special rates or discounts specifically for young customers, known as “youth bonuses”. These offers may vary from one Bausparkasse to another and may include, for example:

• Increased repayment subsidies when contracts are signed
• Lower minimum deposit amounts
• Special conditions for housing finance
• Discounts on other insurances

However, there is no universal youth bonus in Germany. It is advisable to compare and check the various offers and providers.

Age recommendation: building savings under 18 years of age

As a rule, you can take out a home savings contract from the age of 18. However, there are also offers from building societies that are aimed at young people under 18. In such cases, the contracts are usually signed by the parents or guardians. The parents also pay the premiums.

There are several reasons why it can make sense for parents to take out a building savings contract for their children.
Reasons for concluding a building savings contract before the age of 18:

• Support future planning
• Financial support
• Build a solid financial base
• Lower repayment rates for later projects
• Formation of savings and redemption discipline

It can be difficult for young people to save regularly and think about the future. A home savings contract can help develop a savings and repayment discipline early on and get them used to regular savings behavior.

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6 tips for young building savers and those who want to become one

If you want to take out a home savings contract, there are many things you should consider. In this checklist, you’ll find our top 6 tips for young home savings customers and those interested in home savings.

Our tips:

1. Compare conditions before signing
2. Date of completion
3. Consider residential earmarking
4. Consider contract duration (long-term commitment)
5. Compare costs of the contract
6. For questions: Advice from experts

Conditions: It is important to compare the offers of different building societies to find the best offer for your own situation. In doing so, the conditions such as redemption subsidies, interest, acquisition and administration costs as well as the services offered should be taken into account.

Time of conclusion: It is advisable to conclude a building savings contract early in order to benefit from the advantages of long-term savings and repayment.

Earmarking: The building savings contract is usually tied to a specific purpose, primarily for financing a home, it is important to ensure that the contract meets one’s wants and needs.

Contract duration: Building savings contracts usually have a longer duration of 15-25 years, it is important to note that you are committed to paying monthly contributions in the long term and take into account possible changes in your financial situation.

Cost: It is important to fully understand the risks and costs of the contract to ensure that you benefit financially from the contract in the long run.

Advice: It is advisable to seek advice from a financial advisor before taking out a building savings contract to ensure that the contract meets your needs and that you understand all the risks and costs.

Are you interested in a building savings contract? Compare immediately current conditions for your building savings contract in the Immobilien-Erfahrung.de building savings calculator.

Fees for the building savings contract

How much does building savings cost? When concluding a bauspar contract, various fees are incurred that must be taken into account in order to enable a realistic cost calculation. These can include, among other things, acquisition and management fees, costs for insurance or processing fees for loans from the bauspar loan.

An overview of possible fees:

1. Connection fee
2. Annual contributions
3. Account management fees
4. Processing fees
5. Early repayment fee

In addition to these fees, other fees may apply depending on the provider. Now you can find out what the fees are and when they apply.

Connection fee

Some building societies charge what is known as a closing fee when a building savings contract is concluded. The fee may vary depending on the provider and tariff. The closing fee is used to cover the costs incurred in setting up the contract, such as preparing contract documents, carrying out credit checks and processing applications.

The connection fee at a glance:

• Contract setup fee
• E.g. for contract documents or credit check

In some cases, these fees are not charged or are already included in the contract terms.

Annual contributions

In order to maintain a building savings contract, many building societies charge annual contributions. The annual contribution is used to cover the costs of managing and operating the contract as well as the interest on the saved capital. Some providers charge lower contributions if you pay in a larger investment amount or choose a longer term, while others charge higher contributions if you pay in a smaller investment amount or choose a shorter term.

The annual fee summarized:

• To maintain the building savings contract
• Annual payment from saver to building society
• Amount depends on various factors

Account management fees

Account maintenance fees are incurred annually or quarterly and are used to cover the costs incurred in administering the contract, such as preparing statements, making transfers, and processing inquiries. The amount of the account management fees varies depending on the provider and the contract.

Use of the account management fee:

• Preparation of accounts
• Execution of transfers
• Inquiry processing

Account management fees for home savings contracts are controversial. In a ruling from 2022, the Federal Court of Justice (BGH) issued a decision on the charging of account management fees for home savings. However, it is currently only valid for customers of BHW Bausparkasse. Some home savings banks therefore do not charge this fee.

Handling fee

Processing fees are mainly incurred in the event of changes to the contract. During the savings phase, you have the option of adapting the contract individually to your circumstances.

Processing fees may apply for:

• Changes to the contract (term, savings target, amount of installments)
• Conducting audits or reviews in connection with the contract
• Preparation of certificates or proofs

The amount of the processing fee varies depending on the provider and can range from a few euros to several hundred euros.

Early repayment fee

The early repayment penalty is also known as a disbursement fee. It is due if you terminate a home savings contract prematurely before the agreed term has expired. It serves to compensate the provider for the lost interest and repayments that he had expected if the contract had remained in force until the end of the term.

Fees apply in the event of premature termination of the contract.

Conclusion and tips for those interested in building savings

It is important to be aware of the provider’s fee structure before signing a home loan contract. You should make sure that you take into account the cost of any additional services to be sure that you choose the offer that best suits your personal needs and goals. Comparing the terms of different providers and contracts can help you make the best choice.

Here are our tips that people interested in building savings should consider before signing a contract:

• Find out about the provider’s fee structure and take this into account in your cost calculation
• Compare the offers and conditions of different providers to make sure you get the best deal for your needs

Building savings contract: Saving for real estate financing

A building savings contract is a special type of loan. Building savings contracts usually consist of a savings plan and a real estate loan and are concluded with a building society. The basic idea of building savings and the associated building savings loan is the promotion of home ownership. You conclude the contract if you plan to build or renovate a house in the future or buy an existing property.

The building savings contract quickly summarized.

• Special type of loan
• Consists of savings plan and real estate loan
• Is concluded with a building society
• Serves to promote home ownership

Compare immediately current conditions for your building savings contract in the Immobilien-Erfahrung.de building savings calculator.

Building savings: How a building savings contract works

When you conclude a home savings contract, you specify various points that remain the same over the entire term of the contract. For example, you specify your savings target, also known as the building savings amount, and the term. A typical building savings contract has a term of between seven and ten years.

The building savings contract then goes through three phases:

1. The saving phase
2. The allocation phase
3. The loan phase

You will now learn the details of the individual phases.

Savings phase: Savings period in which equity is built up

The savings phase is the first phase that a building savings contract goes through on the way to financing your property. During this time, you save a contractually agreed percentage amount of the building savings sum. In addition to the savings target, which is between 30% and 50% of the bauspar sum, the duration of the savings phase is also defined when the contract is concluded.

The monthly savings rate is calculated according to the savings amount and term. During the savings phase, it is also possible to make special payments in addition to the monthly payments or even to provide the agreed minimum building savings balance through a one-time payment.

The savings phase in summary:

• Fixed part of the building savings sum is saved up
• Over a set period of time
• Monthly savings rate depends on savings amount and term

As soon as the savings target is reached, the building savings contract enters the second phase.

Allocation phase: Distribution of the building society loans by the building society.

The second phase of bauspar contracts is known as the allocation phase. In this phase, the amount of the bauspar loan is determined. The amount is determined by the difference between the building savings sum and the building savings balance. In order for the contract to be ready for allocation, certain requirements must be met.

The requirements for an allocation of a building savings loan are:

1. The agreed building savings balance was reached
2. Further allocation criteria were met

The exact allotment criteria vary from one building society to another. As soon as the allocation conditions are met, the loan is allocated and can be drawn down. The loan can only be used for residential purposes. This includes, for example, the construction, purchase or renovation of a property.

The loan is tied to a residential use.

Loan phase: disbursement and repayment of the real estate loan

Once you have decided to take out the loan, your building savings contract enters the final phase: the loan phase.

It begins directly after the allocation phase and starts with the loan application. The terms and conditions of the loan were already agreed when the building savings contract was concluded. This is often an annuity loan.

The amount of the building savings sum determined at the beginning influences the amount of the loan and consequently also the monthly repayment installments. In contrast to a construction loan, which often leaves a residual debt at the end of the fixed-interest period, the home savings loan is repaid in full within the term.

The loan phase at a glance:

• Starts with the loan application
• Terms of the loan already specified at the time of conclusion of the contract
• Repayment is made in monthly installments
• As a rule, no residual debt remains outstanding

Advantages of building savings contracts: Security and promotion

Like any financing method, the building savings contract also has advantages and disadvantages. Building savings contracts offer a flexible combination of savings and security for the construction or purchase of a home. They are characterized by attractive interest rates, favorable loan conditions, tax advantages and deposit protection. In addition, a home savings contract can also be used as a hedge against unforeseen events.

