Buy a two-family house and rent it out - How to structure the financing?

Hello, I alone want to buy a two-family house and rent out part of this house. The rentable part would be 80m² and the rest for myself about 120m². The purchase price of this property amounts to 200000€ since it is from a family member. The entire house is renovated/roof new/thermal insulation/heating new/electrics in good condition. My monthly net income is 2200€. Equity 10000. My question to you is how I should best structure the financing and whether the whole thing is even feasible. Best regards Runnerrider16

Hello Runnerrider16,

hard to answer. A few more details would be helpful (expected cold rent income for the 80 sqm; who would rent (stranger, family member (what is their financial situation), how much do you currently pay in rent yourself, how high is your current savings rate per month).

In my opinion, it will be tight.

Most of your equity will go towards incidental acquisition costs (property transfer tax, notary, etc.). Since you are buying from a family member, the broker fees will probably be waived (luckily for you). You probably want to furnish the house a bit (kitchen, etc.) - money will also be needed for that.

You should calculate with about 6% annuity (interest + repayment) for a loan. That means, for a loan of 200,000 euros, it is 12,000 p.a. or 1,000 per month.
Depending on age, this annuity can possibly be reduced a bit (= longer term) - but then after the fixed interest period there will still be a high sum remaining, which may have to be refinanced at a higher interest rate.

To what extent the bank considers potential rental income, I cannot say. It may also depend on the tenant (family member?) and the rental situation in the area (in Munich, due to the acute housing shortage, a quick re-rental can be expected when the tenant moves out - in Schleswig-Holstein???).

Two more tips:
- Besides the monthly credit burden, you also always have to plan for incidental costs (calculate roughly €2.50 per sqm). This cost share also burdens your budget (although you can at least pass most of these incidental costs on to the tenant for the rented part).

- Even if it is a purchase from a relative, you should have the house inspected by an expert beforehand so that you know exactly what you are getting into. This costs money again, but it will probably be the biggest investment of your life.

and additionally, regarding the extension to f-pNo: the question is whether the banks like to see you as an individual borrower. The only help is to ask directly at a consultant or a bank. Not all do it, that's for sure.

You might be lucky: Real estate transfer tax does not apply when buying from direct family members.

Ah - I didn't know that yet. You never stop learning.
On the other hand, I don't have any relatives who could have sold me a piece of land.

Hello

you are under no pressure. Have your house bank calculate it for you. Even if you rent within the family (which can also be a disadvantage) you usually have to bring more equity. I see that as the big problem. 10k with such a good single income is quite little.

First of all, thank you very much for the many suggestions. The cold rental income according to the rent index would be around €600 and it would probably be rented by a third party. Current rental costs do not exist. The house is renovated and ready to move in. Therefore, only a few costs for furnishing would be incurred. I am 26 with regard to the extension of the term. The equity would also still be available by then