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The Land Register: Important Basics for Buyers and Sellers
The land register is the be-all and end-all when buying and selling real estate. It documents ownership and encumbrances. Sound complicated? Don't worry! We explain the most important basics so that you are well prepared for your next real estate transaction. Do you need individual advice? Get in contact with us here.
The land register is the basis for secure real estate transactions and provides clarity about ownership. A current extract is essential to minimise risks.
The renting out of properties offers a lucrative income-generating option. By considering legal and tax aspects, profits can be maximised.
The professional support from Auctoa in the valuation and marketing of properties can optimise the rent and maximise the return. This leads to an increase in the property's value.
Land Register: An Essential Tool for Property Buyers and Sellers
The land register is a public register that provides information about the ownership and encumbrances of a property. It forms the basis for a secure property purchase and sale by clarifying legal relationships. A current extract from the land register is therefore indispensable for minimising risks. The land register is maintained by the relevant district court and is divided into various sections, each containing different information. A deeper understanding of the land register helps you to make informed decisions and protect your investment.
Land Leasing: A Lucrative Option for Owners
In addition to buying and selling land, land leasing presents an attractive opportunity to generate income. Whether as a long-term investment or for short-term bridging, leasing land offers flexibility and can be a stable source of income. It is important to consider the legal and tax aspects to achieve maximum profit. The valuation of the land plays a crucial role in setting a market-appropriate rental price. Leasing can be a sensible alternative to selling, particularly if you wish to benefit from future increases in value.
Auctoa supports you in valuing your property to determine the optimal rental price and maximise your yield. Our expertise in property valuation helps you make informed decisions and secure your investment. We offer you a comprehensive analysis and advice to achieve your goals.
Definition and Distinction: What do Letting and Leasing mean?
In the field of land use, it is crucial to distinguish between letting and leasing. Letting refers to the granting of property for use without the tenant being allowed to generate income from it. Typical examples include letting areas for storage purposes or as parking spaces. In contrast, leasing allows the lessee to use the property to make profits, such as by farming or setting up a restaurant. The choice between letting and leasing heavily depends on the nature of use and the owner's goals. The precise definition is established in the German Civil Code (BGB) and should be considered when concluding contracts.
Letting
Granting for use without deriving proceeds
Suitable for non-agricultural purposes
Leasing
Granting for use with deriving proceeds (e.g. agriculture)
Lessee may derive income from the property
The Lease Agreement with Inventory: Peculiarities and Responsibilities
A special form of leasing is the lease agreement with inventory. In this case, not only the property but also existing facilities and items (e.g. machinery, buildings) are leased. This is often the case in agriculture or gastronomy. The lessee assumes responsibility for maintaining the inventory and must return it in proper condition. It is advisable to make detailed arrangements regarding the inventory in the lease agreement to avoid disputes. The clear definition of responsibilities is crucial for a smooth leasing relationship.
Lessee's Maintenance Obligation
The lessee is generally responsible for the maintenance of the inventory. This includes repairs, maintenance, and possibly replacements. The extent of the maintenance obligation should be precisely defined in the lease agreement to avoid ambiguities.
Detailed Provisions Required in the Lease Agreement
To avoid misunderstandings and disputes, detailed provisions regarding the inventory should be made in the lease agreement. This includes an accurate inventory list, maintenance regulations, liability, and return. Professional advice is recommended when drafting the lease agreement.
Factors Influencing Rental/Lease Prices
The rental or lease price for a plot of land depends on various factors. The location is crucial, considering both the micro and macro location. The characteristics of the land (buildable, unbuilt, soil quality) also affect the price, as do its size and layout. The infrastructure and connection to public transport are important criteria as well. A professional assessment of all these factors is essential to achieve a market-appropriate price.
Location (Micro and Macro Location)
The micro location pertains to the immediate surroundings of the site, while the macro location covers the broader area. Both factors influence the attractiveness and thus the price of the land. Good connections to public transport and proximity to shopping facilities and schools are key criteria.
Characteristics of the Land (Buildable, Unbuilt, Soil Quality)
The buildability of a plot is a crucial factor for the price. An unbuilt plot offers more flexibility, while a built plot may already generate revenue. The soil quality is particularly important for agricultural land.
