Bestandsimmobilie (existing)

Yield versus depreciation

The defining trade-off against Neubau:

Bestand typically trades at a discount per square metre to equivalent-location new build, often twenty to forty percent lower, varying by city and segment. That discount feeds directly into gross Mietrendite, which is usually higher.

The AfA rate is two percent linear over fifty years (for stock built before 2023), against three percent linear, or the front-loaded five percent degressive route, for qualifying Neubau. The depreciation deduction per year is smaller; the cashflow it shelters is, in many cases, larger.

In after-tax terms, Bestand often produces stronger cashflow during the holding period and a less back-loaded return profile. Neubau often produces stronger tax shielding and more potential exit-side appreciation. Neither is universally better; they fit different goals.

The renovation question

A specific feature of Bestand worth understanding: the option to add value through targeted renovation and modernisation.

Two distinctions matter:

Sanierung versus Modernisierung. Sanierung is the broad category of substantive repair and updating. Modernisierung is the narrower legal category that allows costs to be passed on to the tenant through Modernisierungsumlage, up to eight percent of qualifying costs per year, capped at €3 per square metre over six years, subject to formal notification rules.

Reparatur versus Herstellungskosten. For tax purposes, ongoing repairs are fully deductible in the year incurred. Substantial improvements that create new value, replacing a roof, adding insulation, converting space, may need to be capitalised and depreciated over the building's life. The line between the two is well-defined in case law; getting it wrong is one of the more common Steuererklärung errors.

For investors with the operational appetite, the value-add available through skilled renovation is one of the genuine differentiators of Bestand, both in terms of tax-deductible cost basis built up and in terms of rent uplift achievable through Modernisierungsumlage.

The maintenance reality

Older buildings have older systems. The cost line items most often surprising first-time Bestand owners:

Heating system replacement. The Gebäudeenergiegesetz sets requirements that affect older heating systems, particularly pre-1990s oil and gas systems approaching end-of-life. A full system replacement for a building commonly runs well into five or six figures, and a single unit's share of that, levied through the WEG, can still be substantial. The timing is often not the owner's to choose.

Roof, façade, and major shared systems. These are typically WEG decisions, paid from the Instandhaltungsrücklage where reserves are sufficient and from special assessments where they are not. Reviewing the WEG's reserve balance and planned works is a critical pre-purchase due-diligence step.

Window and insulation upgrades. Often driven by energy efficiency requirements, sometimes by tenant comfort considerations, occasionally by Mietspiegel category requirements. Costs and timing vary.

When Bestand tends to fit

The patterns in cases where Bestand turns out well:

• The investor has done thorough due diligence on the building, including heating system, WEG reserves, and planned major works
• The reserve fund covers a realistic worst-case maintenance scenario
• The strategy is cashflow-oriented or genuinely value-add (renovation/modernisation), not appreciation-by-default
• The depreciable base has been carefully allocated between building and land, Bestand allocations are more variable than Neubau and worth professional input
• The maintenance posture is active rather than reactive, owners who plan upgrades tend to outperform owners who fix what breaks

What comes next

A specific Bestand sub-category deserves its own treatment, because the tax mechanics are dramatically different: Denkmalimmobilien, where heritage protection unlocks the most aggressive depreciation schedule in German tax law.