If you are planning to buy a condominium, decide whether you prefer an apartment in an old building or in a new building. This question arises if you want to live in the apartment yourself, but also if you are thinking of renting it out. As with other investments, it is advisable to weigh up the pros and cons of each property. You should be aware that there are advantages and disadvantages to both property options. Once you have completed the purchase, you will generally no longer be able to change your decision. In this case, your only option would be to resell the apartment. In this case, you may have to accept losses. As a rule, you commit to a property for the long term once you have completed the purchase. It is therefore important that you consider the advantages and disadvantages of buying an apartment in an old building. In addition to defining what a period property actually is, we offer you an overview of the advantages and disadvantages that could arise when buying one. You will also receive some tips that can make buying an apartment in an older building easier.
What is an old apartment?
You may have asked yourself what an old apartment actually is. Is there a definition of an Altbauwohnung? This question can be answered very clearly: there is no legal definition or generally binding explanation of what an Altbauwohnung is. The definition of an Altbauwohnung from the construction industry can help with this question: Here, apartments that were built before 1949 are considered old apartments. There are also some typical features that characterize an apartment in an old building:
– Rooms with large living space and high ceilings: These can reach up to 4 m
– Walk-through room
– Small pantry behind or in the kitchen or pantry
– Spacious layout of the rooms
– Wooden windows with single glazing
– Floors made of real wood (floorboards, parquet flooring)
– Wide skirting boards made of real wood
– Door frames made of real wood
– Visible wooden beams serving as supports
– Stucco work on the ceiling
– Toilet or bathroom not centrally located
– In some apartments, the toilet and bathroom may be located outside
– Stove heating or floor heating
Bear in mind that the façade of a house in which you want to buy an old apartment may be a listed building. This can result in high renovation costs, which you will have to bear proportionately as a co-owner.
Definition of a listed building
Unlike an apartment in an old building, there is a clear definition of a listed building. It is a building or an architectural monument whose (quote from https://wirtschaftslexikon.gabler.de/definition/einzeldenkmal-52956):
“Preservation due to e.g. historical, artistic, scientific, urban planning, ethnographic or technical significance is of public interest and has acquired monument status either by administrative act or by law.”
Whether or not a building is listed falls under the sovereignty of the federal states. This means that the state government, as well as the cities or municipalities, can decide independently whether or not to grant a building or monument listed status.
Owner is responsible for the preservation of the listed building
It is very important that you find out whether the building is a listed building before buying an apartment in an old building. If this is the case, the original condition must be preserved. Restoration, for example of the façade or the installation of new windows, must be carried out in such a way that the historical heritage of the building is preserved. As a result, you may be faced with high costs, not least because you have to comply with various obligations under building law. In addition, you are limited in your ideas with regard to modernizing or renovating the building. In the case of a building that is not a listed building, you can give free rein to your ideas. If you are planning refurbishment measures, it is mandatory that you coordinate these with the authorities in advance.
Utilization of support measures
If you have purchased all or part of a listed property, you will not be left completely alone with the requirements for refurbishment. You have the right to take advantage of funding programs that serve the acquisition, but also the implementation of refurbishment measures. For example, there are KfW programs that promote energy-efficient refurbishment, as well as funding programs specifically for the acquisition and refurbishment of listed buildings. You can also take advantage of the so-called AfA. This is the tax term “deduction for wear and tear”. If you have invested in the renovation of a building and use this building yourself, you can use ninety percent of the renovation costs as a tax write-off over a period of ten years. As a result, you pay less tax because your taxable income is reduced by the proportion of the refurbishment costs.
Old apartment: the advantages and disadvantages at a glance
Old apartment – yes or no? Before you answer this question for yourself, it is important that you get an overview of the advantages of this property. You should also find out about the disadvantages. Specific information will help you to make the right decision. We will first give you an overview of the advantages and disadvantages of an old apartment. Take a close look at the points and include them in your individual decision.
Advantages of buying a condominium in an old building
Condominiums in old buildings have various advantages over apartments in new buildings. If these advantages are very important to you and you feel that the disadvantages are not so serious, buying a condominium in an old building is the right choice for you.
An overview:
+ Old building apartments stand for a classic style and exude a special charm
+ You live in a special living atmosphere
+ The rooms have a height of 3.50 meters or more and are flooded with light
+ The apartments have wooden floors (parquet or floorboards)
+ Many of the apartments have attractive stucco ceilings
+ If the apartment is empty, you can move in immediately as the building already exists
+ The solid walls provide efficient heat protection in summer
Disadvantages of buying a condominium in an old building
Now get an overview of the possible disadvantages that you will have to accept when buying an apartment in an old building. You can decide whether it is actually a disadvantage based on your own personal feelings.
