Numerous developers and investment brokers see nursing care real estate as a lucrative capital investment for investors. They forecast high returns of four percent and more for up to 25 years. Stiftung Warentest investigates this forecast and examines whether investing in a nursing care apartment is actually as lucrative and profitable as promised. What profits can actually be made with nursing care real estate? What else should investors look out for before buying a care property?
For example, Stiftung Warentest first points out that the return promised by developers and investment brokers is a gross return. Investors must bear in mind that around 0.5 percent must be deducted for ancillary costs from the four percent promised for the return, for example. Even if rents are rising steadily, buyers must be aware that a care property in particular will quickly lose value.
This is because common areas are heavily used by residents and age quickly. In addition, new laws constantly impose new requirements on the equipment. In most cases, the property requires extensive modernization after a few years. Another risk factor is the economic success of the operator. If he is threatened with insolvency, this can mean that the rent is not paid. It is impossible to predict when and whether a new operator will be found and whether the property will still be lucrative for resale. Especially not when outpatient care services and modern nursing homes are increasingly in demand in the region.
Source: Stiftung Warentest
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