The advantages summarized:

• Combination of savings and credit product
• Flexible repayment options
• Attractive interest rate and favorable loan conditions
• State support through premiums
• Safe variant of real estate financing

Disadvantages of building savings: High fees and long commitment

In addition to the advantages, there are also disadvantages, as with all financial products. Due to the necessary prior savings phase, home savings contracts are less suitable for immediate financing.

The disadvantages at a glance:

• Long commitment period
• Low liquidity
• Higher costs compared to other forms of savings
• No availability of building savings in emergencies
• No flexible repayment options

For whom is a building savings contract worthwhile?

A building savings contract is suitable not only for those who want to fulfill their dream of owning a property, but also property owners. In addition to construction or purchase, the loan can also be used for modernization or as a maintenance reserve.

When and for whom is a building savings contract useful?

• People who want to purchase real estate in the next few years
• Investors who want to use government subsidies to build up assets
• Home savings customers who expect interest rates to rise
• Real estate owners who value calculation security
• Home purchase financing supplement

If you belong to one of these groups, a building savings contract can be doubly worthwhile. Building savers are supported by the state and receive state subsidies under certain conditions. The subsidies include the housing subsidy, the employee allowance and Wohn-Riester.

Tip: Taking out a home savings contract is particularly worthwhile during periods of low interest rates.

Why finance?

Acquiring a property is an important decision, whether as a capital investment, a home of one’s own or as a private provision. With the different types of financing it is possible for everyone to make his first home or his first capital investment possible. Before you enter into a financing you should deal with some points before. You should check your equity, consider the incidental acquisition costs, calculate interest and repayment, housing allowance and reserves, and calculate your monthly burden.

Own home or real estate as an investment

Buying your first own apartment or house is a purely emotional decision, whereas in the case of real estate as a capital investment, it is purely a matter of the economic aspect and therefore an emotionless decision must be made. In both cases, however, it is important to deal with a checklist and the ancillary purchase costs in order to avoid serious mistakes.

Buy first apartment

Buying your first own apartment is a great experience in life. To ensure that nothing goes wrong when buying your first apartment, it’s best to have a checklist at hand!

• Buy first apartment
• Buying an apartment: Checklist

Purchase price + ancillary purchase costs / credit rating (rule of thumb: how much is left over in the month?)

Buying an apartment or house always involves additional costs! To be able to cover these, you should think in advance about how high the maximum purchase price may be and how much money is available per month.

• Maximum purchase price
• Incidental purchase costs

Types of financing

If a property is purchased, the purchase price is usually paid off with the help of real estate financing. For this purpose, the buyer can choose from various types of real estate financing. From annuity loans, partition loans, full financing, construction financing to many other types of financing.

But what does financing actually mean? It is a measure for the procurement and repayment of capital. But some forms of financing require security in the event of default, which must then be recorded as a mortgage or land charge in the land register.

Annuity loan: Probably the best-known form of financing

An annuity loan is a typical form of real estate financing. The fixed installments must be paid regularly and consist of an interest and repayment portion. The special feature of the loan is that the amount of the installment remains the same throughout the entire term, but the ratio of interest and repayment changes nevertheless. With each payment, the loan debt decreases and the interest portion thus decreases, but the repayment portion increases.

Who is this type of financing suitable for? For security-conscious investors who want to count on fixed rates over the fixed interest period.

The most important in a nutshell:

• Fixed rates
• Composition of interest & repayment portion
• Steady rate
• Change of the interest & redemption ratio

Advantages and disadvantages of the annuity loan

Probably the greatest advantage of this typical form of financing is the constant installment, which allows a fixed monthly budget to be planned precisely. It is also often possible to make unscheduled repayments at certain times and thus repay the loan more quickly. One of the disadvantages, however, is a long fixed interest rate, which means that you are tied to monthly installments for a longer period of time. If your personal situation changes and you want to repay earlier, you will have to pay a high full repayment penalty for the early repayment. After expiration of the debit interest rate commitment, follow-up financing is usually required; the interest rates are based on the current market investment, which can be either positive or negative.

Advantages:

• High planning reliability
• Fast redemption
• Decreasing interest burden
• Accurate calculation of follow-up financing
• Residual debt fixed from the beginning

Disadvantages:

• No change of contract possible
• Agreement of unscheduled repayments for flexibility
• Credit institutions do not always accept unscheduled repayments
• Borrower must assume full repayment penalty

Reverse mortgage: mortgaging the owner-occupied home

There are different forms of financing to finance the dream of owning a house or apartment. The reverse mortgage is one type of many financing options. It is a loan that is paid out by an insurance company, bank or private individual. The basic idea behind it is that property owners borrow against their home and in return receive a loan with a fixed term from a bank, insurance company or private individual. The loan amount is then transferred as a monthly annuity or a one-off payment. A real win-win situation: owners can stay in their home and even supplement their pension at the same time.

Who is the reverse mortgage suitable for? This form of financing is particularly worthwhile for older people who are already retired and no longer want to leave their home, but still want to supplement their pension.

• Disbursement of a loan by insurance company, bank or private person
• Mortgaging of the home
• In return receipt of a loan with a fixed term
• Paid out as a monthly pension or a one-time payment

Advantages and disadvantages reverse mortgage

Do you have little or no equity capital available for buying a house? Then the reverse mortgage is exactly the right form of financing for you. It is especially suitable for retirees who have paid off their property with savings and income all their lives. A special advantage is that owners can live in the property until the end of their life and receive money for their property during that time. The pension can thus be supplemented. Thus a high planning security is created, since the height of the annuity, interest rate and running time are specified in advance. Clear disadvantages of this form of financing are fees and the interest rate of the loan. There may also be closing fees if the average age is exceeded and the inheritance is significantly reduced.

Advantages:

• Lifetime right of residence
• Pension is improved
• No interest or redemption payment
• Heirs can redeem real estate

Disadvantages:

• High fee costs
• Low payout amounts
• Elimination of inheritance
• Maintenance of the property

Here you will see the verification of the equity and monthly income, in order to then be able to set up a type of financing:

Repayment loan: Decreasing installment burden during the term

An amortizing loan is a particular form of financing characterized by a decreasing installment burden over the term of the loan. The interest portion decreases from installment to installment, so that it constantly decreases and becomes more and more similar to the repayment amount. Wondering if the amortizing loan is right for you?

If you want to pay off your loan quickly and efficiently, then this form of financing is suitable for you. However, you should have a regular and solid income so that the high installments can be paid at the beginning.

• Decreasing rate burden over the term
• Constant reduction
• Fast & efficient redemption
• Regular, solid income should be available

Advantages and disadvantages of the amortizing loan

The amortizing loan brings with it advantages and disadvantages that should definitely be weighed up against each other before concluding a financing deal. A significant advantage is that the borrower pays off a fixed amount per month, thus reducing the residual debt. However, the fact that the residual debt remains relatively high at the beginning and only decreases sharply at the end of the term is a clear disadvantage.

Advantages:

• Faster reduction of residual debt & interest amounts
• Free capital can be used
• Landlord may use proceeds from rent for increased repayment of principal
• Low total cost of credit

Disadvantage:

• Residual debt high at the beginning
• Additional costs for early reduction of residual debt
• Loan form rarely accessible to private individuals
• Longer term in most cases

Building savings contract: Combination of loan & savings

Very simple! This is a combination of real estate loan and usual savings. First, it is determined how much should be saved per month, which then results in the building savings amount. The contract is divided into several phases. In the first phase, the saver pays in a fixed amount each month. He then receives interest on this amount.

The second phase begins when a certain amount has been saved, for example 35 percent of the total amount. Then comes the allocation. You receive the right to a building loan at a lower interest rate for the remaining amount. The building savings contract is suitable for people who want to finance their dream of owning their own property as cheaply as possible. However, this financing option is not intended for short-term financing goals.

• Combi of loan and savings
• Different phases
• Monthly fixed amount with interest
• Allocation starts from a saved amount
• Right to soft loan
• Long term financing

Advantages and disadvantages of a building savings contract

A building savings contract has advantages and disadvantages. You can read more about this type of financing here.

