Rent, buy, live in Frankfurt

A good start in the real estate world is always the purchase of the first apartment. Rainer Ballwanz explains in his interview with us their experiences with real estate in a good A-location. The yield here depends on the type of house or apartment. For example, microapartments have different exploitation possibilities than single-family homes. The meso location is also decisive in pricing, whether in Hausen, Bockenheim and other districts such as the Gutleutviertel or Eschersheim.

Here Frankfurt is located in Germany:

Frankfurt up close:

Rent: Contract & Settlement

After the successful purchase of the property and the execution of the purchase contract, you naturally want to furnish your newly acquired property according to your individual needs. From the living room furnishings, to the garden design, nothing stands in their way of your creative imagination.

Buy: Return on investment through real estate

In our interview, you will learn everything about real estate and returns in Frankfurt. Should you buy a property in Frankfurt or is it more worthwhile to buy nearby, for example in Offenbach or Wiesbaden?

Real estate agent interview about real estate in Frankfurt

The first condominium or real estate as an investment? In this interview you will learn the most important tips & tricks. Buy, rent, live in Frankfurt but also tips for capital investments. We ask the questions, he provides the answers.

The real estate agent team from Frankfurt: Ballwanz Immobilien

FIV: Before we talk about Frankfurt and its real estate market and your recommendations for tenants and buyers, we would like to know a little more about your agency Ballwanz Immobilien. Could you briefly summarize for our readers what your agency does and what you specialize in?

Rainer M. Ballwanz: Ballwanz Immobilien has been specializing in residential tasks and challenges in Frankfurt-Rhine-Main for 30 years. With a highly specialized team, we advise cities and municipalities on concepts for planned construction areas as well as property developers and project developers on product concepts for new construction projects. Of course, we also handle the marketing of these new construction projects on the basis of marketing and communication strategies developed in-house.

We are just as happy to advise private sellers and landlords of residential real estate and to broker purchase and rental agreements. In all our activities, the focus is on the individual. Our aim is to meet their wishes and requirements.

Rainer M. Ballwanz and his real estate agent team from Frankfurt in the meeting:

Real estate with potential in Frankfurt

FIV: As a broker in Frankfurt, which properties do you personally prefer to broker?

Rainer M. Ballwanz: We prefer to broker properties where the price/performance ratio is right from the point of view of demand. In the case of new construction projects, there is also the requirement that the buildings integrate organically into the urban development through their architecture and quality and fulfill their responsibility for the public space.

Popular districts with a future: Rents in Frankfurt

FIV: Neighborhoods for Singles, Families & Co. – For those who don’t live in Frankfurt yet and want to move to Frankfurt, which neighborhoods have a future? Where should you move to in Frankfurt if you want to live nicely?

Rainer M. Ballwanz: Frankfurt is rather small in terms of its geographic extent compared to other major German cities, so that actually all districts have a very good infrastructure and good connections to the core city.

Property in Sachsenhausen, Bockenheim or Frankfurt Ostend?

There are the established residential locations such as Westend, Nordend or Sachsenhausen, where it is somewhat more expensive, but fully satisfactory to live. Those who prefer more urbanity should look around in Bornheim, Bockenheim, for example. In addition to the Gallus and Gutleutviertel districts, Frankfurt’s Ostend district has been one of the most up-and-coming in recent years. If you are moving to Frankfurt with your family, you should definitely check out the new construction areas of Rebstock, Riedberg or the Lyon Quarter.

Rent: Is it worth it? Frankfurt rents

FIV: Rents are a big topic, all over Germany. How has the real estate market and rents in Frankfurt developed in recent years and how will they develop in the future?

Rainer M. Ballwanz: Supply and demand naturally also regulate rents in the city of Frankfurt, which has been growing demographically by around 5,000 to 10,000 residents for years. Residential rents are rising sustainably and are already at a high level when measured against the national average. For existing apartments, average rents of €11 to €13 per square meter can be expected, but for new buildings, depending on location and quality, rents range from €16 to €20 per square meter. If you want to live in one of the modern and exposed high-rises in a central location, you have to calculate a bit more.

