You have inherited an apartment in Berlin and are faced with the question: sell or rent? This decision has far-reaching financial consequences. We provide you with the crucial key figures and a clear analysis, so you can make the right choice for your assets based not just on instinct, but on facts.
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The topic briefly and concisely
Sell if you need quick liquidity and the 10-year speculation period has expired, allowing you to benefit from selling prices around €5,388/m² in Berlin.
Rent for long-term wealth building if you want to achieve a net rental yield of over 3.5% and take advantage of tax benefits like the deduction of maintenance costs.
Always first check your personal inheritance tax allowance (e.g. €400,000 for children) and the speculation period, which depends on the decedent's purchase date.
Inheriting a property in Berlin is a significant event, often accompanied by emotional and complex financial questions. There is a lot of uncertainty: Is now the right time to sell to take advantage of the high prices? Or does a long-term rental in one of Europe's most dynamic rental markets promise a more secure return? Many heirs fear making a wrong decision that could cost them thousands of euros. This article guides you through the decisive factors. We analyse the current market situation, highlight the tax pitfalls such as inheritance tax and capital gains tax, and compare the potential returns of renting with the quick liquidity advantages of selling. This gives you a well-founded, data-driven basis for your strategy.
In brief: Your options at a glance
The decision between selling and renting an inherited apartment in Berlin depends on your personal financial situation and long-term goals. A sale offers immediate liquidity, while renting generates a steady, passive income stream. Both options have specific tax implications and costs that need to be carefully considered.
Sale: The average sale price for apartments in Berlin is currently about €5,388/m². Selling gives you quick liquidity, but may trigger speculation tax if the deceased owned the apartment for less than 10 years.
Renting: The average asking rent for existing properties is around €16.79/m². This ensures ongoing income and allows for value appreciation, but also involves administrative effort and maintenance costs of approximately €1/m² per month.
Taxes: For children, there is an inheritance tax allowance of €400,000. The speculation tax does not apply if the property was held by the deceased for over 10 years or was used for personal residential purposes.
Return: A solid net rental yield should be between 3.5% and 4% to be considered an attractive investment.
These figures form the basis for the following detailed analysis, which will help you develop the strategy that suits you best.
Market analysis Berlin: Stable prices as a solid basis for decision-making
The Berlin real estate market remains robust in 2025, providing a reliable foundation for your decision-making. The average apartment prices have stabilized at around €5,388 per square metre, which represents a slight increase of approximately 2% compared to the previous year. In prime locations like Charlottenburg-Wilmersdorf, prices of up to €8,628/m² are being achieved. This stability indicates that a sale can currently yield an attractive profit. At the same time, population growth of 3.5% since 2018 is driving demand for rental properties. The vacancy rate is extremely low at 0.3%, which suggests a high level of rental security. The average cold rent for existing apartments climbed to €13.03/m², an increase of 5.5% year-on-year. Especially in new builds, high rents of €22.17/m² are achievable. These market data show: Both selling and renting are currently economically viable options. The question is, which better suits your goals. An accurate valuation of your inherited apartment is the first step to fully exploiting its potential. The next section explores the benefits and costs of a direct sale.
The Sale: Creating Quick Liquidity and Clear Conditions
Selling an inherited apartment in Berlin is often the most direct way to release assets and dissolve complex inheritance communities. With a current average price of €5,388 per square meter, an 80-square-meter apartment can generate proceeds of over €430,000. This amount is then at your disposal—whether for other investments, debt repayment, or fulfilling personal desires. Another advantage is the avoidance of future risks, such as rental defaults or increasing maintenance costs. The costs of the sale, such as notary and land registry fees (approximately 1.5% of the purchase price), are generally borne by the buyer. Since 2020, broker fees are shared between the buyer and seller. However, before taking this path, you should examine the tax aspects. A detailed checklist for the sale helps keep all steps in view. The tax conditions are crucial and will be examined in more detail below.
The Rental: Utilising Long-Term Wealth Building with Tax Advantages
Renting out your inherited Berlin apartment can be an attractive strategy for long-term wealth building. With an average rent of €13.03/m², an 80-square-metre apartment generates an annual net rent income of over €12,500. This creates a continuous cash flow. Additionally, you benefit from the potential increase in the property's value, which has been significant in Berlin in recent years. A crucial advantage of renting out is the tax deduction opportunities. The following costs can be claimed as deductible expenses, thus reducing your tax burden:
Maintenance costs: Budget approximately €11.50 per square metre annually, which can be fully deducted.
Depreciation (AfA): You can annually depreciate 2% of the acquisition or production costs of the building.
Administrative costs: Fees for property management are also deductible.
Financing costs: If you take out a loan for renovations, the interest is tax-deductible.
For rented properties, the taxable value for inheritance tax is generally reduced by 10%. This can make a substantial difference. Before deciding, you should determine the realistic rent for your apartment. But what taxes are actually incurred under both options?