– The costs for refurbishment and renovation can be higher than for newer apartments
– Due to their height, the apartments have a higher energy consumption and are sometimes difficult to heat
– You have little or no scope to influence the layout of the rooms in terms of design
– The electrical wiring in many old apartments is outdated
– There is usually no elevator to get to the upper floors
– There are no underground garages for old apartments
– The building may be a listed building, which can be associated with costly conditions
The advantages of an old apartment
In the following, we would like to take a closer look at the advantages of an apartment in an older building in order to provide you with an essential decision-making aid.
Location and surroundings
Old apartments are often located in larger cities close to the city center. Here you benefit from a good infrastructure. This means that you may not need to use a car, at least if you are moving around the city. Public transport runs at convenient intervals and is easily accessible. Schools and daycare centers, shopping facilities, restaurants and cafés, as well as doctors and art and cultural institutions are all within easy reach. As a rule, you will find opportunities for local recreation in a green area or park in the immediate vicinity.
Classical architecture
Compared to a new building, the architecture is more stylish in the eyes of many people. These are old, classic architectural styles that hark back to bygone eras. These architectural styles are particularly popular with architecture fans. The same applies to the high ceilings, which exude a special flair for living. The exterior walls of the old buildings are very solid. They effectively keep out high temperatures on hot summer days and also offer good thermal insulation without the need for extensive refurbishment.
Classic equipment
In terms of furnishings, old buildings differ from new condominiums in the amount of wood used, which exudes a special charm. The apartments often have real wooden floorboards or parquet flooring. Solid wooden banisters are installed in the stairwells. There are ornaments and beautiful decorations on the doors, but also on the walls and, where available, on the balcony. The living atmosphere is special and very individual.
Lower price
Another advantage is the lower price compared to a new build. This is especially true if you decide to buy an unrenovated apartment.
The disadvantages of an old apartment
Before making the final decision, it is advisable to take a closer look at the disadvantages of an apartment in an older building. For example, bear in mind that the floor plan of an apartment in an older building is fixed. There is often no scope for individual design. As a rule, you have to use the apartment the way it is laid out.
Overdue refurbishment status
The term “refurbishment status” refers to measures that are due or even overdue for a longer period of time. You must take this into account in your budget planning. In individual cases, you as the buyer may be faced with high costs.
Poor energy efficiency
The charm of high rooms and the special feeling of living are the positive aspects that you benefit from when buying an apartment in an old building. However, you should also consider the other side: high rooms result in poor energy efficiency. The original windows are only single-glazed, the wood can warp and the windows leak as a result. Although the exterior walls are solid, there is no traditional insulation, which can also have a negative impact on energy efficiency.
Fixed floor plan
When buying a condominium in a new build, you can influence the design of the floor plans. Dry construction usually allows you to make changes afterwards. You don’t have this leeway when buying an apartment in an old building. You have to accept the layout as it is. It is therefore important that you like the apartment when you first view it and that you can easily imagine living in the rooms as they are.
Outdated cables
Be sure to find out about the renovation status of electrical and water pipes. If these are outdated, you may be faced with functional restrictions and high costs as a result.
Lack of modern living comfort
New-build apartments are usually equipped with an underground garage. This convenience is lacking in an apartment in an old building. You may also have to contend with mold due to the construction method. This mainly affects the basement and lower floors.
Requirements due to monument protection
If the building is a listed building, you should definitely look into the conditions. On the one hand, conversions are not possible. On the other hand, you as the owner may incur costs for any requirements.
What is a renovated old building?
You are offered a condominium that is advertised as a renovated old building. What do you have to imagine?
A renovated apartment in an old building is a good choice for you to buy if you are afraid of renovation and the associated costs. A renovated old building has been brought up to date in many areas. This may concern the insulation, but also the water and sewage pipes and the electronic systems. As a rule, old buildings have been bought by a real estate company, modernized and resold. You pay a higher price, but you have cost certainty. You know in advance what you have to invest. This is different when buying an unrenovated old building.
