Exclusive Case Study
From an outdated 3 room apartment to a co living investment property with around 5% rental yield in proximity to the Oktoberfest in Munich
Get the full insights to Nick’s case, a roughly 74 sqm apartment in a prime Munich location near Oktoberfest was modernized within 1 to 2 months, converted into 3 rentable rooms, and optimized to generate €2,475 monthly cold rent plus around €23,000 in first year tax returns.
Only around 5.5% equity required
Roughly €33,000 initial capital for an investment volume of about €600,000.
Rental yield increased from around 2% to around 5%
Abnormal high rental yield Achieved by converting the apartment into a co living setup instead of using it as a standard family rental.
€2,475 monthly cold rent
Generated through 3 separately rented rooms instead of one traditional lease.
Around €23,000 tax return in year one
Nick got back 23.000€ directly from already paid Taxes from the Finanzamt. Created through renovation, depreciation, and tax structuring according to the case.
Prime Munich location near Oktoberfest
Highly attractive rental area with extremely strong tenant demand and nationwide lowest vacancy rate (>0,01%).
Before and after
Before
After
What exactly was changed:
one larger room split into two rooms
kitchen upgraded
electrics and piping improved
furniture added
balcony access used more intelligently
The Initial Problem
The original apartment had potential, but not the right income structure
The apartment, built in the 1970s, showed clear signs of aging and required substantial modernization. Under a standard rental model, it would have generated only around a 2% yield, while parts of the available space remained unused. In addition, the lack of a tax-efficient structure limited the property’s overall performance.
By rethinking both the use of space and the underlying structure, we unlocked the asset’s full potential and turning it into a significantly more profitable and efficient investment.
The LDP Solution
The strategy behind the Nick case
We started by securing a property in a strong location, then redesigned the floor plan to maximize usable space and overall efficiency.
By introducing a co-living rental model combined with a fully furnished concept, we significantly increased the income potential.
At the same time, the renovation was structured in a tax-efficient way to further optimize returns.
From tenant acquisition to ongoing management, we took over the entire rental process, turning the property into a streamlined, high-performing investment.
The Numbers, Black on White
The key numbers from Nick’s case at a glance
approx. €600,000 total investment according to the case
approx. €52,560 renovation portion
approx. 73 to 74 sqm living space
3 individual tenants
€2,475 monthly cold rent
€27,225 annual cold rent
approx. €33,000 equity required
approx. €250 monthly out of pocket
approx. €23,000 first year tax relief
Financing and Cash Flow
Why this case was possible with relatively little equity
The project was realized with just a 5.5% equity contribution, made possible through a financing structure that already incorporated the renovation strategy from the start. By aligning the loan setup with the expected rental performance, the annuity was largely balanced by the generated yield. As a result, the investor was left with only a minimal monthly gap, while benefiting from a significantly optimized asset.
Tax Advantage
The real lever, the first year tax benefit
A big part of the upside came from how the renovation was structured. Instead of just increasing the property’s value, the costs were used in a way that created a strong tax effect in the first year.
On paper, this resulted in a negative income of around €57,000 — which translated into roughly €23,000 in tax savings for the investor.
In simple terms: while the property was being upgraded, it already started paying back through reduced taxes.
Proof and Documentation
Black and white proof, not empty claims
LDP Support After the Purchase
The purchase is not the finish line, it is where the real work starts
The real value is created after the deal is done. We take over the full operational side from ongoing rental management and administration to handling tenant turnover, re-letting, and coordinating maintenance.
Instead of handing over the keys and stepping away, we stay involved as a long-term partner. This ensures the property continues to perform, grow, and deliver results well beyond the initial purchase.
Exit and Long Term Perspective
Not just tax optimization, but real long term wealth building
Based on a conservative model assumption of 2% annual growth, this case illustrates how the property could develop over time. After 10 years, a potential sale price of around €715,000 is projected in this example scenario.
Due to the low repayment rate, a strong leverage effect on the invested equity is created resulting in a potential profit of nearly €200,000, which could be realized tax-free under current regulations.
This example highlights that the strategy goes beyond short-term tax benefits focusing on sustainable, long-term wealth building.
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In a free and non binding consultation, we will assess whether a comparable co living investment structure makes sense for your personal situation.I