Advantages:

• High security
• Capital guarantee
• Profit through government subsidies
• Intended use flexible

Disadvantages:

• Interest on credit balances lower in the initial phase
• High processing fees
• Monthly charge higher than other financing

Full financing: With little capital to own a home

There is little or no capital available for a real estate purchase? There is no opportunity to save money or you have just started to do so? This is exactly when full financing comes into play. The credit institution then takes over the missing equity capital and finances if necessary also the building additional costs. But then you have to keep in mind that the interest rates are higher.

• Little to no capital available
• Credit institution assumes equity
• Financing of ancillary construction costs
• High interest

Advantages and disadvantages of full financing

A property can be financed also quite simply without own capital funds, that can bring advantages, but also disadvantages with itself. First of all, short waiting periods are guaranteed, because you do not have to save until a certain point in time, the dream of owning your own home can be fulfilled directly. In addition, it is always good to finance as early as possible, so that one is free of costs before retirement age. Another advantage is that possible savings can be used for repairs or new furniture. But what are the disadvantages? There is a risk that the repayment can cause problems due to possible changes. This can be, for example, unforeseen unemployment or even incorrect calculation. Another point is high interest rates.

• No long waiting time
• Earlier repayment of the loan
• Equity subject to change

Disadvantages:

• Higher interest rates
• Longer redemption period
• Unforeseen life changes

A number of staff review the current market rate and adjust it to current loans:

Variable loans: Flexibility through variable interest rates

This is a type of financing that is particularly suitable for short-term real estate financing. The good thing about this form of financing is that you do not have to pay fixed debit interest, because the interest rate is always adjusted to the current market interest rates. The interest rates are always based on the Euribor money market rate. But what do you mean by Euribor interest rate? Very simple. It is a key interest rate of the European Central Bank. The interest rates are adjusted every three to six months to the interest rates of the variable loan.

But for whom is this form of financing actually suitable? Clearly for buyers with a willingness to take risks. Likewise for buyers and builders for whom financial security is guaranteed.

• Short-term real estate financing
• No fixed debit interest
• Adjustment to current market interest rate
• Interest is adjusted to the loan every 3 – 6 months

Advantages and disadvantages variable loan

Are you interested in a variable loan? Then you should definitely weigh up the pros and cons beforehand. It is clear that this is a high-risk loan. An unexpected rise in interest rates not only leads to higher costs, but also increases the loan rate. However, the loan also comes with its advantages. If the interest rate level remains the same over time or even decreases, then you save on the real estate loan. In addition, the loan can be terminated with a notice period of 3 months. Alternatively, borrowers also have a right to make unscheduled repayments of up to 100% at any interest rate adjustment.

Advantages:

• At Euribor waste useful, interest rates more favorable
• High security
• Cancelable at any time

Disadvantage:

• Development of interest rates uncertain
• Interest rate fluctuation makes monthly costs unpredictable

Construction financing with a life insurance

Normally, a construction loan is combined with a capital policy. This means that the buyer pays interest only at regular intervals. The repayment of the loan follows with the disbursement of the loan.

Advantages and disadvantages construction financing

As with any financing, there are advantages and disadvantages to financing construction with life insurance. One significant advantage is that a home savings contract with life insurance is more favorable than an annuity loan and the loan is also secured in the event of death. One disadvantage is that the return is very low.

Advantages:

• More favorable than a normal annuity loan
• Credit protection in the event of death

Disadvantages:

• Low return

Connection and interim financing

These types of financing are referred to as financing that is usually only invested for a short period of time. Here you can learn more about the respective interim financing:

Follow-up financing: renegotiation of the loan

This form of financing is a renegotiation of an existing loan. If the previous construction or real estate financing has expired after the fixed-interest period, one must deal with the follow-up financing from this point at the latest. Many buyers take out a loan to fulfill their dream of owning their own property. The fixed interest period for a house financing goes between five and fifteen years. A multiplicity of borrowers do not create it however in this time span the loan back to pay. This is precisely when borrowers can agree on a new arrangement for repaying the remaining debt.

Interim financing: bridging bottlenecks

Interim financing is financing that only runs for a short period of time. This form of financing can be used to bridge financial bottlenecks for a certain period of time. The owners of a property can provide immediate financial resources and then use them as equity.

Refinancing: restructuring of the loan

What is actually meant by refinancing? It means an adjustment or restructuring of a loan. Whether you have a personal or business loan, you should definitely have that loan reviewed every few years to make sure you have the most favorable loan. For example, you may have taken out many small loans that can be combined into one.

Real Estate Financing Guidelines

Financing real estate made easy! We have compiled tips, tricks and the most important information on the subject of real estate financing for you, so that you too can realize your dream of owning your own home! Do’s and Don’ts, tips and experiences from experts will guide you and answer all your questions about “How to finance a property”. Become a professional and make no more mistakes in the future!

Real estate financing and purchase (external & free of charge)

Learn from the experts. You can find many, many more guide articles for free at Lukinski. Learn everything you need to know about buying real estate for free. Start in general with buying real estate, go over your specific type of real estate, from apartment, to house, apartment building to buying land. Also important: everything about the purchase contract (who pays the costs?), incidental purchase costs and saving taxes with real estate, through legal forms such as a real estate GmbH or family foundation. Here you can go directly to the topic: Real estate financing in comparison.

Tip! Overview Real Estate XXL

The world of real estate is complex and multifaceted. If you want to keep an overview and avoid making mistakes, you should prepare well and clarify as many open questions as possible in good time. No matter whether you want to build, buy and rent out a property or live in it yourself, or even use a property as an investment to generate passive income: The preparation is the A&O. Here you will find articles, as well as book and video tips with successful and helpful books and videos on the subject of real estate – including tips and tricks from professionals and experts.

• Book & Video Tips Overview: Real Estate

Real estate financing: the right strategy for capital investors

Rating: 4.5 from 5.0 (53 ratings)

The secure way to tailor-made financing: For owner-occupiers of a property, it is all about the favourable financing of the property. For capital investors, it’s about the best possible financing conditions for the rented property. With this pocket book you will find out which financing plan is suitable for you. The guidebook answers all the important questions about money for a house or apartment, whether for the initial financing, a modernization or follow-up financing.

• Income and equity ratio: how much house can you afford?
• Interest rate strategies: How long are you tying yourself down for, and which lender has the lowest mortgage rates?
• Repayment Strategies: As an owner-occupier or landlord, what repayment percentage is best for you to choose?
• Financial aid: How do you use money from the KfW and Wohn-Riester when financing your own home?
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Real estate financing without equity

Rating: 4.3 from 5.0 (40 ratings)

In this guide, you will learn how you can fulfill your dream of home ownership, even if you do not have any equity today. Do not hesitate and deal with the topic of home ownership today. Even if you think real estate is expensive, it won’t get any cheaper in the medium term. The longer you pay rent, the more expensive it will be for you in the end.

Why should you look into buying an owner-occupied property right now?

• Interest rates are at an extremely low level, making financing very favorable
• Real estate, like all tangible assets, is protected against inflation.
• Very often the monthly charge as a tenant is higher than paying off your loan
• Real estate is the ideal retirement provision
• You actively build up your assets through monthly repayments

Also learn in this book

• How to be perfectly prepared for bank interviews
• How to improve your Schufa score
• What grants you may be able to apply for
• Why a granny flat will make you debt free sooner
• How you can get equity from relatives without them having to give you a single euro
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Practical guide to real estate acquisition and financing

Rating: 4.4 from 5.0 (45 ratings)

The practical guide is written for all those who want to buy or build their own (credit-financed) property in Germany. The author presents the topic in a clear and easy-to-understand manner, introducing both legal and economic issues in a concise and detailed manner. The contents are illustrated by examples with concrete calculations and references to the current legal situation. The calculation tool helps to determine the actual costs of loan financing.

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Real estate practice manual for owner-occupiers

Rating: 4.8 from 5.0 (27 ratings)

Buying, building and financing your own home are long-term and far-reaching decisions. In this guide, you’ll find comprehensive information and checklists for buying a used property and building a new one on your own. As a bonus, an Excel calculator tool for real estate loans is available. With this guide, you will be able to organize the purchase and financing well and avoid expensive mistakes.

From the contents:

• Purchase of a second-hand property
• Buying a new property from a developer
• Purchase of a plot of land & construction on own account
• Special features when buying a condominium
• Purchase in the compulsory auction
• Strategies for intelligent financing with loans & equity
• State subsidies for home ownership (e.g. Wohn-Riester)
• Calculation tool for loan financing
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Real estate financing for owner-occupiers

Rating: 4.6 from 5.0 (54 ratings)

Real estate is still considered a solid investment. Interest rates are low, prices vary greatly from region to region. And the small print in banks’ loan agreements is becoming increasingly complex. To see through the pitfalls of buying a house, you need expertise. This book will help you develop it: in estimating the purchase price, in structuring the sales contract, and in financing. In the end, you’ll negotiate smartly and on equal footing with sellers, realtors, and banks to get the best outcome for your family.

