Why Germans Love Renting Their Homes

CLAPTON

Kicker wrote: »

As a general rule of thumb it's 2% of acquisition costs over 50 years. Reducing balance depreciation widely not available since the early 2000s. Tax breaks surely played a big role in those calculations like 15+ years ago, but nowadays people coming to their senses also and realize that positive cash flow is a nice thing to have at times...

still don't understand why anyone becomes a landlord if they make no money : why not just invest in the DAX?

Kicker

Since 2011 the DAX soared from around 5000 to 9400 points as of today. So where is it going to be in 5-25 years from now and will there still be a Euro at all? Tangible assets are a diversification to one's portfolio, we call it "concrete gold", and it's a version of investment for the risk averse while money's basically burning in the bank at 1% or lower interest rates. Like I said: In the right conditions it's still a viable option.

And of course people intend to make money by becoming a landlord. So do people investing in all kinds of different fields. The reality comes to haunt many as this forum is proof to, I dare say.

zagubov

ruggedtoast wrote: »

Really? I've lived in Japan and I did not find that to be true.

That Japan had more floorspace per person?
That would be quite a complex thing to notice.
According to this chart they have 50 dwellings per 100 people compared with about 40 for Western Europe.
http://notbuyinganything.blogspot.co.uk/2012/03/average-house-size-by-country.html
shows Japanese house areas bigger but with fewer people per household

Tancred

antrobus wrote: »

Past tax advantages?

I believe it's the case that until recently German tax law meant that you could claim depreciation as a business expense. Something along the lines of - spend €100,000 on a new build property for rent, and you can claim €5,000 a year as depreciation - meaning that the rental income was effectively tax free.

But residential properties do not normally depreciate. Only commercial ones have dilapidation charges.