Upfront, most costs can be flipped to the renter if the property is rented. Only the costs for maintenance and property administration and the bank fees can not be turned to the renter.
The costs that have to be paid are property tax – this is different from town to town but very small (between 150 Euro and 300 Euro usually for an apartment per year, a bit more for a single-house; it depends on the size of the property ground).
The maintenance (reserve fund), which is mandatory when owning an apartments as part of a community, is usually about 0.75 to 1.5 Euro per square meter living area per month. Its not necessary, but recommended if you are the sole owner of the property.
Garbage pickup, water, common house electricity, housekeeping, maintenance of the heating system etc. are additional costs which sum up to about 0.5-2 Euro per square meter per month. All of these have to be paid by the tenant if the apartment or house is rented out. Even the property owning tax normally will be refunded by the tenant to the owner as part of the normal monthly utility pre-payments.
Cost of financing are not subject of a possible flip to the tenant.
Moreover to obtain financing as a foreigner you need to get incorporated in Germany. The cost to get incorporated as well as to operate the company are not subject of a possible flip to tenant. This will lower your yield, but the leverage of your equity will become much better ( as well as riskier, as you know).
We will provide a sheet along with our investment proposal, so you can see which costs will occur, based on the property you are interested in.
Article revised by Alexander Korte on 2011-03-12