“This is by far the best book on financing your own four walls that I have read. Anyone who reads this book and heeds its advice is sure to save a lot of money and, most importantly, avoid unnecessary risks. Anyone who thinks they don’t need this book has only themselves to blame.”
Dr. Rainer Zitelmann, real estate investor, founder of the consulting firm Dr. ZitelmannPB. GmbH

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Real estate financing: Understanding banks

Rating: 4.3 from 5.0 (26 ratings)

What is the best way to prepare for a real estate purchase? What do you need to consider when financing? There are many books and financial magazines on this topic, but this guide is different. With this book you get a practical guide to the topic of real estate financing. In an entertaining and reader-friendly way, the author succeeds in explaining the pitfalls of real estate financing in a simple and understandable way. With the help of many practical examples, Dirk Nopp clarifies even the most difficult topics and explains technical terms in such a way that even laymen understand them.

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Construction financing guide

Rating: 4.6 from 5.0 (4 Reviews)

This book helps with the important question of financing:

• How do I draw up a budget?
• How do I calculate the monthly charge?
• What additional costs should I expect?
• How much real estate can I afford?
• After how many years will I be debt free?
• What financing options and loans are available?
• What do all the financial terms mean?
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Construction financing: The best way to a house or condominium

Rating: 4.2 from 5.0 (7 ratings)

The foundation stone for your own four walls!

Important building block for old-age provision, independence from landlords – owning a property offers a number of advantages. That’s why many people dream of owning their own house or condominium. To ensure that the dream does not turn into a nightmare, the financing must be on a solid footing – because the decision to buy usually means an economic burden that lasts for decades.

This guidebook supports you on your (financing) way to your own property Well structured and understandable, it answers, among other things, the questions:

• How do I calculate the cost of purchase or construction?
• How do I determine my financial resilience?
• Which type of construction financing is most favorable for me?
• How can I benefit from the Wohn-Riester subsidy?
• With many tips, examples, checklists and the “ABC of construction financing”.
• Buy at Amazon

Related links about the topic Real estate

The real estate financing is now covered quite extensively for you, but you are still looking for more literature on the topics of renting property, real estate agents or passive income? Here you will find more book tips for you.

Let property

Renting out property is a great way to provide for your retirement and stop worrying financially. There is a lot of money to be made in real estate – how it all works is explained in these books so you don’t make any mistakes!

• Video Tips: Rent out property
• Book recommendations: Renting a property

Real estate agent

Earning money with real estate is a lifelong dream for many. Marketing and selling luxurious homes in the most beautiful cities in the world. That’s the image that comes to mind when we think of real estate agents. We want to show you the way to get there and give you a jump start. We offer you a list of the best book recommendations with tips and tricks from the experts: everything from training books, job aids with forms, and guides with how-to’s on getting started in real estate. Our guides to success in the real estate industry

• Video Tips: Real Estate Agent
• Book Recommendations: Real Estate Agent

Passive income through real estate

Passive income – Some people are considering it, or have already done it: buy a property and rent it out. By doing so, they hope to generate passive income. You can find information on the subject in these book tips.

• Video Tips: Passive income
• Book recommendations: Passive Income

Overview real estate XXL: Investment, broker, renting & Co.

Here you get back to the overview of book and video recommendations on the subject of real estate in Germany. Investment cases, capital investment, passive income, house or apartment buy and rent and much more is explained to you here by experts and understandable. In this XXL guide you will find information and articles on the most diverse questions on the subject of real estate.

• Back to Book & Video Tips Overview: Real Estate

Real Estate Financing Guidelines

Financing real estate made easy! We have compiled tips, tricks and the most important information on the subject of real estate financing for you, so that you too can realize your dream of owning your own home! Do’s and Don’ts and tips and experiences from experts will guide you and answer all your questions about “How do I finance (m)a property”.

Real estate financing and purchase (external & free of charge)

Learn from the experts. You can find many, many more guide articles for free at Lukinski. Learn everything you need to know about buying real estate for free. Start in general with buying real estate, go over your specific type of real estate, from apartment, to house, apartment building to buying land. Also important: everything about the purchase contract (who pays the costs?), incidental purchase costs and saving taxes with real estate. through legal forms such as a real estate GmbH or family foundation. Here you come directly to the topic: Real estate financing in comparison.

Tip! Overview Real Estate XXL

The world of real estate is complex and multifaceted. If you want to keep an overview and avoid making mistakes, you should prepare well and clarify as many open questions as possible in good time. No matter whether you want to build, buy and rent out a property or live in it yourself, or even use a property as an investment to generate passive income: The preparation is the A&O. Here you will find articles, as well as book and video tips with successful and helpful books and videos on the subject of real estate – including tips and tricks from professionals and experts.

• Book & Video Tips Overview: Real Estate

Common mistakes: tips for doing better

Many people who want to finance their property make the same mistakes over and over again. What these are and how you can avoid them is explained to you in the following videos by experts. In these videos, you will learn how to strategically approach your real estate financing in the best possible way and how to optimally save money! In addition, you will learn what you should definitely consider when financing your property.

5 mistakes in construction financing

This video is about the 5 biggest mistakes in home financing. You should definitely watch the video if you are about to make your first purchase. With small tips you can often save a lot of money. This in turn determines in the end whether a property is really worth it.

Construction financing: What you should pay attention to

Here you will learn what you should pay attention to when financing a property. Equity, repayment and interest: Here you will find an explanation of how these parameters are put together for optimal real estate financing.

Building savings contract for real estate financing: Mistakes

Home loan financing – Poorly planned home loans can ruin families. What the consequences of a badly planned financing or a building society contract are, is explained in this video. You will also learn how you can avoid this yourself.

Real estate financing without equity

You want to finance a property because it is your dream or the circumstances are currently perfect, but you don’t have enough equity to finance it? No problem! That’s how some investors feel, but that shouldn’t stop you. In these videos, you’ll learn how – even without providing any equity – you can finance your property without going into debt.

Financing real estate with little or no equity

How do you finance a property with little equity? Is that possible at all? What is legal, what is not? What does the bank say if I have little equity? What are the misconceptions about particularly cheap properties? This and more on the subject of equity you will learn in this video.

Financing real estate without equity

In this video, we talk about construction financing issues, such as real estate financing without equity. Especially the real estate financing is one of the most important building blocks in the long-term real estate economic success, here insider knowledge is very valuable.

Equity finance

Financing a property with equity is probably the most common way of financing a property. How this works, how much money you should actually take in hand and what you should absolutely consider, you will learn here. In addition, different options are presented to you in order to find and develop the financing strategy that is perfectly suited to you.

Equity share in real estate financing

How much money do you need to buy a property? This video explains how much equity is needed for a property, what forms of financing there are and why it makes sense to use as little equity as possible for the real estate investment.

Equity: How much do you need to have and how much should you put in?

Every one of us wonders: How much equity should I use for my property? In this video you will learn the basics of real estate financing. To be able to calculate equity, it is important to know what all equity is. This and other explanations you will find in this video.

Private real estate financing

Financing a property as a private person is possible, but not a simple matter. In this video you will learn how private financing of real estate works and what you should pay attention to. The whole thing is explained with everyday examples to make the information as accessible as possible.

How does private real estate financing work?

This video explains how traditional private real estate financing works. Based on simple everyday examples, the most important basic elements of financing are clearly conveyed.

Optimal redemption

Taking out a loan or credit to finance a property is a common method. In these videos you will learn more about real estate financing, interest rates, loan rates and the optimal repayment, With these tips you will also find the perfect loan to buy your next property without a guilty conscience.

Financing real estate: How much you should repay?

The real estate loan or real estate financing has a huge impact on whether a property works as an investment or a home works as an investment. Financing a property is therefore something you should definitely understand before buying. One important question to ask is how much to amortize or what is the optimal amount of amortization. This video explains whether you should pay off a lot / pay off quickly or pay off a little / pay off slowly and what role your personal situation plays in this. You will also learn how you can make clever use of unscheduled repayments and what repayments we have agreed on for our own apartments.

Construction financing: Purchase price, rate, interest & Co.: How much house can I afford?

In this video, you’ll learn what your own property may cost, how to determine the right loan rate, and how to get the best interest rate on your financing.

