European Stars And Stripes (Newspaper) - May 27, 1986, Darmstadt, Hesse                                Magazine tha John Schwartz pet fab Hilltop Home before the final Lane leaping. A Home away from Home does it pay to buy overseas by Marynett consumer editor t he three Homes in Germany could t Bemore different a prefab Hilltop Home near Wurzburg a former farmhouse in Griesheim on the outskirts of Darmstadt and inelegant town House in Heidelberg. The homeowners however All have one thing a common. They Are among the americans ill Leary and civilian who. In recent years have plunged into foreign real estate. Why such Loreign Home investment does it really pay Are there risks according to Jerry Shiles Legal assistance Alloney for the . Army s stall judge advocate of lice in kaisers Lauvern Germany the Home buying Binge did t really gel going until about three years ago. The Bard Dollar started it he says noting that As americans showed More and More interest German contractors and Bankers began to be aware of a new Market end to respond to ii. Soon bilingual real estate of laces were beginning to pop up and american universities overseas were giving courses in German Home financing. At first says Shiles a lot of Fly by night firms jumped in with Hopes of making a Quick Buck. Now he says the Market has stabilized and most of the bad Guys have been screened out. Besides the previous Strong Dollar Low interest rates averaging from 7 to 8 percent and a depressed housing Market also have been big drawing cards says shiels a Homeowner himself. There Are a lot of germans who Are trying to sell because they can t make their payments Shiles does nol recommend american investment in German real Estale for those in the military who Are going to be Here Lor no More than the Normal married couples three year tour of duty. Buying with the idea of reselling in the Mailer of a. Few years can involve a lot of Effort and just by the nature of the beast you can stand to lose. I d put an overseas stay of five years As the Bottom line he says. You can five in it for the first four years and then Start advertising it for Sale it is not always easy to turn Over property  Gebhard Volk. German attorney adviser at i he Usa eur Legal assistance office in Heidelberg says that the housing Market has become saturated while population growth has reached a virtual standstill. Of course there May be certain areas where there is still a demand a notes but generally the Market is depressed and there is no guarantee thai the situation is going to change in the near  Shiles has seen e number of eases where americans. Have had very bad Luck when they have tried to put a House on the Market. For example he knows of a Young major who has been trying to sell a House Lor two years and a civilian who has had his House on the Market since last october. The civilian has dropped his i ice by 50,000 Marks about $22,200 at $2.25 Marks to the Dollar he still has not had a taker when a leaves hell have to try to find someone Hare to ran it Lor him and most German real Estale agents Don t like to Gat involved with Absentee  generally rent does t cover House payments. One american Homeowner who has payments of 2.500 Marks a month estimates he will nol be Able to rent his House for More than about 1,500 Marks. He will be losing 1.000 Marks a month not including Cash outlays Lor  buying says Shyles May make sense in you made a significantly Large profit on the Sale of property in the United states. Then a Home overseas can shelter that gain. It is not going to be a get Rich scheme however he says. Shiles whose wife is German and who plans to stay in Germany indefinitely bought his Home seven years ego when the Exchange Rale was 1.71 Marks Lora Donar.  he says that though the Home has come Down in Dollar value the Mark value has increased and he has been Able to write off i he interest payments which he paid at the outset. It was a worthwhile investment and we enjoy the Freedom that having our own House involves. We do pay significantly More than when we were renting. The payments run More lha n 2,500 Marks a month about �1,111. The House i had rented was much larger and Cost Only 1,200 Marks As to financing most americans making a first time buy Are financing about 80 percent the Loans Range anywhere from 20 to 30 years. Unlike in the United states where there is a fixed interest Rale the Banks Here will Oiler a variable Rale fixed for one two. Five or . At the end of the agreed period of time the rate is recalculated. Ii you Are willing to fix the Rale for just one year you can get a very Low  this can be risky however. Shiles recommends that. Members of the ill Leary stick to a fixed rate. You then know your payments in Marks won t go up in five  there Are several ways of financing in Germany he notes. You can Lake out a building savings contract a life insurance policy plan or a traditional Bank loan Shiles believes hat americans would do Best clicking to the Bank loan. The other financing plans Are beneficial to some germans but Oiler no advantages to a . Citizen. He says that the american Market is about equally split among those buying Homes from two to Tulve years old. Building new Homes and purchasing pre labs. There Are complications out there. Before buying talk to a Legal assistance officer find a knowledgeable person in the Community fake a University course talk to others who have bought says Shiles. Americans can run into problems when they Don t get proper financial advice Belore buying and sign contracts they do nol understand. One couple who did not have their contract translated found it did not provide for things they assumed would be included As is Normal in america.". When the House was turned Over to them by the contractor there were no front Steps no Kitchen sink no basement windows or landscaping. Ii was basically  one of shale s clients discovered thai none of the Bills for subcontracted work were included in the final Price. ,. He wound up having to pay about an extra 100,000  another Man bought a two family Home with a basement apartment. That s what he and his family moved into and what the blueprints also had shown. When he attempted to make the official Transfer. However he was told Hal he had a one family House. It seems that the previous owner had used. Unauthorized workmen and never had any of Trie work inspected to meet required building codes. It Cost him an Arm and a leg to get everything into compliance with German Law says Shiles noting that s & s photos by Dave Didlo Belore buying you should always Check with the appropriate agencies to see if the House has been put on Ilia properly. Shile also Point out thai american civilians should think about the fact that they will lose their housing allowance in 10 years. Some of our teachers have been Here for 25 years or so. If they rent the allowance goes on forever. If they buy they can keep in for Only 10 years. Then they Are Back on heir  he says he also has heard thai the irs is toying with the idea of making a portion of the housing allowance non deductible. The ruling has been deferred until Jan. 1, 1987. Tuesday. May 27, 1986 the stars and stripes Page 13