Purchase recommendation 2 condominiums in a 3-family house

Hello everyone,

the topic of investing money keeps coming up with us. This is because our income situation has changed significantly.

And time and again we end up with real estate, especially currently, since prices have already dropped a bit. So far, we have looked at several apartments, which for various reasons (purchase price significantly too high, others were faster, seller no longer wants to sell, heirs are not in agreement, etc. etc.) could not be purchased.

Now an offer has come up in our neighborhood that we are seriously considering.

It is a 3-family house from 2019. All 3 apartments are available for purchase individually or the entire house. All 3 seem financially a bit too much for us. But we could acquire the two upper apartments. The top one (Penthouse apartment) could also be an option for us for later own use.

Does it make sense to buy two of the apartments in a 3-family house or would you advise against it?

Thanks in advance for your opinions.

Why do two apartments work but not three? If you lose one, you always have someone interfering even if you have the majority.

Why do two apartments work but not three? When you have one less, you always have someone interfering with you, even if you have the majority.

The two apartments together are around 520k. We trust ourselves with that without having sleepless nights. The entire house is around 920k and that seems a bit too much for us..

The entire house is priced at 920k and that seems a bit too big for us..

But you then have three apartments. Your assets don’t actually change - more value but also more debt. It’s only a matter of mindset.

2019 and three apartments sounds like no reserves have been built up so far. So not like in a typical larger multi-family house, from which repairs can be paid. Is my assumption correct?

Two out of three apartments should practically always give you a majority at meetings - make sure that the third apartment becomes extremely unattractive for a buyer. If you decide to renovate, then the third apartment has to come along. Even if they don’t want to and basically don’t have the money for it.

But the big and only question that is really interesting to me is that of the return after taxes.

Feelings have no place in such a decision.

With one way you always have someone interfering, even if you have the majority.

Exactly the opposite. The third is practically without rights and always has to comply. They can express wishes, but the majority doesn’t care about them. That is a deal-breaker for me as a potential buyer.

But then you have three apartments. Your assets do not change at all - more value and more debt in return. It’s only in your head.

To be honest, I don’t know if a bank will finance the 920k for me. We have never requested such an amount before.

2019 and three apartments sounds like no reserves have been built up so far. So not as usual in a larger multi-family house, from which repairs can then be paid. Is my assumption correct?

The house was built as a 3-family house. At that time, each apartment was also offered for sale individually. The current owner acquired the entire house and lives in the ground floor and upper floor, and the top apartment is occupied by the parents-in-law. All are moving abroad together, hence the sale.

So, there is no community and no reserves so far.

But the big and only question that is really interesting for me is that of after-tax return.

I have not yet specifically calculated the after-tax return. Just the purchase price factor so far, which would be about 24 for the two apartments.

The return after taxes I have not calculated concretely yet.

For the factor, I am guessing a realistic 2.5%.