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Step 3: How Can I Increase the Value of My Home?
Your home needs regular maintenance. This pays off in two ways: Not only is your home nicer to live in, but you will also save yourself from any unpleasant surprises when you come to sell it later on.
Regular Maintenance Offers Protection Against Unpleasant Surprises
You should reserve around one percent of the purchase sum each year for maintenance work. Neglected buildings in need of investment due to a renovation backlog lose value and achieve a lower resale price. Moreover, ongoing maintenance work generally costs less. Plan for the future with the help of life span tables. They will provide you with an indication of the time and type of necessary investments.
Increase in Property Value through Conversion
Whether you add a conservatory or replace carpeting with a parquet floor, by improving the construction standard of your property you are also enhancing its value and are hence better prepared for selling it at a later stage.
- Structural improvements generally boost the sale price (e.g. new central heating, roof insulation, etc.)
- Kitchen and bathroom fittings are best replaced by the new owner (personal taste is a key factor here).
- Obtain a range of comparable quotes as this will give you greater scope for maneuver.
- If you're planning a major construction project, it makes sense to consult a site manager.
- Builders' liability insurance, contractors' all risks insurance and construction period insurance are likewise worthwhile for larger construction projects.
- Receipts for construction investments should be retained for when the property is sold.
- You should also hold on to revaluations of your property (due to a change of bank, for example).
Financing Conversion: Using Pension Capital or through Your Bank
As a rule, you can withdraw pension capital for real estate financing every five years (except for second and holiday homes). If you opt for bank financing, you need to bear in mind the following when increasing the mortgage:
- A renewed credit check will be carried out.
- As in the case of new mortgages, the bank will grant up to 80 percent of the future market value.
- For larger-scale construction projects, the bank will commission a project assessment (review of feasibility and cost estimate).
- Depending on the scope of the construction project, a construction loan will be granted initially or individual larger amounts will be paid out in the form of a mortgage loan.
- As a rule, all Credit Suisse mortgage models (PDF, 140KB) are available (subject to minimum amounts).
- Your Credit Suisse advisor will support you in optimizing your home ownership situation.
Purchase of a New Home
Optimizing your home ownership situation may entail a change of property. Owning a house rather than an apartment can provide much greater scope for maneuver for value-preserving and value-enhancing investments as well as tax optimization.
Moving from your own apartment to your own house results in some important changes: For instance, you now bear financial responsibility for the entire property. In particular, you are solely responsible for accumulating a renovation fund. In order to maintain a better overview, it can be worthwhile opening a separate savings account for this.
As you can see, you can continue building on your dream home for many years even after moving in. In the next step, we'll show you how you can also save taxes at the same time.
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