Size and Layout
The size and layout of the land influence the potential uses and, therefore, the price. A large, rectangular plot is generally easier to use than a small, irregular one.
Infrastructure and Connections
Good infrastructure and connections to public transport are crucial for the attractiveness of a property. Proximity to motorways, train stations, and bus stops enhances accessibility and increases value.
Using Rent Indexes and Property Market Reports
To determine a realistic rental or lease price, it is advisable to use rent indexes and property market reports. These documents contain information about usual prices in the region and can serve as a guide. The local rent indexes are issued by municipalities or interest groups and provide information about the average rental prices for comparable plots. Property market reports are compiled by appraisal committees and contain information on the sale prices of land in the area.
Lease Rent Calculation: Fixed or Revenue-Dependent Models?
When leasing land, the question arises whether to agree on a fixed or a revenue-dependent rent. A fixed lease rent offers planning security for both parties, while a revenue-dependent lease rent involves the lessee in the business's success. The choice of model depends on the type of use and individual preferences. For agricultural land, a fixed lease rent is common, while for catering businesses, a revenue-dependent lease rent might be advisable.
The Lease/Tenancy Agreement: The Foundation of a Stable Relationship
The lease or tenancy agreement forms the foundation of a stable relationship between landlord/lessor and tenant/lessee. It regulates the rights and obligations of both parties and should therefore be meticulously drafted. Essential contents include the exact description of the property, the duration of the contract, the amount of rent or lease payment, the provisions for operating costs, and the notice periods. For tenancy agreements lasting more than two years, a written form is required. A professionally drafted agreement minimizes the risk of disputes and provides clarity for both sides.
Essential Contents: Rights, Obligations, Duration, Rent/Lease Payment, Operating Costs
The contract should clearly and understandably regulate all essential contents. These include the exact description of the property, the duration of the contract, the amount of rent or lease payment, the provisions for operating costs, and the notice periods. The rights and obligations of both parties should also be detailed.
Written Form Required for Tenancy Agreements Over Two Years
Tenancy agreements made for a period of more than two years require a written form. This serves to protect both parties and ensures that all agreements are documented.
Notice Periods: What to Consider?
The notice periods are an important component of the lease/tenancy agreement. A distinction is made between indefinite and fixed-term contracts. Indefinite contracts can be terminated by complying with the legal or contractually agreed notice periods, while fixed-term contracts generally cannot be terminated before the end of the agreed term. Special regulations apply to allotment garden leases, as stipulated in the Federal Allotment Garden Act. The exact notice periods should be clearly defined in the contract.
Indefinite and Fixed-Term Contracts
Indefinite contracts can be terminated by complying with the notice periods, whereas fixed-term contracts generally cannot be terminated before the end of the agreed term. The notice periods can be legally or contractually agreed.
Special Regulations for Allotment Garden Leases
For allotment garden leases, special regulations apply as stipulated in the Federal Allotment Garden Act. For example, only indefinite contracts are permissible and the lease payment is capped.
Special Case Allotment Garden: Particularities and Limitations
The allotment garden lease represents a special case as particular statutory provisions apply here. For example, only indefinite contracts are permissible and the lease payment is capped. Additionally, there are limitations regarding the use of the allotment garden. The allotment garden primarily serves relaxation and the cultivation of fruits and vegetables for personal use. The exact regulations are laid out in the Federal Allotment Garden Act.
Only Indefinite Contracts Permitted
In the realm of allotment garden leases, only indefinite contracts are permitted. This serves to protect allotment holders and ensure that they can use their garden for the long term.
Lease Payment Cap
The lease payment for allotment gardens is capped and may not exceed a certain maximum amount. The amount of the lease payment is based on the locally customary rent for fruit and vegetable farming.
Income Tax on Rental Income
The income tax on rental income is an important aspect of property letting. Rental income falls under the category of letting and leasing income and is taxed at the personal income tax rate. Therefore, it is important to consider the tax implications and claim all relevant expenses. Professional tax advice can help optimise the tax burden.
Category of Letting and Leasing Income
Rental income falls under the category of letting and leasing income and is declared as part of the income tax return.
Taxation at Personal Income Tax Rate
Rental income is taxed at the personal income tax rate. The rate depends on individual income.
