Dortmund is Germany’s eight largest city in North Rhine-Westphalia with a population of 588,462 as of 2018. Dortmund is considered one of the most favorable second-tier cities for real estate investment due to the presence of several mid-sized IT firms that attracts expats from across Europe. The city has witnessed significant developments in the last few years due to its proximity with the Westphalia region that is actively involved in urban development of infrastructure. In fact, Dortmund had its first technology center named “Technologiepark Dortmund” in the 1980s. With more than 200 firms, TechnologiePark is one of the most successful technology parks in Europe.
The increasing presence of information technology has made the city a truly international metropolis, attracting foreign nationals from across the world. Increasing employment opportunities offered by software firms has resulted in the city being the biggest software locations in Germany. Additionally, in September 2018, Dortmund was recognized as the digital city by Living City Foundation as it rapidly integrates digitization in its city development policy.
The two main factors that influence Dortmunds’s real estate market is the growing population and favorable conditions for construction loans. In 2015, 15.7% of Dortmund's population was classified as non-germans, and this current wave of immigration has resulted in a stable increase in the rental rates in the city. Furthermore, purchase price per sqm for single apartments remained constant from 2001 to 2011, however, prices increased by 27% in 2012, making Dortmund the fastest real estate growth market in Germany. The main factors that drive the demand for housing is the increasing population and growth in economy. Furthermore, average apartment prices increased by 0.53% to €1,515/sqm during the year till Q2 2018. While, the average price of two family apartments increased by 1.95% to €2,042/sqm.
With increasing property prices in major German cities, most individuals prefer second-tier cities a more affordable option. The city has a huge potential to grow due to the presence of new digital and technology centers that connect with several other major hubs globally.
According to IVD, Wohn-Preisspiegel, the flat prices in Dortmund increased to 3.6% with the average price reaching €1,450/sqm in 2016.
Germany's strong economic growth has resulted in price increases across German cities: On average the prices doubled in the last 10 years. Rents also impact the house price development in Germany: the average increase amounts to 50% between 2008 and 2018.
The below figure depicts a 10 year comparison of residential real estate purchase prices for German cities. In Dortmund, real estate prices increased by 22% with purchase price reaching €1,720/sqm over a period 10 years from 2008 (half yearly) to 2018(half-yearly).
LoanLink24 is a German mortgage broker specialized in the Dortmund real estate market. We also help expats and foreign investors get a mortgage. Our highly professional Dortmund mortgage broker team provides excellent advice in English and German. Moreover, we leveraged advanced algorithm technology to find the best mortgage interest rates from over 400 regional and global German banks.
Our smart online mortgage platform is available round the clock to advise you throughout the German mortgage process. For instance, you can use our mortgage calculator to check your loan amount and monthly repayments. What’s more, our service is in English and is completely free of charge.
LoanLink24 is registered and controlled by the surveillance authority in Dortmund.
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When buying a property in Dortmund, you always have to pay for additional fees, such as real estate tax, real estate agents fees, notary costs etc. In Germany, real estate purchase fees may be up to 15% of the property’s purchase price. Similar to a down payment, purchase fees should be covered by the buyer’s own equity instead of a bank mortgage. In Dortmund, the approximate additional purchase fees are as follows:
Real estate tax: 6.50%
Real estate agent fees: 3.57%
Notary costs: 2%
Total costs: 12.07%
For more information in regards to the additional fees you would pay when buying a property in Dortmund, please check out our mortgage calculator for a more accurate calculation.
As soon as your initial mortgage expires, you have two options. On one hand, you can choose to pay off the entire mortgage at once. Otherwise, you can refinance at current market interest rates with your current bank or a new lender. In most cases, refinancing with a new lender results in better rates for you.
We can help you to identify the best refinancing deal from 400+ partner banks.
Altogether, the timeline depends on you. If you have all relevant documents ready the process can take only a few days. In case you want to be covered as fast as possible, please let us know. We have direct relationships to the credit departments of our partner banks and can accelerate the process.
Generally, lenders require information about your personal and financial situation. Some of the documents you will need include:
To list all documents you may need, please find a Complete document checklist on our blog.
Once you decide to purchase property in Germany, contact the LoanLink24 undefined Mortgage brokers via live chat, email or phone. Whenever you have a spare minute, you can also read our German mortgage blog to learn more.