In a newly constructed apartment, you know your costs of living
The costs of living are easy to estimate for a new residential property. Unexpected costs are unlikely, as new apartments:
- do not involve costs of renovation and repairs
- use new and energy efficient home appliances
- have modern technical building systems
- have a particular focus on energy efficiency
When discussing the price of an apartment, the two key terms are the apartment's sales price and its debt-free price.
- The sales price is the amount the buyer pays the seller for the shares in the housing company that are being sold.
- The debt-free price is the sales price plus the apartment's outstanding share of the housing company loan.
An example price breakdown:
Sales price EUR 182,000 + Share of housing company loan EUR 120,000 = Debt-free price EUR 302,000.
Buying a newly constructed apartment adds flexibility to financial planning
When you choose to buy a home in a newly constructed residential property, you can decide whether to buy the apartment using your own funding or by utilising the housing company loan. If the apartment building is located on optional leasehold land, you can choose whether to pay off the redemption of ground rent immediately at the time of the purchase transaction or pay it off in monthly instalments.
Newly constructed residential properties give you the opportunity to live in your own apartment with less capital required. The predictability and flexibility of the costs make financial planning easier, which is particularly valuable for young people and those buying their first home.