Bank interview – What documents do I need?

To finance your property, you may need a loan or credit. You can usually only get this through a personal interview at a bank branch. In this video you will learn which documents you need for your bank interview and how you can appear most serious and well prepared to emerge from the interview as successful as possible.

What documents you need for a bank interview

This video explains which documents you should bring with you for your bank interview for real estate financing in order to be optimally prepared. You will also learn what is really important for the perfect appearance.

Related links about the topic Real estate

Want to learn even more about buying, financing, renting, or real estate agents? Then check out our other video tips and tricks on these topics to become a real estate pro!

Build property

To build or to buy a house? This question is on the minds of many prospective buyers. In this article, we show you the advantages and disadvantages of both options and offer interesting tips on financing. Both options have their advantages. A new building has the great advantage that you can determine the layout of the rooms according to your wishes. In an existing property, you no longer have to deal with the complicated construction phases and you can live in your own home much faster. Here you will find videos that will help you finance your dream home and explain to you what you should pay attention to.

• Video Tips: Build property
• Book Recommendations: Building real estate

Buy and rent real estate

Buying and renting real estate – It’s hard to get started, but with the right recommendations and tips, it’s easy. So that you too can make a smooth start in the world of real estate, we provide you with tips and tricks. Everything from how to prepare to buy your first home, to finding the right rent, to solving problems like rent default and vacancy. This guide provides you with the best videos from the field of buying and renting real estate.

• Video Tips: Buy and rent real estate
• Book Recommendations: Buying and renting real estate

Overview Real Estate XXL: Investment & Co.

Here you get back to the overview of book and video recommendations on the subject of real estate in Germany. Investment cases, capital investment, passive income, house or apartment buy and rent and much more is explained to you here by experts and understandable. In this XXL guide you will find information and articles on the most diverse questions on the subject of real estate.

• Back to Book & Video Tips Overview: Real Estate

Types of investment and alternatives

Where can 1,000 to 100,000 dollar be invested to get the top results? There are many different ways in which savers can invest their money. Which forms of investment are suitable for short, medium and long-term investment? There are many more questions! What does investment in real estate mean? How do you calculate the return on a property? What is a safe investment? Is real estate a good investment? We start with the simplest forms: Saving money. Later we also come to topics such as cars, safe investments like real estate and speculative investments like art.

Investment Portfolio: Asset diversification

Anyone who has learned from the past, from economic crises to currency fluctuations and inflation, should diversify their capital in such a way that even in uncertain times, a certain degree of freedom and mobility is maintained, that is:

• 1/3 Fixed-income assets/securities
• 1/3 Real estate
• 1/3 Mobile material assets, e.g. diamonds

Savings book – The classic

The savings book offers, especially for young people, a good start through the mental obligation to regularly deposit money. The big disadvantage is that interest rates are currently low, even close to zero.

The classic savings book is suitable for continuous asset accumulation. You regularly pay your monthly savings contribution, for example through your salary. Often the account management is free of charge and every dollar deposited earns interest, albeit small

A savings account is easy to set up for just about everyone. With the way to the bank or the on-line mechanism over a direct bank, for each saver possible, flexible availability of the capital very small capital yields very low nearly none. The yield of savings books is very low and therefore there is almost no risk. Savings books are easy to set up, possible for every saver, flexible availability of capital. But there are also disadvantages of passbooks such as very low returns on investment.

Facts about the passbook

The 3 most important facts about the savings book:

• possibility to invest the first capital stock
• no (extremely low) default risk
• available for everyone

The savings book offers a secure investment and is a good option, without risk, especially for people who want to build up their first small capital stock.

Read more about the simplest form of investment, the passbook.

Fixed-term money – binding term and yield

Money that you do not need to access for the next 1 to 3 years can be invested in a term deposit account. The longer the term, the higher the interest.

Fixed-term deposits offer the advantage of easy set-up, stable interest rates and various maturities are selectable early termination is often not possible, termination is only possible for a fee. The risk assessment of fixed-term deposits is therefore low compared to the investment alternatives. However, the current yield of fixed-term deposits is just as low due to the current interest rate situation as is the risk – a trade-off that every saver must weigh up for himself. Therefore, just like a savings book, a fixed-term deposit is easy to set up, it offers stable interest rates and you can choose different maturities. Conclusion: Many advantages, little return.

Facts about the time deposit

The 3 most important facts about time deposits:

• For capital that is not essential needed
• Obligatory term (previous exit only with losses)
• Fixed return after time

Overall, fixed-term deposits are suitable for people who can do without part of their capital for a certain period of time. This is invested with a fixed term, in return for which you receive a fixed return.

Binding term and yield, read more about saving with a fixed-term deposit

For those who want to calculate their possible interest payments themselves, there are very simple formulas available for calculation. The two most important are these:

Interest per year:

Interest per year = (investment capital x interest rate) / 100

Interest per day:

Interest for t days = (investment capital x interest rate x t) / (100 x days per year)

Daily allowance – flexibility and security

Overnight money is absolutely easy to set up, often the offer is included ready in the opening of the account. Your deposited capital is available at any time, unlike investing in a fixed-term deposit account with a binding term. For the start with overnight money you need only a small investment income or income.

Due to the current interest rate development, as will be seen later in the statistics, the increase of capital via overnight money is only worthwhile from very large amounts of money. In return, you have a very low, almost no risk in your capital investment. The current return on overnight money is very low as described, which is little to no risk, but you will hardly make any profit. Overnight money is like time deposits and savings books easy to set up in many bank branches and of course online. Your capital is always available.

Facts about the overnight money

The 3 most important facts about the daily allowance:

1. Available for everyone
2. Constant availability of your money
3. Low return

Overnight money is a flexible reserve option for small savers. You can fall back on your money at any time, but the returns are more moderate than with a time deposit.

Current interest rates and more: call money.

Overnight money comparison: Interest rate development from 120+ banks

The basis of the interest rate statistics are currently 12 tested overnight deposit accounts, which you will also find in all overnight deposit comparisons.

• 2008 by 4.15%
• 2010 by 1.12
• 2012 by 1.22%
• 2014 by 0.39%
• 2016 by 0.12%
• 2018 by -0.03%
• 2020 by -0.08%

Deposits rise despite falling interest rates

How do interest rate developments relate to the amount of deposits? As we have already noted with regard to the savings book, this is mainly due to the scepticism of savers, towards the stock market and the economy.

In general, one should be able to assume that the current fall in interest rates, which is dependent on the interest rate situation, will lead to a corresponding fall in interest among savers.

However, as the chart shows, this is not necessarily the case, as a glance at the infographics below shows. In the chart you can see how the interest rates on overnight deposit accounts have been falling steadily since the beginning of 2012, but the amount of deposits of private households with daily maturity almost always increases.

More facts and figures about overnight money.

Direct comparison – savings book, overnight and time deposits

Building society contracts – house purchase, construction and conversion

When you save with a building society, you benefit from various support options such as premiums from the state. You can use your bauspar contract for the construction, purchase or conversion of a house. However, a bauspar contract is also interesting for real estate owners, for example to finance modernization measures. The respective costs depend strongly on the provider. Read more about bauspar saving here.

Procedure and phases – The strengths of a building society contract lie in its fixed planning capability. A bauspar contract consists of two phases, the saving and the saving phase. With a bauspar contract you first save about half of the planned bauspar sum (see bauspar calculator), the other half is then available as a loan at a fixed interest rate.

As already described, there are many questions, ranging from what is the savings phase and how long is the term of a savings agreement to what is meant by a savings agreement? But the advantages and disadvantages are also important for many people who want to start saving. What are the advantages of a bauspar contract?

No equity capital necessary – the highlight of every bauspar contract is that it can be used without any equity capital at all. It can be set up anywhere, locally in branches but also online in comparison portals.

The disadvantage, the payout is bound to strict regulations, the risk of default is extremely low, especially with old contracts. Did you already know? It is possible to convert building society contracts into capital investments by paying premiums – but this advantage is usually limited to the old contracts just mentioned. Unfortunately, such contracts are hardly offered anymore with the current interest rate situation. The current yield of bauspar contracts is average.

Facts on building saving

The most important 3 facts about the building society contract:

1. No equity capital required
2. Support through premiums from the State
3. Earmarked (according to strict regulations) for house construction, purchase and reconstruction

Building society savings really pays off for everyone. The conclusion is simple, the plan has a clear goal. No matter whether it is rent-free living or old-age provision, building saving is a real must in order to build up equity.