Rental prices in Frankfurt at a glance:

In summary, you can expect the following average rents in Frankfurt and the surrounding area:

• Existing apartments: Average rent from € 11,- to 13,-/sqm
• New buildings: Average rent from € 16,- to 20,-/sqm
• High-rise buildings in central locations: average rent over € 20/sqm

Rising prices for new construction rental apartments: Alternatives?

Rainer M. Ballwanz: Due to the fact that the space reserves for new buildings in the Frankfurt urban area are very limited, it can be assumed that there will continue to be an undersupply on the market and that prices for rental apartments will therefore continue to rise.

We should learn that Frankfurt does not only consist of the actual city area, but that there are a large number of towns and surrounding communities directly adjacent and excellently connected, which “feel” as if they belong to the city of Frankfurt. These locations in Frankfurt-Rhine-Main, such as Bad Vilbel, Neu-Isenburg or Offenbach, certainly represent a good alternative for those looking for a home. And usually at a more favorable price level.

Manageable risk for capital investors in Frankfurt

FIV: In Germany, more people rent than buy. What would you recommend to a young couple or even a single person, renting or buying in Frankfurt?

Rainer M. Ballwanz: That depends on personal circumstances and financial feasibility. To answer this question, it always requires an individual consideration. Anyone who basically wants to invest in real estate, whether for personal use or as a capital investment, can do so quite safely with the right property in Frankfurt with a very manageable risk.

The probability of losing money on a residential property with an investment period greater than 10 years is rather unrealistic. Those who come to Frankfurt for work and know that they will probably only stay in the city for one to three years should rather look for a rental property that suits this current stage of life.

Dining room and living room area in a penthouse:

Photo: XOXO Studios

Home & condominium: avoiding buying mistakes

FIV: Anyone who rents in Frankfurt is relatively flexible and can move if necessary. Anyone who buys a property, whether a home or a condominium, is at least tied to the property for the long term by the loan or financing. What are typical first-time buyer mistakes from your experience as a real estate agent and how can you avoid them?

Rainer M. Ballwanz: The biggest mistake is to believe that real estate prices in the Rhine-Main region will fall again on a sustained basis. Assuming that the world remains more or less the same as we know it, prices will move sideways at most as a result of temporary external influences. It is unlikely to get any more favorable.

Tip. Assess investment risk correctly

Contrary to common practice, we recommend not only evaluating the current purchase price, which is often perceived as too high, when making an investment. In our opinion, it is more important to estimate the price that the property is likely to achieve at a later resale and with what probability. Only in this way can the buyer assess the risk or the possible success of his investment.

Attention: Take a long-term view of construction interest rates

Construction interest rates have been at a historically low level for some time, even though they are currently slowly starting to rise. This sometimes tempts potential buyers to underestimate the potentially significantly higher burden when the first fixed interest rate period expires. Financing should also fit the buyers’ individual circumstances and life plans in the long term. We recommend seeking advice from independent financing experts in good time.

Apartment for rent in Omni Tower:

Do not do without expert knowledge

One big mistake is to believe that when buying a residential property, it is best to do everything yourself, without the expertise of a lawyer, financial broker or real estate agent, and thus save money. Digitalization has supposedly made the markets more transparent, at least on the supply side. We do not believe this and advise first-time buyers in particular to seek out trusted advisors who can provide expert guidance through the complex process of a purchase. The decision to buy a property is often rather emotionally driven. Assessing the expected value development, setting up individual financing or evaluating purchase contracts are certainly tasks for experts.

In short – so what you should consider

All tips on the subject of home ownership and condominiums from the expert at a glance:

• Real estate prices in the Rhine-Main region will not fall again on a sustained basis
• Assess investment risk in the long term
• Construction interest rates slowly starting to rise
• Financing must be considered in the long term
• Do not do without expert knowledge

Buying in Frankfurt: Factoring in ancillary costs

FIV: The purchase price of a property is one thing, but what ancillary costs and taxes must buyers in Frankfurt expect?

