Listed real estate – a worthwhile capital investment

A property under monument protection: This means not only a unique living flair, but also financial peculiarities. By investing, you contribute to the preservation of our cultural heritage and acquire a tax-attractive property that retains its value. We will show you what is important in the process:

In Germany, the protection of historical monuments is a matter for the federal states. Each of the 16 federal states has its own monument protection law (DSchG). If buildings meet the necessary criteria for a historical monument, the local monument authority enters the property on a monument list.

Since the preservation of monuments is very important to the state, it participates in your personal wealth creation through tax benefits. Repair and modernization expenses of the listed properties belong to the eligible measures and are therefore tax deductible.

Discuss renovations and modernizations with the monument authority beforehand, because the historic character of a monument property may not be changed just like that. More information
can be found here on the website of the Bavarian State Ministry of Science and the Arts.

Tax advantages of historic preservation properties:

Benefit from special subsidies for listed properties

The monument depreciation (Absetzung für Abnutzung) amounts to 100% of the renovation costs in the first twelve years. You can pay the costs at an annual rate of 9% for the first eight years and in the
9. to 12. year each depreciate at 7%. If you live in the monument yourself, you can deduct 90% over ten years, i.e. 9% per year.
The prerequisite for the Denkmal-AfA is that you start with the renovations only after the purchase of the property. To do this, have the project approved by the relevant authority and submit the certificate to the tax office.

As a landlord, you also benefit from the regular depreciation for wear and tear (AfA). This allows you to write off the acquisition costs of the property (building value) from your taxes in addition to the maintenance costs. Depending on the year of construction of the building, this is either 2% over 50 years (built after 1924) or 2.5% over 40 years (built before 1924).

The state development bank KfW has been offering simplified funding requirements for listed buildings for several years. Owners of historical buildings therefore benefit from low-interest subsidized loans for complete or partial renovations

Contact us if you have any questions about historic preservation real estate: