Subsidy of EUR 677,000 + high tax benefits - plot for 8 units in Zerf

Project plot for apartment building with 8 residential units in a beautiful location in Zerf -
- ideal for development with public funding and a high repayment subsidy of up to EUR 677,000 and interesting tax benefits through declining balance depreciation of
5 % annually. A preliminary building application for an apartment building with 8 apartments has been approved. The plans envisage 3 residential units each on the ground and upper floors with 2 rooms, cooking, storage, bathroom, terrace/balcony with areas of approx. 62 and approx. 64 m² respectively.
On the top floor, 2 apartments with 4 rooms, kitchen, bathroom and balcony with approx. 90 m² are planned. Alternatively, development without a basement is also possible. 12 parking spaces are planned.
It is possible to obtain public funding for the apartments from the ISB Rheinland-Pfalz. The amount of the subsidy depends on the location of the property (rent levels 1-7), the occupancy rate and the length of occupancy, the type of apartment, the furnishings and the size of the apartments. Zerf is classified in rent level 5 (i.e. the third highest level). Here, the basic subsidy is between EUR 1,900 and EUR 2,800 per m² of living space, depending on the tenant's occupancy and income level. The ISB grants a repayment subsidy of 40% or 45% on the basic subsidy and 50% on the additional loan. On the basis of the planning, loans of up to EUR 1,506,400 can be taken out for the recognized living space of 538 m². This amount can increase by up to EUR 16,000 per apartment due to location-related additional costs. A repayment subsidy of up to 45% - corresponding to EUR 677,880 - can be claimed here. The loan is reduced by this amount. The interest rate is 1% with a 30-year fixed term. The rent for this subsidy is EUR 7.00/m² with an annual increase of 1.75%. An additional EUR 20 per month can be charged for kitchens and EUR 30 per month for outdoor parking spaces.
With the increased income limit (+ 60 %), the subsidy is EUR 1,900/m² of recognized living space - corresponding to EUR 1,022,200 plus additional loans for location-related additional costs. The ISB grants a repayment subsidy of 30% on the basic subsidy and 50% on the additional loans. On the basis of the planning, loans of up to EUR 1,022,200 can be taken out for the recognized living space of 538 m². This amount can increase by up to EUR 16,000 per apartment due to location-related additional costs. a repayment subsidy of up to 30 % - corresponding to
EUR 306,660 plus a repayment subsidy of 50% for recognized location-related additional costs. The fixed loan term here is 20 years. The interest rate is 1% for the 20-year fixed term. The rent for this subsidy is EUR 8.10/m² with an annual increase of 1.75%. An additional EUR 20 per month can be charged for kitchens and EUR 30 per month for outdoor parking spaces. Details can be found at https://isb.rlp.de/foerderung/551.html.
Irrespective of the funding via ISB Rheinland-Pfalz, KFW funding is possible under program 298 or 296 if the building is constructed appropriately and the relevant evidence is provided. Loans of EUR 100,000 per apartment are possible here. The interest rates here are from 1.07 %.
The newly constructed apartments can now be depreciated using the declining balance method at an annual rate of 5% based on the respective book value/residual value. This can result in high tax benefits. We do not provide tax advice and accept no liability for tax objectives. Your tax advisor will provide you with comprehensive information on this

Zerf, sought-after residential area approx. 20 minutes by car from Trier. Zerf has a very good infrastructure. Elementary school with meals and afternoon care, day care center with afternoon care, supermarket, banks, bakeries, various stores, restaurants, doctors, pharmacy, etc. are available in the village.