Rainer M. Ballwanz: In Hesse, the purchase of real estate is subject to 6% land transfer tax, notary fees for the notarization of the purchase contract and, if applicable, the creation of a land charge, as well as fees for the land registry. If one adds the brokerage costs of up to 3.57% of the purchase price, which are to be paid in half by the buyer, for existing properties, ancillary purchase costs of 10 – 12% can arise.

However, the price trend for residential real estate in Frankfurt should also be taken into account here, which has risen by around 8% on average over the past 10 years for existing apartments and by around 9.5% for new apartments. This means that with a similar price development forecast for the coming years, the relatively high ancillary costs of acquisition would be compensated for relatively quickly.

Costs in the purchase of real estate summarized

Incidental purchase costs in Frankfurt and the surrounding area at a glance:

• Real estate transfer tax –> 6
• Brokerage costs –> up to 3,57 %
• Notary fees

Total incidental purchase costs = 10 – 12 %.

Bedroom in the rental apartment Omniturm:

Buy and rent in Frankfurt: Tips

FIV: Frankfurt districts for real estate investment – we come still to real estates as capital investment in Frankfurt, for those, which want to buy and letting. If our*r Leser*in for the purchase, with following letting, decides: Which 2 districts or even satelites around Frankfurt, would you recommend to a buyer for their capital investment in Frankfurt? In your opinion as an expert, where do the most future opportunities lie?

Have clear goals as an investor – Tip 1

Answer: As in the stock market, this depends significantly on the investor’s profile. What does he want to achieve? Is he prepared to take a certain speculative risk with perhaps a higher increase in value, or does he prefer to “sleep soundly” and go for a lower increase in value with the highest possible value stability at the same time? What time horizon is the buyer planning for his investment?

Priority Safety: Investing Westend & Nordend – Tip 2

A large or metropolitan city like Frankfurt always develops from the inside out. Those who tend to seek security are excellently invested in the established locations close to the city center, such as the Westend or Nordend. The city center and the Ostend of Frankfurt have developed exceptionally positively in recent years and have the potential to remain quite exciting for capital investors in the future.

District of Frankfurt with potential: Offenbach – Tip 3

If you are a bit more of a visionary and have some time to spare, you should take a close look at Offenbach, which is separated from Frankfurt only by the Main River. We assume that Offenbach could be one of the biggest winners in the Rhine-Main region in the coming decades.

All tips at a glance:

• Have clear goals as an investor
• With safety a priority: investing in Westend & Nordend
• District of Frankfurt with future potential: Offenbach

These types of real estate have a future: new construction & apartments

FIV: In your opinion, what type of real estate has a future in Frankfurt, what should one invest in? Small, large, existing, new construction?

Real estate trend: micro apartments, student rooms & one-bedroom apartment

Answer: Investing in residential real estate will generally be a good decision in Frankfurt for the foreseeable future. Those who want to diversify their risk and are not looking for self-interest should perhaps rather buy two small apartments instead of one large apartment.

New construction, condominium or existing property?

New construction has the advantage that the buildings are built to the current state of the art and building regulations and one does not have to expect any subsequent investments in the first few years. If the location of the property is more important to you, you will find a broader offer in existing apartments. When investing in existing properties, however, we recommend checking in advance whether the legal requirements to be expected in the medium term with regard to energy efficiency upgrades will be feasible in principle.

Last but not least: Prices for condominiums in exclusive high-rise buildings have developed disproportionately well in Frankfurt and also represent an exciting sub-segment of the investment market for the future.

Selling real estate: Advisor for help

Finally, one more question: You had mentioned the typical mistakes buying a property. Many buy, but some also want to sell. As an experienced real estate agent in Frankfurt, what tips can you give to those who are selling a property for the first time? What are the first steps and how do you successfuly sell a property in Frankfurt?

