Buying a flat or a full apartment block is not just another price tag. The block typically is cheaper by sqm as well as the factor (the multiplier of the annual rent that gives the price). If your budget puts you in the position to buy the full block of apartments and you have a good offer (which is not easy in the current seller market) I would always advice you to choose the investment in the full block. Here is why.
Mainly because of four reasons:
- Typically the sqm-price of an apartment block is more attractive than the flat price.
- Thy typical overall price tag, which is a factor/multiplier of the rent, is more attractive.
- The solution for technical problems could be post boned or executed in a cheaper manner as the coop would do.
- The property manager is aware that the investor is the boss.
- Property Manager can be replaced easily and fast (in comparison to the coop-manager)
First of all, even as a flat buyer you own a share of the full building, so you are liable for potential future and yet undiscovered existing problems. Mainly of technical nature. Once a problem occurs in a co-owned (coop) flat there is no chance to post bone works for the single owner, as the majority of owners might decide for prompt repair.
On top for the property manager / administrator a flat owner only weights as much as his shares weight in the coop.
Owning the house gives you full responsibility and the full attention of the property manager.
Most problems ?my clients and myself as real estate owners had were due to misbehavior or even fraud of the property manager.
Owning the full building is more work, as you can not rely on the wisdom of the co-owners, but it gives you much more control and what you do and when you do it.
You can easily replace the property manager. For example it happened to me that the property manager changed employees and the house was not very well re-rented, costing us a fortune. In this case ist easy to switch the manager, as switching the manager for a single owner of a flat in a condo is nearly impossible.
Owning the full house can even have building potential on the part of the plot that is yet unbuild or on a yet unconverted attic.
As this might be the case in a condo as well, its much harder to convince the co-owners to unlock the hidden value, because some of them might even be self-users and only want to avoid the noise of the constructions, others are afraid of legal or technical problems.
The sum it up:
Rule 1:?If you have a budget that fits a good offer of an apartment block, go for the block, instead of single apartments.
Rule 2: If you have the budget for more than one flat, then choose two flats in the same building, especially when you don’t speak German.
Rule 3: If your choose the flat startegy, go for serviced and furnished apartments, that are rented with a self-terminating contract, instead of a typical German standard contract, that is unterminated (life-long, renter chooses when to leave).