Read more about bausparing here.

Real estate – capital investment and retirement provision

The great advantage of real estate as a capital investment is its long-term value and, in addition, the corresponding increase in value in a good location. If you are looking for an exclusive property, you do not need a normal broker but a luxury realtor with specific knowledge and a good network. Many of these objects will never appear in the usual real estate portals.

Another advantage in the current interest rate situation, the investment of capital is possible through cheap loans with favorable financing – according to the motto, if not now, then when? Of course, there is also the option of tax advantages, but these should be discussed and planned with an experienced real estate agent or tax consultant. Read more about capital investment real estate here.

Real estate overview: Risk assessment

The most popular are

• Plots of land
• Condominiums
• Private homes
• Pure and semi-detached houses
• Retirement home

The risks and disadvantages include the complex effort involved in buying and selling real estate. From collecting the documents to the viewing appointments and the negotiation phase or the purchase contract.

The increase in value is strongly dependent on the location, as describe.  In addition, as a property owner you will have responsibilities as a home owner and property manager if you do not outsource the service to a company. To get started in real estate, you usually need a lot of equity, depending on various factors.

The return on property is average, with a high tendency for good properties in attractive locations. The local increase in value of any property, whether it is a condominium or a home of your own, depends strongly on the location. Prices literally explode in cities like Munich and Hamburg. The risk as well as the return on real estate is medium to high, depending on the various factors mentioned. Real estate offers long-term value, which is its great advantage, also for investors who are thinking about retirement provisions.

Facts about real estate

The 3 most important facts about real estate as an investment:

1. Requires a lot of equity from the saver
2. Long-term capital commitment
3. Requires know how when buying (object, location, etc.)

Real estate is advisable for laymen, like stocks, at the first purchase only with the help of experts (e.g. real estate agents). It is a long way from the first research to the inspection and the purchase contract as well as the subsequent property management.

Read more about capital investment real estate.

The question as to which capital investment is the most lucrative cannot be answered in a blanket way. Depending on the amount of investment and personal goals, the search for the best capital investment is more or less difficult. The fact is, however, that the right investment with a suitable return brings with it a worthwhile increase in value and has many advantages for the investor.

Procedure and selection process

This is how you buy real estate:

1. Keep a cool head when buying property and don’t let personal feelings guide you.
2. Always let him show you a sample calculation of the yield of the property and question the assumptions.
3. Compare the return on your property purchase with that of other investments.
4. 4Take advantage of the competition among the providers of construction financing.

Invest money in real estate

Real estate as a capital investment becomes very attractive for many investors, especially at the current low interest rates, and offers many advantages for long-term investment and value enhancement. We give you the most important tips:

1. Key figures
2. Land as an investment
3. Semi-detached houses and apartment buildings
4. Buyer tips

And much more you can find now in the article “Real estate as a capital investment?

Equities – risk and return

Access to shares is easy for everyone, online or in the bank branch. Every bank offers such accounts, some also charge custodian fees. Read more about buying and selling shares here.

For laymen there is always a risk, because the trade is confusing. Stock market tickers, news, tweets, many things influence prices and developments. The (daily) trading with shares requires competence and experience. In case of speculations, high losses are possible immediately. This means that the risk, but also the loss in case of doubt, is medium to high. If you want to start trading more safely, you should use ETFs. Where there is shadow, there is sun. For example, the returns on shares are just as medium to high compared to traditional investments such as savings books, time deposits or overnight money. You can read more about this in our articles on equities and index funds (ETF).

Facts on shares

The 3 most important facts about shares as a capital investment:

1. Know how required
2. High risk (even complete failure possible)
3. Purchase fees must be taken into account in the volume

Equities offer great returns, as we also show in the dividend payout in the example on our article. It is only important that you take a close look at shares before you make your first purchase. We tell you what you need to consider in the first steps.

Read more about buying and selling shares here.

Is it worthwhile buying shares?

Anyone who holds shares for a longer period of time will receive dividends at the end of the financial year, if they are successful.

271.1 % Increase in dividends in 15 years

In this diagram, you can see very impressively how dividends are rising year after year, billion after billion. This is the development of the dividend payments of DAX companies in the years from 2003 to 2019 (in billions of dollars). The leap from 2004 to 2019 alone, i.e. 15 years, resulted in an additional annual payout of 27.8 billion dollars. This represents an increase of 271.15 % over the previous year.

Read more here and look at the statistics that show the extreme rise in profits in the stock market: Stock trading.

Funds (ETF) – Less risk and return

ETFs are bundled shares, which reduces the risk (default, profit and loss peaks). The A&O in the balancing process. ETFs are linked to fixed terms. Read more about safe investment in funds here.

Funds, like shares, must be set up at every bank. Different investment portfolios are possible and thus a corresponding gradation according to the risk appetite of the individual investor is possible. Of course everyone knows the tax advantages that are possible with capital transactions. Due to the large selection of fund products you can spread the risk well.

Each purchase and the fund management costs fees. Your capital is tied up for the long term, dissolution is only possible with loss before the end of the term.

The current return of funds is medium (compared to the investment alternatives) and the risk of funds is absolutely manageable.

Facts about funds

The 3 most important facts about funds as capital investment:

1. Binding maturity (earlier exit associated with losses)
2. Minimized risk through bundled individual values
3. Purchase fees must be taken into account in the volume

For those who can save money, funds are an excellent alternative to individual shares. Bundled funds are less sensitive as they contain many players that are more stable overall. Returns are correspondingly more moderate than for equities, but as you can quickly see in our best practice of dividends, it is worth investing in. In the last 15 years alone, dividends have tripled, from 2004 to 2019, which is 15 years, bringing an additional annual payout of 27.8 billion dollars. An increase of 271.15 % over the previous year.

Read more about safe investment in funds here.

Shares & Funds – Tips for your first purchase

If you are interested in buying an ETF, you will find many different pricing models on the internet. Here the individual prices per trade depend on the online broker. The standard fees are usually five to eight, maximum ten dollars. There is also a fee of 0.25%, depending on the amount traded. The fee per purchase is typically limited to an upper maximum amount.

First purchase: 100, 1,000 or 10,000 dollars ?

Another unbeatable advantage in fund trading, even with small investment amounts you can get in. When investing in real estate, you have to present 10% – 20% equity capital to the bank, which in large cities such as Hamburg, Berlin, Munich and Cologne can quickly amount to 50,000 – 100,000 Dollars. Investing in equity funds is often worthwhile at only 10% of the sum, about 5,000 – 10,000 dollars per package.

Why should you not buy smaller packages? There is an order fee for each trade. If you buy a package for 100 Dollars, many banks charge an order fee of 5-8 Dollars directly. Accordingly, your portfolio will shrink directly to 92-95 Dollars. This means that you have already made the first 5-8 Dollar loss, which a corresponding rise in the price of the fund must first offset. That means, directly at the purchase 5% – 8%

Loss of value.

Purchase of 100 Dollar Ø 6.5% loss
plus 0.25% trading fee

If you buy a package of 1.000 Dollar, the trading fee of our exemplary 5-8 Dollar is already much less important. With a purchase of 1.000 Dollar you keep 992-995 Dollar in value. Accordingly, the loss in value is reduced to only 0.5% – 0.8%.

Purchase of 1.000 Dollar Ø 0.65% loss
plus 0.25% trading fee

With a package of 10,000 dollars and an order fee of 5-8 dollars, the loss in value is directly reduced to 0.05% – 0.08%.

Purchase of 10,000 Dollar Ø 0.07% loss
plus 0.25% trading fee

Therefore it is worthwhile to buy larger packages directly.

In addition, there is the previously mentioned purchase fee of about 0.25% of the traded package.

Of course, the administration fee for your portfolio is just as favourable. The more value you hold, the smaller the effect on your portfolio.

You can find more interesting facts here:

• Stocks
• Funds

Bonds – yield and rating

Government bonds, or treasury bonds, are usually available in the local currency. In contrast to treasury bills (2 years), German Government securities have a relatively long maturity. This maturity is for example 10 or even 30 years. Read more about government bonds as capital investments here.

So when you buy a government bond, you are an investor lending money to the state. This bond is granted for a fixed period of time. In return, you as a lender receive a fixed interest rate, so-called coupons. The nominal value of a bond usually remains the same over the entire period.

Facts on government bonds

The 3 most important facts about government bonds as a capital investment:

1. Government bonds are used to finance government spending, so you lend money to the government when you buy bonds
2. Government bonds pay a fixed interest rate annually to the investor, the so-called coupon
3. The interest rate and price of the government bond issued is based, for example, on the current creditworthiness of the issuing country.

