| Castles
For Sale In Eastern Germany |
| By Helga
van Horn |
| You may
have read my articles in the past about castles for sale in the eastern
states of Germany which have been run down during the Communist era of
East Germany. Well, it's some time since my last article appeared
and since things change over time, an up-date is in order.
Yes, these
castles and manor houses are for the most part still a good buy if you
compare them to prices charged for similar properties in other parts of
Europe.
Even if
prices have gone up, and the low dollar too contributes further to
a price increase, they still represent a good investment. If you always
wanted to own a castle, then by all means you will be paying less if you
buy a castle in this region of Germany. |
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Such castles
are not as abundant anymore as they once were, but there are still hundreds
awaiting a buyer and renovation, including some which have been renovated
in part where the owner has run out of funds and now has to sell at a reasonable
cost to get rid of them.
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These are often
a good buy because of the amount of money that has been already invested,
but to resell quickly, the owner has to sell at less than the current market
price.
Such properties
are particularly good for those investors who want to take their time renovating. |
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| It is always
the outside of a castle or manor house which has to be renovated within
a certain amount of time, a requirement that is usually stipulated
in the purchase contract. What happens on the inside is usually up to the
buyer, thus he/she can take as long as they want, or even do the work themselves.
Subsidies
too are not as generous anymore as they used to be. The Denkmalschutz
the German state historical preservation department, has, for the most
part, run out of money and subsidies from this source are extremely rare.
A castle would have to be of tremendous historic importance to obtain subsidies
from this department. Subsidies that are still available are those
offered by the municipality where the castle is located. But these grants
are usually much smaller, 20% perhaps. However, an investor can apply for
a VAT tax refund, the 16.5% which he pays for all services and materials.
This amount can be considerable, for instance if an investor pays 500,000
euros for renovation of a castle, he is refunded 82,500 euros. |
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| In many
cases where municipal subsidies are low, it may be more advantageous to
simply forget about them since then, he can hire low cost labor. For
instance a buyer can hire renovation companies who bid low because they
are using Polish labor which is considerably cheaper than German labor.
If subsidies are awarded, the job has to be published in local newspapers
for open bidding and German labor has to be used. Thus it often turns out
that more is saved by foregoing the subsidies.
I often
have inquiries who think that they can buy a castle with awarded grants.
That is not so. The castle has to be bought with ones own money first.
Subsidies are paid out against renovation bills.
An exception
to all the above are properties which are located along the German-Czech
border. The area is in a region dedicated as an EU (European Union)
joint development region called "Euro Region Erzgebirge". The purpose
for this is to further and develop business between the two countries.
The only requirement is that a castle or manor house must be a business,
a hotel, seminar center or B&B etc., so that tourism can be jointly
promoted. |
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| The subsidies
are 50% of all costs excepting the purchase price, but including the furnishings.
Readers
may be interested that I myself together with my husband and 3 other partners
have bought a beautiful Baroque castle dating to 1730. This has given
me an even greater knowledge of what is involved when one gets involved
with such a venture. It is, to put it bluntly, a big job, nearly impossible
if one wants to tackle it by him or herself, particularly if there is a
language barrier. Fortunately we had and have our associate Mr. Manfred
Pawlik to see us through. The ten to fifteen thousand euros we are paying
to have all paperwork and red tape taken care of for us, is worth every
cent. We would have paid far more had we have to travel back and forth
and spend time in hotels to handle something like this ourselves. With
Mr. Pawlik handling everything for us, it was and still is smooth sailing. |
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| It is also
important to hire an accountant or tax adviser after beginning renovation
who can handle all tax matters including the VAT refunds. Don't try to
do it yourself, as anywhere, the tax collectors make their forms and rules
and regulations as complicated as possible.
Something
to keep in mind for those who receive subsidies is that renovation has
to be historically correct. For instance the regulation for the Torhaus
Manor which is a property we bought along with the castle, the stipulations
for the roof read: "The roof has to be done in natural red ceramic
beaver tail tiles in the Saxon format of 15.5 cm x 36.5 cm." A sample
tile has to be shown to the historic preservation department before installation.
The list goes on, everything has to be historically correct. We can not
use stone that has been artificially tinted, but must use stone in its
natural occurrence. Floors have to be original tiles or so-called "Dielen"
wooden boards fitted so tightly together that the seams are nearly invisible.
Of course, after renovation we could install carpeting if we would chose
so, but who would want to with floors that are this beautiful. Area rugs
will look far more attractive exposing the wooden floors which add warmth
and beauty to a room. These are just a few of the many things we have to
observe, however, the end result will be a magnificent castle.
As always
I am happy to answer anyone's questions regarding buying and restoring
a historic castle or manor house. To see what is presently available
go to our web site www.poshjourneys.com
and click on "Castles as an Investment." There are more, of course,
but we can't show all of them. In order to suggest the right property it
is helpful that any inquiry contains the budget you have in mind, the size
you are looking for and your proposed use, either as a private residence
or as a business. It is a great adventure to acquire a historic castle,
and I am positive that anyone who does will eventually end up with an investment
that is unlike most others. |
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