Deductibility of Costs
Landlords can deduct various costs from their rental income to reduce their tax burden. These include, for instance, broker fees, advertising costs, garden maintenance, and fencing maintenance. Depreciation options may also be used to reduce the tax burden. It is important to keep all relevant receipts and report the costs correctly on the tax return. A detailed list of deductible costs is advisable.
Broker Fees, Advertising Costs, Garden Maintenance, Fencing Maintenance
Broker fees, advertising costs, garden maintenance, and fencing maintenance are typical costs that landlords can deduct from their rental income.
Depreciation Options
Depreciation options can be used to reduce the tax burden. The amount of depreciation depends on the building's value and its useful life.
Basic Allowance and Its Implications
The basic allowance is an amount up to which no income tax is payable. It also applies to rental income. Taxes are only due when rental income exceeds the basic allowance. It is important to know the current basic allowance and factor it into tax planning. The basic allowance is regularly adjusted and should therefore be reviewed annually.
Targeted Marketing Strategy: Reaching the Right Audience
A targeted marketing strategy is crucial to reach the right audience and find the suitable tenant or leaseholder for your property. It is important to highlight the property's unique features and communicate the benefits to the respective target group. Professional marketing can speed up the leasing process and optimise the rental price.
Online Ads vs. Print Media
When marketing properties, the question arises whether online ads or print media are more effective. Generally, online ads are the better choice due to their greater reach and lower cost. Online portals enable the detailed presentation of the property and can appeal to a wide audience. However, print media might be sensible in certain cases, for example, when marketing allotments in the local area.
Credit Check: Minimising Financial Risks
A credit check is essential to minimise financial risks and ensure that the tenant or leaseholder can meet their payment obligations. Obtaining self-declarations and SCHUFA information provides insight into the financial situation of the interested party. A thorough credit check protects against payment defaults and unnecessary costs.
Obtaining Self-Declarations and SCHUFA Information
Obtaining self-declarations and SCHUFA information allows for a better assessment of the financial situation of the interested party and minimises the risk of payment defaults.
The Importance of Property Type and Designation in Tenant/Leaseholder Selection
The type and designation of the property play an important role in selecting the tenant or leaseholder. An undeveloped property is usually more appealing to commercial tenants, while a developed property might be suitable for residential purposes. The designation of the property determines what usage is permissible and what is not. It is important to consider the property type and designation in tenant/leaseholder selection to avoid conflicts.
Avoiding Unintended Perpetual Lease Agreements
A common mistake in the leasing of land is the avoidance of unintended perpetual lease agreements. If the lease contract is not clearly time-limited or is tacitly extended, a perpetual lease agreement can arise, which is difficult to terminate. It is therefore important to draft the lease contract carefully and to include a clear time limitation. Professional advice can help avoid this mistake.
Always Conclude a Written Contract
It is advisable to always conclude a written contract, even if it is not legally required. A written contract documents all agreements and minimises the risk of misunderstandings and disputes. The contract should cover all essential points, such as the description of the property, the duration of the contract, the amount of rent/lease, and the notice periods. A written contract provides clarity and security for both parties.
Seek Expert Advice: When Is Professional Support Useful?
Seeking expert advice is advisable in various situations, such as when drafting the lease contract, evaluating the property, or handling tax-related questions. A lawyer, tax advisor, or real estate agent can provide valuable support and help avoid mistakes. Professional support can pay off in the long run.
Considering Special Rights (e.g., Fishing, Hunting)
When renting or leasing property, it is important to consider special rights such as fishing or hunting rights. These rights can restrict the use of the property and should be clearly regulated in the contract. It is advisable to inform oneself in advance about existing special rights and to consider them in the contract. A detailed examination of the legal situation is recommended.
Conversion Land as Ideal Rental Properties
Conversion land, areas unsuitable for other uses due to contamination or topography, represent ideal rental properties for solar installations. Leasing such land makes it possible to utilise fallow areas effectively and contribute to the energy transition. In addition, leasing can generate long-term income. Professional advice helps assess the suitability of the land and optimise the lease agreement.