Basic refurbishment measures
Basic refurbishment measures serve to preserve the substance of the building. This includes, among other things
+ Energy refurbishment (insulation, replacement of heating and windows)
+ Repair of the facade
+ Sealing the roof
+ Modernization of the building services
* Renovation of the floors
Modernization
Modernization can extend or supplement the basic refurbishment measures. The aim is to improve the quality of living. This includes, among other things:
+ Change in the room layout
+ Modernization of bathroom and kitchen
+ Combining rooms
+ Creation of additional living space by extending the roof and outbuildings
Modernized apartments in old buildings combine the advantages of an old building with those of a new building. You live in a classic ambience and still benefit from modern building technology. The disadvantage is that these apartments are often more expensive than a new-build apartment. However, due to the limited possibilities, they are often not at the same structural level as a new-build apartment.
What should I bear in mind when buying an apartment in an old building?
You have decided to buy an old apartment. There are a few things to bear in mind here. For example, when buying an unrenovated old building, you usually have to plan further investments to maintain the building. The efficiency of the measures often depends on whether you want to live in the apartment yourself or rent it out. In the case of owner-occupation, there are often additional costs for the individual design of the rooms according to your ideas. We give you tips for planning and preparing the purchase of an apartment in an old building:
Tip 1: Have the condition of the property assessed by an expert
When you buy a condominium, you will receive various documents. These include, among other things
Declaration of division
Community rules
Collection of resolutions and maintenance reserve
Minutes of the owners’ meetings
Business plan
Property charge statement
Energy certificate
Heating cost bills
Once you have received these documents, you should have them checked by an expert. This can be an architect or a civil engineer who has expertise in the valuation and assessment of old buildings. Be sure to include the specifications for the communal part of the property in the inspection.
It is also important that you have the following things checked with regard to the fabric and condition of the building:
Dampness of masonry and walls (basement, lower floors)
Condition of the roof surface (roof structure, roof tiles)
Energy condition of windows and doors
Inspection of the building services (heating system, electrical installations, piping)
Condition of the interior (floor, walls, mold, vermin)
Inspection of listed building specifications
Tip 2: Raise equity for the purchase and carefully plan the financing of the refurbishment measures
You have decided to buy an old apartment that you would like to renovate or modernize. As a rule, you will need a loan to implement the measures. It is advisable to put the financing of the purchase price and the renovation measures on a secure footing before signing the purchase contract. This way you will not experience any nasty financial surprises.
You should contribute one fifth of the total amount as equity
The higher the equity, the lower the financing risk
Shorter terms mean lower interest payments
Set aside a cash reserve for unforeseen items during the renovation
A further cash reserve is recommended for unexpected defect rectification and maintenance repairs
Checking the purchase price
Commission a valuation report from a publicly appointed and sworn expert to check the purchase price.
Energy-efficient refurbishment
If an energy-efficient refurbishment is required, you should consult an energy consultant. Such advice is usually provided by an architect or civil engineer who has the relevant additional qualifications. You will receive specific proposals for the energy-efficient refurbishment. All measures can be summarized and explained in an expert report.
State support
Check whether you can take advantage of state support in the form of promotional loans for the refurbishment measures. Many measures are subsidized with low-interest loans and government grants, for example from the KfW Bank. The federal states also award individual subsidies.
Tip 3: Take out the necessary insurance as early as possible
As the owner of an old apartment, it is highly recommended that you take out the following insurance policies. Decide to take out insurance as early as possible to protect yourself against unforeseen costs.
Building insurance for so-called natural hazards
Liability insurance for homeowners and landowners
Legal expenses insurance
Loss of rent insurance (for rented condominiums)
Residual debt insurance to cover the loan in the event of illness, unemployment or death
Before taking out insurance, check which policies have already been taken out by the community of owners for all properties in order to avoid double cover.
Tip 4: Save up maintenance reserves
As the owner of a condominium, it is advisable to build up reserves. This way, you will not be surprised by costs that may arise for major repairs or renovation work that needs to be announced. After purchasing the apartment, you are automatically a member of the condominium community (WEG). The community makes all decisions concerning the house and the property. If measures are required, they are financed from the maintenance reserve. Each member of the community of owners saves up the reserve in monthly installments. Avoid one-off payments, which can place a heavy burden on your budget, and set aside monthly reserves from the outset. The amount is determined by the community of owners. It is usually 0.8 % to 1 % of the purchase price per year.
Conclusion
Before buying a condominium in an old building, you should weigh up the pros and cons carefully. However, don’t just follow objective criteria, but also your gut feeling. Bear in mind that you are often making a decision for life or at least for a long period of time. This is especially true if you want to live in the apartment yourself. Don’t do without professional advice and secure financing if you want to realize your dream of owning your own home.
