Opportunities in Berlin?

The property market in Germany has experienced very little joy over the past couple of years, however things could now be about to change, under new Chancellor Angela Merkel.

Some reports have it that an increasing number of British investors have recently been buying up undervalued residential property in Berlin, where property prices in some parts of the city are reported to be as low as £500 a square metre. There is also the added incentive that approximately only 12% of the locals are owner-occupiers.

Norbert Klink who owns a German based property company says: "Prices in eastern Europe are largely based on future expectations." But he claims that his native Berlin is different and says: "Even if everything stays as it is now, you will get a good return on your investment."

NAEA warn investors buying Spanish property

Some investors buying up property in Spain could trip up over old tax loopholes, according to the National Association of Estate Agents (NAEA).

For years now, Spanish property prices have often been misquoted in order to avoid high tax payments. Commenting on this fact, Ian Tonge, chair of the NAEA International Working group says: "This means that if the local authority wants to purchase the land today, as has been highlighted in recent cases in Valencia, proving how much it is worth can be very difficult."

"Historically, people have been reluctant to put in the full price on their documents because that would force them to pay more tax than the gain they had made on the property," he continues. "If their property is then needed for road widening purposes, for example, they will only receive the government's recorded value on it, and will be unable to prove that they are owed more. Purchasers in Spain must be careful to declare the true value of their property to protect themselves."