1. What is the Breakeven Calculation?

The breakeven calculation determines how many years it takes for buying a property to become financially advantageous compared to renting in Germany, considering all costs involved.

2. How Does the Calculator Work?

The calculator uses the breakeven formula:

Where:

• Buy Costs — Total upfront costs of purchasing (down payment, fees, taxes)
• Rent Costs — Initial rental costs (deposit, agent fees)
• Annual Difference — Yearly cost difference (mortgage payments + maintenance - rent)

Explanation: The equation calculates how many years it takes for the cumulative savings from buying to offset the higher initial costs.

3. Importance of Breakeven Analysis

Details: Understanding the breakeven point helps make informed decisions about whether to rent or buy based on your expected duration of stay and financial situation in Germany.

4. Using the Calculator

Tips: Enter all costs in EUR. Buy costs should include all purchase expenses. Annual difference should reflect the net yearly cost difference between owning and renting.

5. Frequently Asked Questions (FAQ)

Q1: What typical buy costs should I consider?
A: Include purchase price, notary fees, property transfer tax (3.5-6.5% in Germany), and agent fees (typically 3.57-7.14% including VAT).

Q2: What's included in annual difference?
A: Mortgage interest (not principal), property taxes, maintenance (1-2% of property value/year), insurance, minus what you'd pay in rent.

Q3: What's a good breakeven period in Germany?
A: Generally, buying makes sense if you plan to stay 10+ years, but this varies by location and market conditions.

Q4: Does this account for property appreciation?
A: No, this is a simplified model. For complete analysis, consider potential property value changes and investment alternatives.

Q5: How does German tax system affect this?
A: Germany allows deducting mortgage interest for owner-occupied properties (Eigenheimzulage), which can improve the breakeven point.