Selling an apartment building in Germany: income and value

Choose a strategy before advertising

Set out your objective, timetable and essential conditions first. Is a prompt sale of the whole asset the priority, or is there time for wider marketing? Do co-owners, an estate community or lending banks need to participate? These questions influence the process more than an unsupported target price.

Selling the building as a whole and selling individual apartments are different projects. Creating separate apartment ownership requires its own legal and technical assessment and may introduce additional costs and tenant-protection issues. Prices of existing individual apartments cannot simply be added together to establish the building’s value.

Make actual rental income transparent

Create a unit-by-unit schedule showing use, area, tenancy start, net rent excluding service charges, advance payments, deposit and contractual adjustment rules. Flag vacancies, arrears, rent-free periods and side agreements. Commercial units and parking spaces should be identifiable separately.

Distinguish current rent, contractually secured changes and assumed market potential. A buyer can assess higher future income only if timing, costs and legal requirements are clear. For a single occupied unit, see our guide to selling a tenanted apartment.

A rent multiplier is not a complete valuation

Consider a simplified example: annual net rent of €72,000 against an assumed purchase price of €1.44 million gives a multiplier of 20 and a gross yield of 5%. Acquisition costs, operating expenses and investment are excluded. This is neither an asking-price recommendation nor an expected net return.

The income approach under section 27 ImmoWertV considers income achievable under market conditions alongside other valuation inputs. Location, remaining useful life, land and property-specific features matter too. A useful property valuation must rest on assumptions that can be checked.

Explain condition and capital expenditure

Roof, façade, windows, services, heating and common areas are central to a buyer’s assessment. Collect available invoices, maintenance records, surveys and quotations. Clearly separate completed works from approved projects, recommendations and rough estimates.

Attractive photographs do not remove a known maintenance backlog. Transparent information supports credible calculations. Major works immediately before a sale make sense only when cost, approvals, disruption to tenants and the likely effect on the achievable price have been considered together.

Organise documents and viewings

• Land-register extract, cadastral plan, floor plans and reliable area records.
• Building documentation, available permits and energy certificate.
• Rent schedule, leases, amendments and deposit records.
• Service-charge accounts, ongoing service agreements and insurance information.
• Technical records and known defects, disputes or public-law issues.

Provide sensitive documents through a controlled process. Establish serious interest and financial plausibility before arranging viewings with residents. A structured data room reduces repeated questions but does not replace the buyer’s own professional assessment.

Prepare the contract and economic handover

Compare offers by price, financing, conditions and a realistic completion date. A high offer with unresolved funding may be less dependable than a well-prepared one. Record outstanding issues before the notarial appointment.

Existing tenancies generally continue when ownership changes. Rent, costs, accounting responsibilities and deposits need an orderly allocation, while statutory liability must still be considered. For an initial enquiry, provide location, property type and timeframe. The rent schedule can then support a more detailed discussion of your sale.