Government bonds are a safe bank for money. Whoever deals with the current inflation sees quickly, government bonds currently bring no returns.

Read more about the topic Government Bond here

Yield with 10-year maturity

Yield on ten-year government bonds of selected countries worldwide in October 2019.

Positive interest income

1. USA with 1.7
2. Greece with 1.34
3. Italy with 0,92 %.
4. Spain with 0,22 %.
5. Portugal with 0,19
6. Ireland with 0.02

Negative interest income

1. Germany with – 0.45
2. Luxembourg with -0.39
3. Netherlands with -0.3 1%
4. Austria with -0.2
5. Finland with -0.2
6. Japan with -0.16
7. France with -0.14
8. Belgium with -0.14%

Precious metals – gold, silver, platinum & palladium

Gold, silver, platinum & palladium and the current price – here you will find everything about precious metals as an investment. Gold in particular is regarded as the investment form during and outside of crises. Did you already know? The purchase of investment gold is exempt from VAT. Current prices, tips and more on the subject under precious metals as a capital investment.

Precious metals can be used as an investment form by the investor without much know-how (an exception is silver).

In contrast to investments such as vintage cars or art, a concrete value is tangible and is determined daily on the world’s stock exchanges. Investors only have to follow the current share price. But be careful: high fluctuations in the price of gold (and other precious metals) are also possible here, so the risk is medium to high (for example with silver).

The return is medium, depending on the price development. The yield of precious metals is medium to high, depending on the price development, as is the risk of precious metals. Precious metals are an attractive form of investment worldwide. It can be used at short notice, without great know-how. Through stock exchanges and trading, concrete values are always within reach. You as investor only have to follow the share price. Of course there are also risks with precious metals as well as the generally high fluctuations, as known from the gold price.

Facts on precious metals

The 3 most important facts about precious metals as a capital investment:

1. Gold is mainly bought in times of crisis, so the price development is often contrary to the stock prices (accordingly predictable)
2. Platinum is particularly rare and valuable (as seen in cars as an investment or in art as an investment, rarity is a top indicator), accordingly palladium is such an interesting substitute
3. Palladium is very interesting because it can replace platinum in the industry

The big advantage of precious metal is that you can always follow the current prices and thus have a solid assessment of value and appreciation (when looking at the current prices and also history)

Current prices, tips and more about gold, silver, platinum and co. under precious metals as a capital investment.

Diamonds – Valuation & Certificate

Diamonds offer protection against inflation, bank failures, stock market crashes and currency reforms. Not only that, anonymity also plays a major role for many investors. There is no registration of the investor for diamonds, no state access. Diamonds are not only anonymously obtainable for buyers, they also offer the unbeatable advantage that they are easily convertible worldwide. Safe or not? Diamonds as a capital investment.

Cartier jewelry (even the finest particles are used):

Did you know? Diamonds are the only internationally recognized substitute currency that is valued equally in all countries.

Every diamond is unique. They can be the same size, but have extremely different values. The quality is measured by the 4C of diamonds. This means that differences are formulated by “Carat, Color, Clarity and Cut”. They determine the quality and value of the diamond. As soon as you decide to actually buy diamonds, the tax-free increase in value also plays a role (take a look at our statistics on increase in value later). The tangible asset without maintenance costs is free of maintenance costs, provided that safekeeping is solved.

Facts on precious metals

The 3 most important facts about precious metals as a capital investment:

1. Protection (inflation, bank failures, stock market crashes and currency reforms)
2. Anonymity of the buyer
3. Global convertibility

Diamonds are an excellent choice as part of your own portfolio. As we have already described in the introduction of the article, a good portfolio should consist of one third each of fixed-interest investments or securities, real estate and mobile tangible assets, such as art, designer fashion or even diamonds.

Safe or not? Diamonds as a capital investment.

Jewellery – value investment

Jewellery is extremely different. On the one hand, there is the well-known costume jewelry from the city centers and from online mail order companies. Even at the beach promenade around in the supermarket there is costume jewelry to buy. On the other hand there are special and exclusive pieces from brands like Cartier, Chaumet, Bvlgari, Patek Philippe, Rolex and Tiffany. Read more about jewellery as an investment.

The rarer a piece is, the more expensive it can become. High-quality jewellery should only be bought from renowned jewellers. If in doubt, you should commission a value appraisal before buying the desired pieces. But under what circumstances is it worth investing in jewellery?

Facts about jewellery

The 3 most important facts about jewellery as an investment:

1. Equity capital required (entry 5 to 6 digits)
2. Moderate, long-term return (stable to slightly rising) / commitment if desired
3. Anonymous purchase and trade

With such high purchase sums, which as described also quickly reach a 6-digit value, jewelry is an investment for wealthy people and heirs. For the private, smaller investor the later resale is not easy and in most cases it is loss-making.

Read here further to the capital investment jewellery

Jewellery brands: Ranking

1. Cartier
2. Van Cleef & Arpels
3. Boucheron
4. Harry Winston
5.  Chaumet
6. Kloybateri
7. … the top 10 luxury jewelry brands

Art – Durable system without fixed sales value

Access to the established art market is possible for newcomers via galeries or auctions. For buyers with capital, art is certainly attractive as an investment.

It is risky that art has no fixed values and therefore no clear prospects of profit. Buyers must also have appropriate storage facilities. The risk is correspondingly high. Today’s return on art is high, if asked for, in keeping with the high risk of art as an investment.

Art is readily traded. The entry into the art trade takes time, art is therefore not a short-term investment. You can access the established art market through galeries and art auctions, for example, in which you can participate with prior registration. Whoever bids, the weather is also a little bit. Accordingly, there are no clear profit prospects in the art trade, especially at auctions. Security also plays a role, as buyers must have appropriate safe storage facilities when storing art objects.

Read more about art as a capital investment.

The most expensive works of art in the world

1. Leonardo da Vinci – Salvator Mundi for US$ 450.3 million
2. Pablo Picasso – Les femmes d’Alger for $179.4 million
3. Modigliani – Nu couché for 170.4 million US-$

Read on under Art as Investment.

Procedure: 3 tips for finding objects

1. Choose an art form that is interesting for you such as painting, photography, graphics, design
2. Search for special unique copies and / or objects, which were only produced in small numbers
3. Finally comes the choice of the right strategy, you speculate on known artists, unknown artists

Designer fashion – shoes, jackets and bags

Designer fashion as a capital investment? Shoes, jackets and expensive bags, high fashion is not only conquering the world’s metropolises, but more and more investors are turning to designer pieces. Haute couture is at the top of the list in New York, Dubai and Beijing. The leading luxury brands earn billions. We take a look at the most popular high fashion designers and potential investment objects. Read more about fashion as an investment.

The big advantage of designer fashion: fashion from designer labels can be bought by every consumer in a boutique simply and easily. It gets even better, if required it offers practical benefits for the buyer. However, those who buy bags & Co. from Hermés, Prade, Versace & Co. are less interested in practical use than in increasing value. The purchase and transport is anonymous, no buyer is registered.

Facts about designer fashion

The 3 most important facts about fashion as an investment:

1. Availability for everyone
2. Anonymity at purchase
3. Risk of loss of value due to trends, news or influencers

On average, humanity is becoming increasingly wealthy. Especially countries like China and India want more and more luxury goods. So the prices for special pieces are rising. Expensive handbags, fine dresses and shoes are making high profits.

Read more about designer fashion as a capital investment here.

Luxury brands: Ranking

Tip! The 10 most expensive handbags in the world. Read more about the top 10 luxury fashion brands here.

1. Hermes
2. Chanel
3. Louis Vuitton
4. Christian Dior
5. Ferragamo
6. Versace
7. …

In addition to the three basic rules of rarity, original condition and patience counts, the increase in value must exceed the running costs of the value investment car. Sports cars, youngtimers and oldtimers can be easily purchased and acquired by everyone via the used car market, so getting started is easy. However, it is extremely important that specialist knowledge is available. Experience in the field is absolutely necessary, for laymen completely unsuitable and also in the risk medium to high, without knowledge. Read more about cars and classic cars here.

The return on cars is medium to high, if the increase in value is given by following the 3 rules for car buyers. Where there are high profits, there is always risk, with cars as a capital investment the risk is high and investments should be made accordingly with planning. Cars are especially for men one of the investment objects, but for laymen the investment in cars and classic cars is unsuitable. We recommend a good alternative, such as funds and bonds. With a little more willingness to take risks also real estate.