Tax Focus: Navigating Inheritance and Speculation Taxes Correctly
Regardless of whether you decide to sell or rent out the inherited apartment in Berlin, two types of taxes are crucial. Inheritance tax is due as soon as you accept the inheritance. Direct children benefit from a high allowance of €400,000 per parent. Spouses can even inherit up to €500,000 tax-free. If the market value of the property, determined by the tax office, is below this amount, you will not have to pay inheritance tax. An inheritance tax calculator can provide an initial guide here. The second important tax is the speculation tax. This only applies if you sell the apartment within ten years of the original purchase by the deceased. Thus, the time limit does not start with the inheritance event. For instance, if the deceased purchased the apartment in 2012, you can sell it tax-free from 2023 onwards. There is an exception for personal use: if the apartment was occupied by the deceased or yourself during the year of sale and the two preceding years, the tax is also waived. A precise check of these time limits is essential to avoid an unnecessary tax burden of up to 45% on the profits. Once the tax fundamentals are clarified, the direct comparison of the two options follows.
Cost-benefit analysis: Which option is worthwhile for you?
Let's directly compare the two options to make the best financial decision for your inherited apartment in Berlin. The choice largely depends on your individual needs: Do you need capital in the short term, or are you aiming for long-term passive income? A net rental yield of at least 3.5% is considered a good benchmark for a worthwhile investment. Let us consider an example of an 80 m² apartment:
Scenario A: Sale
Sale proceeds (at €5,388/m²): €431,040. After deducting potential agent costs (approx. 1.5%) and without capital gains tax, a large sum is available to you. This is ideal for paying off debts or settling with an inheritance community.Scenario B: Rental
Annual cold rent (at €13.03/m²): €12,508. You need to deduct non-allocable costs and the maintenance reserve (approx. €960/year at €1/m²/month). The remaining amount of over €11,500 must be taxed at your personal income tax rate.
Renting is more capital-intensive and requires ongoing management but protects your assets from inflation and allows them to grow. A comparison calculator for sale or rental can provide individual figures. So how do you find the final strategy?
geerbte-wohnung-in-berlin-verkaufen-oder-vermieten
The decision to sell or rent out an inherited apartment in Berlin is not purely emotional. As the analysis shows, current market data and fiscal conditions provide a clear basis for decision-making. Selling at current prices around €5,388/m² is advisable if you need quick liquidity or wish to avoid the administrative burden. Renting out at rates above €13/m² and with a yield of over 3.5% is ideal for long-term wealth accumulation and generating passive income. Check the ten-year speculation period and optimally utilize your inheritance tax allowance of €400,000 as a child. The key lies in an objective assessment of the property and an honest analysis of your personal financial goals. A data-driven evaluation from Auctoa or a conversation with our ImmoGPT can help you eliminate the last uncertainties and set the course for your financial future correctly. Make the choice that is not only right for today but also for ten years down the line.
Additional useful links
The Statistische Bundesamt offers tables and information on house and land prices in Germany.
The Deutsche Bundesbank provides an indicator system for the residential real estate market.
The Senate Department for Housing in Berlin offers comprehensive information on the Berlin rent index.
Wikipedia provides an overview of the real estate market in Germany.
The Expert Committee for Property Values in Berlin publishes detailed market analyses.
Information on standard land values in Berlin can be found from the Expert Committee for Property Values in Berlin.
The German Tenants' Association is an important representation for tenants and provides comprehensive information.
The Federal Ministry of Finance provides detailed information on inheritance and gift tax.
FAQ
Do I need to personally fulfil the 10-year period for capital gains tax on an inherited property?
No, the deadline does not start with the inheritance event. The decisive factor is the purchase date by the testator. If they acquired the apartment more than 10 years ago, you can sell it immediately tax-free.
What happens if the value of the inherited apartment exceeds my inheritance tax allowance?
You only need to pay tax on the amount that exceeds the tax-free allowance. For example, as a child with a tax-free allowance of €400,000, you inherit a property worth €450,000. Only the difference of €50,000 is taxed at your personal inheritance tax rate (starting at 7% for children in tax class I).
Can I deduct the costs of renovating the inherited apartment from my taxes?
Yes, if you rent out the apartment. Then, the renovation costs are considered advertising expenses and reduce your taxable income. In the case of a sale followed by personal use, this is generally not possible.
How do I determine the exact value of my inherited apartment in Berlin?
Online tools such as Auctoa ImmoGPT can be useful for an initial assessment. For a binding valuation that is also recognised by the tax authorities, you should obtain a professional market value appraisal from a certified expert.
What is an inheritance community and how does it affect my decision?
An inheritance community arises when there are multiple heirs. All decisions, including selling or renting, must be made collectively. Selling is often the simplest solution to fairly divide the inheritance and avoid conflicts.
What is a realistic yield for a rental apartment in Berlin?
While the gross yield often exceeds 4%, the net rental yield is more meaningful. After deducting all non-recoverable costs and reserves, a net yield of 3.5% to 4% in Berlin is considered solid and desirable.
