Expert tip: micro real estate as a way out of the housing shortage

"The average warm rent for an unfurnished shared apartment has risen from € 287 to € 372 per month from 2012 to 2018, an increase of just under 30 per cent. As front runner, cities like Munich, Berlin, Stuttgart and Passau prevail. [1] This, in turn, puts a heavy financial burden on students who already have low incomes anyway. Often, seekers are forced to move to a suburb and take a longer driveway or, of necessity, opt for another place of study with lower rents. The development of recent years shows that the demand for small, affordable and high-quality furnished residential units, the so-called micro or student properties, is steadily growing. The reasons for this are the increasing number of students and the associated lack of housing in cities as well as the trend of urbanization and the growing number of single households. At the same time, the demand for such objects far exceeds supply. With the purchase of such a property investors get through this mismatch the chance to invest their money future-oriented and sustainable.

Student real estate is a highly profitable investment as it typically incurs higher rents per square meter than traditional condominiums. Investors therefore benefit from significantly higher rental rates. Due to the currently low interest rates and the comparatively low investment amounts, student apartments are particularly suitable for young investors who are interested in fast and above all secure asset accumulation. Since these properties are suitable for resale, there is no locality for the investor. This is especially interesting for students who, at the beginning of their studies, often do not know exactly where to go in their lives. But for diversification, it is also worthwhile for experienced investors to think about this real estate trend. There is also the possibility that a professional administrator will take care of the building and rental management, thus largely eliminating the administrative burden for the investors - a particular advantage for students, since they can concentrate so completely on their studies.

The trend of urbanization will intensify in the next few years. This ensures a high demand for small, affordable and attractive housing units and a long-term secured rentability. Due to their functionality, student apartments are considered the real estate trend of the future. They stand for modern architecture and living comfort with functional space concepts at a small size. As furnished or semi-furnished apartments with usually less than 30 square meters, the apartments are also mostly modern in design. In addition, it is possible to equip them with up-to-date communication technology at will.

Particularly attractive for private investors, especially students, is the comparatively low level of investment. In addition, depending on the nature of the property, there is a possibility that the KfW subsidy may help to purchase a property with a loan, making such apartments even more affordable. Based on a thorough site analysis and needs assessment, the student apartment provides high security for investors. "


[1] Berlin Research Institute EMPIRICA: Rents for the winter term 2017 (2017).

(by: Sebastian Reccius, board member of DI Deutschland.Immobilien AG)

Sourche: DEAL-Magazin