Answer: We recommend to the private seller of a property to take an expert advisor to the side, who understands the market/price mechanisms analytically and knows how to estimate the value of the property well-founded. Only in this way can the best possible price be realized in the time frame in which the seller would like to dispose of the proceeds.

Many thanks to Rainer M. Ballwanz for the interview!

Rent, buy, live in Gelsenkirchen

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First apartment? Step by step to capital investment

As soon as you move into your first own apartment, for most people it’s rent, rent, rent. Every month you go to work for many hours in order to spend most of it on the next rent due at the beginning of the month. It’s no wonder that many young people are considering buying a condominium as soon as possible.

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Rent, buy, live in Frankfurt

A good start in the real estate world is always buying your first apartment. Lydia Ishikawa explains in her interview with us her experience with real estate in a good A-location. The yield here depends on the type of house or apartment. For example, microapartments have different exploitation possibilities than single-family homes. The meso location is also a decisive factor in pricing, whether in Hausen, Bockenheim and other districts such as the Gutleutviertel or Eschersheim.

Here Frankfurt is located in Germany:

Frankfurt up close:

Rent: Contract & Settlement

After the successful purchase of the property and the execution of the purchase contract, you naturally want to furnish your newly acquired property according to your individual needs. From the living room furnishings, to the garden design, nothing stands in their way of your creative imagination.

Buy: Return on investment through real estate

In our interview, you will learn everything about real estate and returns in Frankfurt. Should you buy a property in Frankfurt or is it more worthwhile to buy nearby, for example in Offenbach or Wiesbaden?

Real estate agent interview about real estate in Frankfurt

The first condominium or real estate as an investment? In this interview you will learn the most important tips & tricks. Buy, rent, live in Frankfurt but also tips for capital investments. We ask the questions, he provides the answers.

UK Immobilien: Real estate agent in Frankfurt

FIV: Before we talk about Frankfurt and its real estate market and your recommendations for tenants and buyers, we would like to know a little more about your agency UK Immobilien. Could you briefly summarize for our readers what your agency does and what you specialize in?

Uwe Kirsten: UK Immobilien has been in existence since 2004 and is one of the largest letting agents for residential property in the greater Frankfurt area. A permanent employee takes care of the interested parties together with our inspection service. Due to the amount of new properties every week, we also employ our own photographer.
Second focus is real estate sales of new and existing properties (apartments, houses).

Since 2021 UK Immobilien, as one of the leading real estate companies of Frankfurt, is a regional directorate for the Federal Association for the Real Estate Industry and the owner Uwe Kirsten, was appointed as a delegate for the Federal Congress of the Real Estate Industry.
We are happy to go the extra mile for our customers – whatever that may be. Trust is an important cornerstone and therefore anchored in the company logo.

Favorite real estate in Frankfurt – skyscrapers

FIV: As a broker in Frankfurt, which properties do you personally prefer to broker?

Answer: Of course, the new apartments in the skyscrapers, such as the Grand Tower or the Solid with their breathtaking views, are great. The Grand Tower in particular has generated a lot of media attention, for which we have produced three Youtube videos, which have generated over 60,000 views and more than 100 comments. Since these buildings are not open to the public, it is exciting to be able to look behind the scenes almost from day 1 and move around the building quite freely.

The UK Real Estate Team:

Urban districts and market development – Frankfurt’s future

FIV: Neighborhoods for Singles, Families & Co. – For those who don’t live in Frankfurt yet and want to move to Frankfurt, which neighborhoods have a future? Where should you move to in Frankfurt if you want to live nicely?

Uwe Kirsten: The most popular districts in Frankfurt have always been the Westend, Nordend, Bornheim and Sachsenhausen. These are long-established neighborhoods with a good infrastructure and many opportunities for leisure activities. Families have also discovered Riedberg, which has been booming in northern Frankfurt for years and continues to develop with unprecedented momentum. Singles/couples prefer to live in the city, and “living by the water” is a popular theme, with which the Westhafen and Osthafen are predestined.

