MIM IS MUNICH'S ANNUAL REAL ESTATE EXHIBITION

Every year our company visits the MIM exhibition, and every year it surprises us, discovers new names, brings new projects and fresh ideas to the fore. What was different about the 2018 exhibition?

The main trend of the MIM 2018 exhibition was profitable real estate:

– business apartments (in Germany they are called BORDINGHAUS),

– student apartments.

Over the past few years, the demand for profitable real estate in the segment of small apartments has been growing in the Bavarian capital. Considering that in Munich the yield of ordinary apartments is from 1.5 to 3%, such apartments are offered with a yield of 7%.

The cost of apartments is usually not high, this is possible due to the small living area of this type of property. But nevertheless, this is a full-fledged apartment with all amenities and internet connection.

The price range is 160,000 – 250,000 euros.

BOARDINGHOUSES ARE BUSINESS APARTMENTS FOR SHORT TERM RENTALS FROM 1 DAY TO 6 MONTHS.

Very often, a permanent contingent stops here, visiting annual exhibitions, or coming on business trips. This depends on the location of these apartments (eg Obersendling).

What is Boardinghouse can be read in our article HERE

STUDENT APARTMENTS ARE ONLY FOR UNIVERSITY STUDENTS OR STAFF.

Since there is an acute shortage of student apartments in Munich, there are 29 higher education institutions in the city, and the number of students has exceeded 120.000, so this real estate direction is doomed to success. The location of student apartments is the Schwabing district – the concentration of numerous universities and institutes in Munich, and also one of the most comfortable areas.

Our clients have a choice: to rent out their property themselves, or to involve a management company. Such a company will take care of all the concerns associated with the rental of real estate. In this case, the yield of apartments will be from 3.5 to 4%.

If the property owner plans to manage his apartment/apartments himself, then he/she may be able to increase its/their profitability to 4.3 – 7% by reducing costs. But it will be necessary to take into account many details that are not noticeable at first glance.

The exhibition featured a company dealing with interior equipment for hotels and boardinghouses.

In some cases, if you have to additionally equip the apartment (for example, with a set of dishes, cutlery, maybe an extra sofa), this company offers all the necessary equipment at a discount of up to 10% and with an installment plan of up to 6 years. With often missing interest rates.

A new direction in the development of profitable real estate is an impetus to development, and the next round will take place in 2019. We will look forward to next year’s MIM exhibition.

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Regina Borger

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