Fix & Flip of a Messy Flat in Germany
We fix & flip a mold-infested flat in Germany into a high-value investment with massive tax benefits. Discover how smart planning turned disaster into big profit! 🛠️💸
Key Takeaways
- We risked thousands on a moldy disaster flat, proving real-world property fix and flips are never picture-perfect.
- A powerful network gave us exclusive access to a hidden gem far from public listings like Immoscout.
- Amidst filth and mold, we saw unique layout potential and jumped on a high-reward opportunity.
- Expert inspection revealed mold’s true causes and reassured us the structure was solid and worth saving.
- We reimagined the layout, upgraded systems, and transformed a one-room flat into a high-value two-room apartment.
- Due diligence paid off as we avoided financial traps, though tax benefits required careful cost management.
- At €3,500/sqm post-renovation, our central Augsburg flat outperformed local market value with lasting quality.
- Prioritize quality, lean on experts, and focus on numbers—not emotions—for smart, sustainable real estate success.
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More InformationFrom Wreck to Riches: Our German Flat fix and Flip Journey
We bought one of the worst properties we had ever seen. Not to brag—it was truly a mess. Mold-covered walls, unlivable conditions, and an odor so intense we needed masks just to step inside.
Still, we saw something others didn’t: opportunity. Our goal was to turn this disaster into a smart, profitable investment. We put tens of thousands of euros on the line without a guarantee of any return. This wasn’t about a polished social media success story. It was a real-world experiment, and we documented every step.
We invite you to join us as we unpack how we found the flat, the risks we faced, and how we transformed it from nightmare to noteworthy. Spoiler alert: it didn’t go as planned—but the outcome might surprise you.
Why We’re in the Real Estate Game
When we started PerFinEx in 2017, our mission was to help expats take control of their financial futures. In 2020, we expanded to offer investment properties, thanks to client demand. But we didn’t stop there. Over the years, we invested heavily in building a network that would allow us to access off-market real estate opportunities.
That network led us straight to this incredibly messy flat—a property we would have never found by browsing Immoscout. It reinforced one of our biggest beliefs: access is everything. Without our partners and the trust we’ve built with them, we would never have been in the right place at the right time. And while this property was a total wreck, we knew it could be something more with the right approach.
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More InformationThe Flat No One Wanted—Except Us
One of our trusted partners reached out about a flat where the previous owner had passed away. The heirs wanted to offload it quickly and with as little hassle as possible. The place was foul. Mold covered nearly every corner. It smelled so bad we had to wear masks just to walk through it. Water stains on the walls, rotting flooring, and years of neglect had turned this place into a horror show. The kind of property most buyers run away from.
But not us. We saw the potential behind the filth. The layout had possibilities. With some creativity and vision, we could transform this into something special. More importantly, we saw an opportunity to fix structural and functional issues that were dragging down its value. It was a big risk. But the greater the risk, the greater the reward—if you know what you’re doing. And we came prepared with a strategy, not just a hope and a prayer.
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More InformationInvestigating Before Investing
Before we committed to anything, we knew we had to investigate thoroughly. So we brought in a certified real estate appraiser. The 45-page report they produced was worth its weight in gold. It identified three mold-causing issues: poorly insulated windows, insufficient heating, and a bathroom with no ventilation or windows. The tenant had also kept indoor temperatures too low, which created cold zones and high humidity—an ideal combination for mold.
Yet here’s the good news—the structure of the building was sound. Without that green light, we would have walked away immediately. A broken building isn’t worth saving. This appraisal shaped our entire renovation strategy. It showed us what needed fixing and confirmed that fixing it would be worth our time and money. Never skip this step. What you don’t know can hurt your wallet—and your future returns.
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More InformationPlanning the Full Redevelopment - Fix and Flip
With our appraisal results in hand, we brought in our general contractor to assess the job. His initial reaction? Shock. He’d seen bad properties before—but this one was in a league of its own. New heating, new windows, new wiring, new bathroom, new floors, new ceiling insulation—we weren’t looking at a renovation anymore. This was a full redevelopment.
But here’s where experience pays off. Instead of restoring what was there, we rethought the entire layout. By extending the bathroom and creating space for a window, we solved one of the major mold problems. Even better, we optimized the floor plan to convert the cramped one-room flat into a usable two-room apartment. That single change dramatically increased the value.
Then came negotiations with the seller. We stayed rational, ready to walk away if the numbers didn’t add up. That’s rule number one: don’t fall in love with a property. Fall in love with the numbers. A beautiful plan is only worth pursuing if the financials support it.
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More InformationRenovation Reality—The Make-or-Break Phase
Demolition is where fantasy meets reality. If you’ve made mistakes in your due diligence, they’ll come out now—and they’ll be expensive. Luckily, we did our homework and surrounded ourselves with experts. Trying to DIY something like this would have ended in disaster. Every unexpected problem—from old electrical wiring to hidden mold pockets—was met with calm and competence by our team.
One thing that could have made the deal even sweeter? Germany’s “Erhaltungsaufwand” tax benefit. It allows you to deduct up to 15% of a property’s price through renovation costs. Unfortunately, our renovation costs far exceeded that threshold. But when we renovate flats for our investors, we carefully stay within that 15% limit. That way, you can take full advantage of the tax benefits, saving tens of thousands of euros. It’s one of the biggest financial wins in German real estate, and it’s something you’ll almost never access if you go it alone. Structuring a renovation right is just as important as executing it well.
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More InformationCrunching the Numbers—Was It Worth It?
We bought the flat for €74,000. Renovations cost another €55,600. That brought the total to about €3,500 per square meter. Considering this is a fully renovated flat in central Augsburg, the price is outstanding. Most flats in the area range from €3,800 to €7,500 per square meter. And that includes units in less desirable locations or with fewer upgrades.
Could we have gotten it cheaper? Sure. But we prioritized quality over cutting corners. We installed durable finishes, modern appliances, and made structural improvements that will stand the test of time. We wanted a property that would hold its value and minimize long-term maintenance costs.
Investing a little more upfront will always pay off in the long run—especially if your goal is to fix and flip or rent the unit out. That’s how you build a portfolio that performs—not just one that looks good on paper.
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More InformationLessons Learned & Tips for Aspiring Investors
This fix and flip taught us valuable lessons. First, quality beats shortcuts every time. Cheap renovations might save money now, but they cost more later. Second, work with experts. Real estate success isn’t about going it alone. It’s about knowing what you don’t know and finding the right people to fill in the gaps. Third, fall in love with the math—not the property. Emotional decisions lead to expensive mistakes. And lastly, don’t be afraid of difficult properties—just be prepared.
If you want to do this right, we can help. Book a free call with us to see exclusive investment properties, professionally renovated and optimized for tax savings. Let’s build your real estate portfolio the smart way.