Buying an apartment building in Düsseldorf: prices, rental yield, checks

01Check tenant list: Target rent is not a sure inflow of money

Compare the agreed net rent for each unit with the amount actually received. Keep a separate record of vacancies, arrears, usage and known agreements. A fully rented description in the exposé does not prove either punctual payment or permanently unchanged income. Check the documents with redacted personal information that is not required for the decision.

Calculate a second scenario with lost rent and higher costs that cannot be passed on to tenants. Do not count a potentially vacant unit both as generating full rent and as providing immediate sale proceeds. The rental-yield calculator shows how your assumptions affect yield; it does not confirm that a rent increase is lawful.

02Calculate maintenance, financing and liquidity separately

The year of construction alone cannot establish the condition of a roof, heating system or facade. Prioritise known work by urgency and obtain reliable estimates of scope and cost. A separate reserve allowance is a scenario assumption, not a confirmed renovation quote. Have technical risks assessed before buying.

Before arranging finance, use the additional purchase costs calculator and equity calculator. For later decisions, consult sell-or-rent liquidity comparison and the Property management directory Düsseldorf.

03The market for apartment buildings in Düsseldorf

Multi-family homes are sold much less frequently in Düsseldorf than condominiums. Some of the properties change hands without being advertised publicly - via brokers, banks or directly between owners.

The Düsseldorf valuation committee publishes how many apartment buildings were sold in the previous year and at what prices in the property market report. It also contains the key figures with which you can classify an offer: gross income multipliers and property capitalisation rates. The report is available via BORIS NRW; pay attention to the current edition.

Research current offers through Buy a house in Düsseldorf (research directly from suitable providers). Privately sold apartment buildings are rare. Buying without an agent saves the commission but leaves you responsible for checking the property. The statutory commission-sharing rule in § 656c BGB does not apply to apartment buildings; commission is negotiable.

04Understand the purchase price factor and property capitalisation rate

Two key figures are sufficient for an initial classification: the purchase price factor from the buyer's perspective and the property capitalisation rate from the appraiser's perspective.

A “good” purchase price factor is one that fits the market and the property. Compare the offer factor with the gross income multiplier that the valuation committee shows for similar houses - depending on location, year of construction and size. If the offer is significantly higher, there must be a reason for this: for example rents below market level, which are allowed to rise, or a newly renovated building.

The property capitalisation rate is the interest rate that buyers actually expect on the market. Appraisers use it in the income value method according to the Real Estate Valuation Ordinance (ImmoWertV). The lower the interest rate, the higher the value for the same rent.

05Real estate guideline MFH per location

Official property reference values are averages per square meter of living area for a typical building in a particular location. The local valuation board derives them from actual purchase prices. The BORIS NRW: official market information page shows which property types are covered and the published values.

For apartment buildings, a price per square meter is only useful as a plausibility check. Two houses with the same living space can be worth very different amounts if one achieves market rents and the other has been rented below standard for decades. Yield counts when making a purchase decision.

06Return calculation using an example

The gross rental yield is quick to calculate, but it doesn't mean much. The net rental yield is more meaningful: it takes into account the additional purchase costs and the costs that you as the owner bear yourself.

The financing costs and taxes are not yet taken into account here. With debt capital, the return on your equity changes - upwards if the interest rate is below the net rental yield, otherwise downwards.

Rent index rent vs. actual rent: Assess each apartment using the information about the rent index from the city. Where actual rent is below local comparative rent, gradual increases may be possible under § 558 BGB, subject to the cap and at least 15 months since the previous increase. Higher actual rent can be a risk: income may fall on re-letting.

Rent cap for new rentals: In rent-control areas, re-letting rent may exceed local comparative rent by no more than 10% (§ 556d BGB). The Tenancy law basics and comparative rent explains Düsseldorf’s rules, duration and exceptions.

07Due diligence: rental agreements, building structure, energy (GModG)

Before buying an apartment building, check it in three directions: legally, technically and energetically. Request the documents early.

