With a monthly expense of only €155, achieve an expected value gain of over €58,000 in 10 years! How is this possible? Let’s look at an example from one of our Activ Bilanz properties in the Schillerstadt Marbach! Contrary to the expectations of many, generating passive income from your property investment doesn’t solely depend on when you pay off your mortgage but also on considering what would happen if you were to sell your property after the first fixed interest period (10 years). To make your investment a profitable one in the medium term, several factors must align. The most critical prerequisites are a solid building structure, good rentability, and the potential for success. Your investment must be financially predictable during this time frame. You need to take into account how much capital you have invested and what portion you were able to repay during this period. At Activ Bilanz, we want to show you through this concrete example how you too can profit tax-free after the first decade. This calculation is only a part of our consulting services provided to our customers. Get informed and become a landlord! We support you in making the right investment decision, financing, and later property management.
Our Investment Property in Marbach
Multifamily house built in 1997 with underground parking and photovoltaic system. It consists of 15 compact units of approximately 70-76 sqm and 5 units of about 53 sqm. All apartments have a terrace or balcony. Key Facts: 20 units, 24 garage parking spaces, 100% occupancy rate, excellent infrastructure, high potential for rent increase, commission-free directly from the property developer.
Example Calculation of Investment in Marbach
Property: 2-room apartment with 53 sqm and underground parking
Assumption: €70,000 taxable income per year
Tax savings: €30
Total income: €580
Interest (1.25%): €253
Repayment (2%): €420
Utilities and reserves: €62
Total expenses: €735
RESULTING IN A MONTHLY COST OF ONLY €155
Profit is tax-free after 10 years!
The relationship between loan repayment (balance) and the calculated property value in 10 years, minus the contributed equity, ultimately results in the projected profit. The interesting part is that a significant portion of the repayment is generated through income (rent + tax). An annual appreciation of a maximum of 1.5% per year can be assumed here. In this example, this would amount to a contribution of approximately €18,600 without considering potential rent increases over 120 months at €155 each. Within the 10 years, around €54,900 was repaid, resulting in a remaining loan balance of €193,099. The expected value after 10 years would be €287,814. This yields an increase in value of €39,814. If we then include the initially invested equity of €17,500, the total tax-free profit after 10 years is:
Property value gain: €39,814
Repaid portion of the property: €54,900
Total value: €94,714
Total costs: €18,600
Equity at the time of taking the loan: €17,500
Invested capital: €36,100
RESULTING IN A WEALTH GAIN OF €58,614
Therefore, the investment has already more than paid off after 10 years! The return on equity is 162%!