Development of the real estate market in Frankfurt

FIV: Rents are a big topic, all over Germany. How has the real estate market and rents in Frankfurt developed in recent years and how will they develop in the future?

Uwe Kirsten: The general interest of the population has been strongly focused on the real estate market, because politically some glaring mistakes were made and people have now been trying for years to fight the effects instead of the causes. One example of this is the rent brake.
Apartments are still urgently needed in the low price segment! However, the new buildings are so highly priced at currently around 10,000 euros/sqm that the rents have to be set accordingly high and are only affordable for higher earners.

Impact of the pandemic on the real estate market

Uwe Kirsten: As a result of the pandemic, fewer people have been looking for housing for the past two years. On the other hand, more and more new buildings are coming onto the market. Just the other day I saw that the first new buildings ready for occupancy are being offered. This was unthinkable until before the pandemic! Because otherwise new construction projects were practically always sold out with the start of construction.
By the way, we produce our own podcasts on the development of rents and purchase prices in Frankfurt, where we go into the figures and developments in great detail. You can listen to them at www.immofunk.de or on all popular podcast platforms.

Buy or rent? Real estate recommendations

FIV: In Germany, more people rent than buy. What would you recommend to a young couple or even a single person, renting or buying in Frankfurt?

Uwe Kirsten: The smartest person is actually the one who owns property and rents it out to someone else – but lives in rented accommodation himself. Why? Because repairs, maintenance, depreciation, interest expenses for loans, etc. in the owner-occupied property cannot be deducted from taxes. A great advantage that only a few know about or implement.

Frankfurt’s city center:

First condominium in Frankfurt

FIV: Anyone who rents in Frankfurt is relatively flexible and can move if necessary. Anyone who buys a property, whether a home or a condominium, is at least tied to the property for the long term by the loan or financing. What are typical first-time buyer mistakes from your experience as a real estate agent and how can you avoid them?

Uwe Kirsten: A typical first-time buyer mistake likes to start where you don’t expect it, even though you haven’t really started yet, and that is: “Where can I find a suitable property”!
You should not rely on just one source of information, but rather search or observe the market as comprehensively as possible, as prices can vary depending on the source.

Since this is very time-consuming, we have set up a so-called market radar as a customer service at https://www.uk-immobilien.com/wohnraum-monitor/, which displays all sources independently of the provider and portal. With this added value, you have the entire market in one place and can send your inquiry directly to the respective market participant if necessary.

Difficulties in the valuation of the property

The most difficult thing for laypersons is probably the assessment of the technical condition, and this applies both to new buildings and to existing properties. Here, it is money well spent to inspect the property at the appropriate time with an independent person of trust and to check it accordingly.

But even seemingly simple issues such as a reasonable square meter size of the apartment, the layout / cut, good placement furniture options, equipment, view from the balcony, infrastructure such as connections to supermarkets and public transport, and noise or odor emissions such as street noise or a restaurant located in the house, are to be considered. This cannot be summarized in a few sentences; not for nothing are there entire series of guides and books on the subject. Most first-time buyers pay little attention to the running costs, even in terms of maintenance or special charges. This can add up quickly and should not lead to a rude awakening.

Incidental purchase costs and land transfer tax in Frankfurt

FIV: The purchase price of a property is one thing, but what ancillary costs and taxes must buyers in Frankfurt expect?

Uwe Kirsten: When acquiring the property, 6% land transfer tax and approx. 2% for notary and district court costs are currently due in Hesse, as well as the brokerage fee (zero to 3.57%) if applicable.

Rarely are the running costs of a property taken into account. If a property is unoccupied, recurring costs will still be incurred, such as insurance, garbage collection, road tolls, administration, janitorial services, cleaning/maintenance, etc. Maintenance reserves or a special apportionment should be checked in advance in order not to be faced with unforeseeable costs.