Minimising Shading for Maximum Yields
When leasing land for solar installations, minimising shading is crucial to achieve maximum yields. Trees, buildings, or other obstacles can reduce sunlight and thus impair the performance of the solar installation. It is therefore important to check for shading in advance and, if necessary, implement measures to reduce it. A detailed analysis of sunlight is essential.
Lease Models for Solar Installations: Fixed or Revenue-Based?
Various lease models can be agreed for solar installations. A fixed lease provides planning security, while a revenue-based lease involves the lessor in the earnings of the solar installation. The choice of model depends on individual preferences and risk tolerance. In revenue-based models, it is important to ensure transparent billing and regular monitoring. A clear agreement in the lease contract is essential.
Long-Term Income and Contribution to Environmental Protection
Leasing land for solar installations offers the opportunity to generate long-term income while also making a contribution to environmental protection. Solar installations produce clean electricity and reduce reliance on fossil fuels. Leasing conversion land for solar installations is therefore a win-win situation for both the lessor and the environment. A sustainable investment in the future.
Summary of Key Aspects
The rental of property offers an attractive opportunity to generate income. However, it is important to consider the legal and tax aspects and seek professional advice. Distinguishing between renting and leasing, correctly drafting the rental/lease agreement, optimising the tax burden, and targeted marketing are crucial factors for success. Careful planning is essential.
The Role of the Estate Agent: Added Value for Landlords and Lessors
The estate agent can provide added value for landlords and lessors. They have the necessary expertise to determine the rental/lease price, draft the contract, and manage the marketing. Additionally, they can assist in selecting the tenant/lessee and conduct a credit check. The professional support of an estate agent can simplify and optimise the rental process.
Call to Action: Professional Advice for Your Individual Situation
Renting out property offers you the chance to optimise the use of your capital and generate long-term income. Whether it involves agricultural land, commercial spaces, or leasing for solar panel installations, the possibilities are diverse. To fully realise the potential of your property and avoid legal and tax pitfalls, professional advice is indispensable.
Auctoa offers you comprehensive advice and support on all questions regarding property rental. We help you determine the optimal rental or lease price, find the right tenant or lessee, and draft a legally secure contract. Our expertise in property valuation and marketing guarantees you maximum success.
Take advantage of the opportunity now and let our experts advise you. Contact us today to discuss your individual situation and plan the next steps. Visit our website for more information and arrange a non-binding consultation. We look forward to accompanying you on your journey to becoming a successful landlord or lessor. Contact us now!
The Immobilien Direkt Professor GmbH offers information and services related to the rental and leasing of properties.
ImmobilienScout24 provides information on aspects of property rental, from legal basics to tax optimisation.
123Makler offers a platform and information for landlords, including services for property rental.
Milk the Sun provides information on leasing properties for solar installations and assists in the optimal use of conversion areas.
What is the land register and why is it important?
The land register is a public register that provides information about the ownership and encumbrances of a property. It is important to establish clarity about legal relationships and minimise risks when buying or selling real estate.
Where is the land register kept and how can I gain access?
The land register is managed at the competent district court. You can gain access if you can prove a legitimate interest, such as being a prospective buyer or owner.
What information does the land register contain?
The land register contains information about the owner, the size of the property, encumbrances (e.g. mortgages, land charges) and restrictions (e.g. rights of way).
What is the difference between renting and leasing a property?
With renting, the property is made available for use without the tenant being allowed to generate income from it. With leasing, the lessee is allowed to use the property for profit, for example, through agriculture.
What factors influence the rental or lease price of a property?
The location (micro- and macrolocation), the characteristics of the property (buildable, undeveloped, soil quality), the size and layout, and the infrastructure and connectivity influence the rental or lease price.
How can I optimise the tax burden when renting out a property?
You can deduct various expenses from your rental income, such as brokerage fees, advertising costs, garden maintenance and fence upkeep. Depreciation options can also be utilised.
What are conversion areas and why are they ideal for solar panels?
Conversion areas are sites unsuitable for other uses due to contamination or topography. They are ideal for solar panels as they provide valuable use of derelict land and make a contribution to the energy transition.
What role does a real estate agent play in renting a property?
A real estate agent can assist in determining the rental/lease price, drafting the contract, and marketing. Additionally, they can help in selecting a tenant/lessee and conducting a credit check.