1. 1Rental agreements and tenant listAll contracts with addenda, rental start date, current rent, graduated or index agreements, deposits, arrears, ongoing disputes and terminations.
2. 2Operating costsThe latest statements show whether the costs are passed on, what can be passed on - and which costs remain with the owner.
3. 3Building structureRoof, facade, windows, basement and moisture, pipes for water and electricity, heating. Have a building expert inspect a house of this size.
4. 4Energy according to GModGWhen selling, a valid energy certificate is generally required (§ 80 GModG). The retrofitting of the top floor ceiling is based on Section 35 GModG including its requirements and exceptions. The previous exchange obligation according to § 72 GEG is no longer applicable in the current version; this does not result in a general statement about the admissibility or economic viability of a particular heating system. Have your heating, fuel requirements and renovation needs professionally checked before purchasing.
5. 5Land register, building encumbrances, permitsThird-party rights in Section II, register of public-law building obligations, contaminated-land register and building permits — including for converted attics and basement apartments.

08Splitting into condominiums: what is allowed

In principle, an apartment building can be divided into separately owned apartments. You need a declaration of division through the notary and a certificate confirming that the units are self-contained (Abgeschlossenheitsbescheinigung) from the building authority. The division is entered in the land register.

In tight housing markets, the federal states can make the conversion of rental properties into condominiums subject to approval (§ 250 BauGB). Before you buy, check whether such a regulation applies in North Rhine-Westphalia and includes Düsseldorf - you can find the current status at recht.nrw.de, information is available from the building inspectorate. If the house is located in the area of a conservation statute (§ 172 BauGB), an additional permit may be necessary.

1. 1Tenants' right of first refusalIf a rented apartment is sold for the first time after conversion, the tenant has a right of first refusal (§ 577 BGB).
2. 2Termination blocking periodIf a rented dwelling is converted to condominium ownership after the tenancy begins and is then sold, the waiting period under § 577a BGB may apply: generally three years from the sale, or up to ten years in areas designated by state regulation. Check the specific circumstances and local regulation before planning to terminate the tenancy for personal use.
3. 3Tax consequencesAnyone who sells multiple units in a short period of time can be considered a commercial real estate dealer. Clarify this with your tax advisor in advance.

09Taxes: depreciation, maintenance costs, 15% limit

Rental income is subject to income tax. From this you deduct interest, management costs and depreciation on the building. You cannot write off the land - so divide the purchase price in the contract or with the help of the Federal Ministry of Finance.

In the example above, 60% of the total investment is assumed to be in the building, i.e. €1,338,840. If it was built between 1925 and 2022, this results in a depreciation of €26,776.80 per year. For new buildings there is also a degressive depreciation for a limited time (Section 7 Para. 5a EStG); please contact your tax advisor to find out whether your property meets the requirements.

Whether repairs are immediately deductible maintenance or form part of acquisition or construction costs needs separate assessment. A gain from selling a privately held property after more than ten years generally falls outside § 23 EStG. Business assets and commercial property dealing follow different rules; have your circumstances assessed by a tax adviser.

10Financing for investors

Banks finance apartment buildings based on rental income. They check whether sustainable rent covers interest and repayments, and determine their own mortgage lending value, which is usually below the purchase price.

1. 1Equity for additional costsBanks are reluctant to finance property transfer tax, notaries and brokers. Plan for them from equity.
2. 2Debt service versus net operating incomeCompare annual loan payments with net income, not gross rent. Allow for vacancies and repairs within that budget.
3. 3Fixed-interest period and repaymentA long fixed interest rate protects against rising interest rates. After ten years, you can still cancel a loan with a longer commitment (§ 489 BGB).

For larger loans, some banks require a valuation report. The guide to market value reports explains which type is appropriate.

11Apartment building in the surrounding area: Krefeld, Duisburg, Wuppertal, Mönchengladbach

In neighboring cities, the purchase prices per square meter are usually lower than in Düsseldorf. The gross return can therefore be higher. But check whether the rent is just as secure there: vacancies, tenant changes and maintenance backlogs are more important when the rent is lower.

Each city has its own rent index and property market report. Check local features: many houses in Wuppertal and Krefeld are listed buildings, and past mining activity must be checked in parts of Duisburg.

12Find property management

If you are not nearby or own several rental buildings, consider a rental property manager. They handle rent payments, operating-cost accounts, repairs and changes of tenant. If the building is divided into condominiums, the owners’ association also needs a manager for its common property.

Before buying, ask whether the existing manager will remain and on what terms. Compare quotations, services and references. For Düsseldorf providers, see Property management Düsseldorf (research directly from suitable providers).