Cost summary:

• Real estate transfer tax: 6%
• Notary fees: 2%
• Brokerage fee, if applicable: up to 3.57

Modern living room in downtown Frankfurt:

Capital investment through real estate – tips from brokers

FIV: Frankfurt districts for real estate investment – we come still to real estates as capital investment in Frankfurt, for those, which want to buy and letting. If our*r Leser*in for the purchase, with following letting, decides: Which 2 districts or even satellites around Frankfurt, would you recommend to a buyer for their capital investment in Frankfurt? In your opinion as an expert, where do the most future opportunities lie?

Uwe Kirsten: More important than a specific district is the infrastructure. There should be a subway or S-Bahn station within a 10-minute walking radius, as well as a supermarket. An elevator is obligatory from the 2nd floor upwards, as well as a fitted kitchen and a balcony. We have been observing for almost 20 years how the market and people’s demands are changing. If you follow these hints, you will find your tenant in every district of Frankfurt, if it is offered at a fair price.

Types of real estate with a future – investments and risks

FIV: In your opinion, what type of real estate has a future in Frankfurt, what should one invest in? Small, large, existing, new construction?

Uwe Kirsten: Unfortunately, you can’t give a general answer to that… 1 to 2-room apartments are always a good investment, since Frankfurt is a city for singles and commuters. It is important that the apartment is not too big. A 1-room apartment with 50sqm is past the need and should not be much larger than 30sqm. 70 or 90sqm is too much for 2-room apartments and better suited for 3-room apartments. 2-bedroom apartments should have around 50sqm for a reasonable price/quality ratio. From 60sqm the ratio drops rapidly. I would also advise 2x 2-room apartments rather than a 4-room apartment to reduce the risk of vacancy.

Many investors prefer new construction, because in the first 10 years they can expect far fewer repairs than with an existing property. At the end of the day, however, the bottom line has to pay off, and a property that may be in an exposed, sought-after location can score points with many other factors.

The cut of the apartment is not to be underestimated.

Square rooms are much more popular with searchers than triangular or tapered rooms. Many capital investors approach us in the run-up to a purchase and send us their floor plan selection, from which they would like to buy a property. With this free assessment in conjunction with a rental value analysis by us, everyone has done well so far, even if sometimes we even had to advise against a purchase.

Yield through real estate sales in Frankfurt

FIV: Finally, one more question: You had mentioned the typical mistakes buying a property. Many buy, but some also want to sell. As an experienced real estate agent in Frankfurt, what tips can you give to those who are selling a property for the first time? What are the first steps and how do you successfuly sell a property in Frankfurt?

Uwe Kirsten: Most real estate sellers also have the next question immediately in mind: With or without an agent? Self-marketing may even have been quite risk-free until a few years ago. In the meantime, however, there are so many legal tightenings with permanent changes and regulations that consequences are not conclusively overlooked and most owners are simply overwhelmed. A private seller can no longer do this with legal certainty, and everything you do for the first time is likely to go perfectly in the rarest of cases.

Risks in the sale of real estate – assessments and expert opinions

In addition, there is the risk of setting the price too high or too low, and we are not even talking about the technical condition and legal obligations to provide information, so as not to risk a reduction in the purchase price or even a reversal of the transaction later… Just as a lawyer does not represent himself in court or a doctor does not operate on family members, we recommend to give the sale into professional hands. Many like to use online valuation tools for a first indication. However, one should be aware here that most platforms resell the personal data entered to third parties.

It might be more target-oriented to order 2-3 reputable brokerage firms into the house and to question their assessments and expertise. To do this, you should take a close look at the online presence of the real estate agency in advance. How is the presentation, is there information for owners and can I see the employees?

In all of this, it is important to remember that real estate is probably the largest asset or transaction in a real estate owner’s life. Does one really want to leave that to a first attempt of one’s own? It is much more important that one feels well taken care of and comprehensively informed about one’s professional, legal, contractual or financial questions when making such an important decision.

FIV: Thanks to UK Real Estate for the interview!

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