Facts about cars and oldtimers

The 3 most important facts about cars as a capital investment:

• Attractive increase in value (important: increase in value only in original condition)
• A lot of experience and know how for the valuation and the purchase is a prerequisite
• Active enjoyment of the object instead of ‘just’ investing

If you want to buy cars as an investment, you have to take a lot into account. In addition to the three basic rules of rarity, original condition and patience, the increase in value must exceed the running costs of the car as an investment (sports, youngtimers and classic cars). For laymen, the investment in cars and classic cars is therefore rather unsuitable.

Read more about cars and classic cars here.

Luxury car manufacturer: Ranking

Read more about the top 10 luxury jewelry brands.

1. Rolls-Royce
2. Bentley
3. Ferrari
4. Lamborghini
5. Maserati
6. Aston Martin
7. …

Antiques – Coming soon

Soon you will also find more information about antiques here.

• Sotheby’s
• Cristies

Private lending – duration, costs and comparison

What are the advantages of a personal loan from my bank? Can I get the credit without SCHUFA? There are many questions, we have the first important answers. For all other questions, it is best to contact your bank advisor or a renowned comparison portal for loans. So you are available through various credit mediation portals. The current rate of return on personal loans is mediocre and the risk of personal loans is therefore also not high. Private lending enables simple investment opportunities via various credit brokerage portals. Read more about private lending here.

Of course, there are also disadvantages with personal loans, because when taking out a loan, detailed information about the providers is necessary to avoid mistakes.

Read more about personal loans here.

Questions about personal credit

• What are the advantages of a personal loan from my bank?
• Is a given personal loan earmarked?
• Is a prior credit check obligatory in Germany?
• … read on: Personal loan

Life insurance – risk & asset generation

Life insurance policies can basically be divided into two types, term life insurance and endowment life insurance. Life insurance policies stand out above all as the best protection for partners and children (term life insurance). However, they can do more, for example asset accumulation for old age (endowment life insurance). All about life insurance.

We answer your questions: How does life insurance work? How useful is a life insurance policy? Is it possible to get the life insurance paid out? The good news first, yes! This special insurance is called endowment insurance, or capital-forming insurance. The cost of the insurance you take out depends on your individual goal of protection and the agreed term.

Facts about life insurance

The 3 most important facts about life insurance as an investment:

1. Capital Security
2. Protection for survivors in the event of death
3. Capital accumulation (for endowment insurance)

Depending on your personal family and professional status, different life insurance policies are possible. In principle, however, anyone who has a young family or close relatives should think about them.

Read all about life insurance investments here.

Investment management – Private asset managers

Asset Management – Asset managers help their clients to find their way in the complex and increasingly digital financial world. Through conversations and trust we analyse the financial situation of the client in detail, so trust is central to our work together. Your personal current circumstances and long-term goals are taken into account in the planning. The result is a detailed, personal asset planning, individually developed for the client. Well-founded and high-yield asset management is possible for both financially strong investors and small savers. More about costs and minimum investment amounts later. Read more about private asset management here.

When does asset management pay off?

The big question is: When does asset management start to pay off? Banks offer standardized products for assets starting at 50,000 dollars. Online there are even much lower models.

Standardized banking products from 50,000 dollars

An individual and personal, correspondingly profitable asset management is only worthwhile from a minimum investment sum of 500,000 dollars.

Personal investment advice from 500.000 Dollar

Independent investment advisors help with financial advice and brokerage. But what does an investment advisor do, what costs do you incur as an investor and how does the profession differ from the classic bank advisor in a bank branch?

Read all about the topic: Asset management

The most popular investments

Which of the following investments are currently the most popular? These statistics from the Federal Office are the result of a survey of over 1,000 respondents on the various preferred forms of investment in Germany. At the time of the survey, “about 27 percent of the people questioned owned a life insurance policy. In 2011, around 40 percent of those surveyed still stated that they had taken out a life insurance policy for old-age provision”.

13% fewer life insurance policies in 8 years

You can find further information on statistics on Statista.

Back to the Capital Investment editorial.

Building savings for your own property

With building savings, you benefit from various subsidies such as premiums from the state. You can use your building savings contract for the purpose of building, buying or renovating a house. However, a building savings contract is also interesting for property owners, for example to finance modernisation measures. The respective costs depend heavily on the provider.

Building savings is one of the top 5 most popular forms of capital investment among Germans.

Source: Statista

Procedure and phases

The strengths of a building savings contract lie in its fixed predictability. A bauspar contract consists of two phases, the savings phase and the accumulation phase. With a bauspar contract, you first save about half of the planned bauspar sum (see bauspar calculator), the other half is then given as a loan at a fixed interest rate.

There are many questions as already described, from what is the savings phase to how long is the term of a building savings contract to what is understood by a building savings contract? But also the advantages and disadvantages are important for many who want to start saving. What are the advantages of a building savings contract?

No equity capital necessary

The highlight of any building society contract is that it can be used without any equity capital at all, it can be set up anywhere, on site in branches but also online in comparison portals.

The disadvantage is that the payout is bound to strict regulations, and the risk of default is extremely low, especially in the case of old contracts. Did you already know? It is possible to convert building savings contracts into capital investments by paying premiums – however, this advantage is usually limited to the old contracts just mentioned. Unfortunately, such contracts are hardly ever offered in the current interest rate situation. The current yield of bauspar contracts is mediocre.

Facts about building savings

The most important 3 facts about the building society contract:

1. No equity capital necessary
2. Support through premiums from the state
3. Earmarked (according to strict regulations) for house construction, purchase and conversion

Building savings really pays off for everyone. It’s easy to take out, and the plan has a clear goal. Whether you want to live rent-free or save for retirement, building savings is a real must for building up equity.

Advantages

• No equity capital necessary
• Individual building savings plan that suits your needs (more under Building Savings Calculator below)
• Support through premiums from the state
• Fixed interest on credit balances
• Extremely low risk of default

Disadvantages

• Earmarked (according to strict regulations) for house construction, purchase and conversion

Back to the editorial Capital Investment XXL.

Building savings calculator

The calculation is intended to provide you with an initial orientation as to what purchase price you will be able to afford in the end. The indicated purchase price is an approximate, non-binding value. The following parameters are required for the calculation:

• Current cold rent (e.g. 900 Euro)
• Desired savings (e.g. 400 Euro)
• Move-in date (e.g. 8 years)
• Equity capital (e.g. 50,000 euros)

From these variables you would have the following result

• My possible purchase price
  292,000 Euro
• + incidental expenses (approx. 12 %)
  36,000 Euro
• My total costs
  328,000 Euro

You want to calculate yourself? Here you will find a good calculator for your building society contract:

• LBS building society calculator
• Real Estate Scout 24

Build or buy? New building costs

Build it yourself or buy it, that’s the big question! There are individual advantages and disadvantages to both. We take a look at the most important facts you need to consider when building new or buying real estate.

• More tips on building or buying? Read all about real estate as an investment here.

New construction has many advantages, including, for example, the various options you have as a builder. This concerns the design of the house but also the design of the property. You will be the first to move into the property, so everything is new and of high quality, including the technology in the house. Of course, there are also disadvantages, for example, craftsmen are rare and building a house is expensive. You will have a lot of work ahead of you, applications and also visits to the building site.

Average prices for building land 2017, source: Federal Statistical Office

Table: Construction costs, source: Federal Statistical Office

Loan term for house construction > 5 years

Almost all loans for real estate have a maturity of 5 years or more. Here is the stock volume of loans to households for house purchase with banks in the euro area in November 2010, in billions of euros.

Source: Statista

Expert tips for new construction

1. Check every building contract for errors, preferably by a competent person, such as a civil engineer, an expert or even an architect.
2. Ask to see the developer’s guarantees, which the company has deposited with banks. Should the developer go bankrupt during the construction phase, your construction would be secured.
3. Pay only according to the progress of construction, with each further, central step you transfer another partial amount to the developer
4. Cheap is never good in construction, you should pay attention to that, even when you are getting quotes. In the end, there are always pitfalls that you don’t notice as a private person.
5. Become a member of a landowners’ association, because here you can get legal and economic answers to your questions, even free of charge.

Helpful Links: Buy & Sell Real Estate

Finally, here are some helpful links for your real estate search:

• Real estate portal – Immowelt for the search
• Real estate portal – Immoscout24 for the search
• Luxury real estate agent – Real estate purchase and capital investments
• Real Estate Sales – IHV Real Estate Agents Germany