MYHOME REAL ESTATE - THE ORIGINAL SINCE 2014
Many homeowners in Feucht own significant real estate assets, but their monthly pension barely covers their living expenses. Partial sale and reverse mortgages are two options that provide liquidity without requiring a move-but they differ significantly in terms of costs, risks, and what ultimately remains for heirs. This article provides a sober comparative analysis.
Feucht is located south of Nuremberg on the edge of the Reichswald-one of the most sought-after residential communities in the affluent suburbs of the metropolitan region. The S2 S-Bahn line connects Feucht to Nuremberg Central Station in about 20 minutes. Many homeowners who built in the 1970s and 1980s have lived in their homes for over 40 years. The Feucht market area includes not only the main town but also Moosbach and borders Altenfurt (part of the Nuremberg metropolitan area) to the north.
The result: In Feucht, the average age of homeowners is high, properties are often unencumbered or have only minimal liens, and market values have multiplied over the past twenty years. A detached single-family home built in 1980 for 180,000 DM is now worth 400,000 to 550,000 euros. The capital is tied up in the property-but the pension is fixed.
Partial sale and reverse mortgages were developed precisely for this situation. The question is which model is a better fit.
In a partial sale, the owner sells a share of their property-usually 20 to 50%-to a specialized provider. The purchase price corresponds to the market value of the acquired share, determined by an appraisal conducted by the provider. The owner receives the amount immediately and pays a monthly usage fee in return.
The usage fee is calculated based on the amount paid out and ranges from 3.0 to 4.5% per annum, depending on the provider. In addition, there are administrative fees and, in the event of a subsequent full sale, an execution fee for the provider (often 2.5-5% of the sale proceeds).
The owner retains a lifetime right of residence, which is notarized and entered in the land registry. If the owner dies or moves out, the property is sold-the provider receives their share of the proceeds, and the heirs receive the remainder.
Critical point: The usage fee is based on the amount paid out at the time of sale, not on the current property value. If the value of the property increases, the provider’s share of the eventual total proceeds also increases-but the usage fee does not. In the event of appreciation, the provider benefits disproportionately.
The reverse mortgage functions as a loan secured by a first-lien mortgage on the property. The owner pays no monthly installments-instead, interest accrues, and the entire amount becomes due only upon sale, moving out, or death.
In Germany, the market for reverse mortgages is significantly smaller than in the U.S. or the U.K. The model is offered by only a few specialized institutions. Deutsche Leibrenten AG and certain savings bank subsidiaries are the best-known providers.
The model has a serious drawback: due to the compound interest effect, the loan debt can grow significantly over a long term. At an interest rate of 5% per annum, the debt doubles approximately every 14 years. Anyone who takes out a reverse mortgage at age 75 and lives to be 90 will leave behind a significantly reduced estate.
In its consumer protection guidelines, BaFin explicitly points out that reverse mortgages are complex, carry significant long-term risks, and must be reviewed by an independent advisory service (e.g., the Bavarian Consumer Advice Center) before being finalized.
The following table shows a model example calculation for a typical situation in Feucht: a 75-year-old homeowner, property value €480,000, unencumbered property, living alone, net pension income of €1,400.
| Parameter | 50% partial sale | Reverse mortgage | Traditional sale + rental apartment |
|---|---|---|---|
| Immediate liquidity | €240,000 | €120,000-€160,000 (lump sum) | €450,000 (after costs) |
| Additional monthly expense | €700-900 usage fee | €0 (no payments) | €900-1,200 rent |
| Continued residence in the property | Lifetime right of residence (guaranteed) | Lifetime right of residence (guaranteed) | No (rental apartment) |
| Estate value (estimated after 15 years)* | €115,000-160,000 | €90,000-140,000 | €270,000-330,000 (depending on investment) |
| Regulatory risk | Provider creditworthiness, terms and conditions | Compound interest risk, few providers | None |
| Tax on cash inflow | Generally tax-free (Section 23 EStG) | Generally tax-free | Generally tax-free |
Estimate based on 1.5% annual appreciation, usage fee provider 3.5% p.a. (partial sale), loan interest 5% p.a. (reverse mortgage), rent increase 2% p.a. (traditional). Individual consultation is absolutely necessary.
Source: Model calculation by my-home.de editorial team based on provider terms and conditions for 2026, BaFin consumer protection guidelines for reverse mortgages (as of Q4 2025), Feucht/Nuremberg-South rent index for 2025.
> The valuation tool from leadmarkt.ch provides an initial estimate of the current market value of your property in Feucht-data-driven and available in just a few minutes.
In recent years, BaFin has repeatedly highlighted risks in the partial sale market. The most common issues include:
Appraisal Risk: The provider commissions the appraisal itself. Owners should obtain an independent counter-appraisal before accepting the sale price.
Usage fee adjustment: Some providers stipulate adjustments to the usage fee after an initial phase, which are hidden in the fine print of the terms and conditions. A legal review of the contract is strongly recommended.
Execution fee upon final sale: Upon the total sale, the provider often receives a fee of 2.5 to 5% of the total proceeds-not just on their share. This can significantly reduce the owner’s effective return.
Provider’s right of first refusal: Many partial sale contracts grant the provider a right of first refusal. This can make it difficult for heirs to sell the property to third parties at an optimal price.
With a reverse mortgage, the main risk is the compound interest effect over long terms. Those who live to a very old age and took out the loan early may end up facing a remaining debt that has consumed a significant portion of the property’s value.
A frequently underestimated aspect of partial sales and reverse mortgages is the tax dimension. Anyone who has owned the property for more than ten years or has lived in it themselves during the last two calendar years benefits from tax exemption under Section 23 of the German Income Tax Act (EStG): The proceeds from the partial sale are then exempt from income tax.
This applies to the portion sold as well as to a complete sale. In the case of a 50% partial sale (proceeds of 240,000 euros with a property value of 480,000 euros), no income tax is due in this instance. This tax exemption applies to most homeowners in Feucht who have lived in their homes since the 1970s or 1980s.
Things get more complicated with the monthly usage fee that the owner pays after the partial sale. This is not tax-deductible as business expenses-neither for owner-occupancy nor for rental. It is a usage fee for the sold portion, which must be paid out of net income. With a usage fee of 3.5% on 240,000 euros, that amounts to 700 euros per month-paid from after-tax income.
The situation is similar with a reverse mortgage: The loan amount paid out is tax-free because it is a loan, not income. The accrued interest later reduces the taxable estate. This can be relevant for the heirs if the sale of the property is taxable upon inheritance.
One issue that is often glossed over in sales pitches for partial sales and reverse mortgages is the estate. Both models reduce the value available to the next generation-sometimes significantly.
With a partial sale, heirs no longer own the entire property. They inherit only the remaining ownership share (50% in the example). In addition: The provider often has a right of first refusal on the total sale and charges an execution fee. The inheritance potential can thus shrink to significantly less than half of the original property value when you add up appreciation, fees, and the term of the usage fee.
With a reverse mortgage, the compound interest effect is the key variable. With a loan interest rate of 5% per annum and a term of 15 years, the loan debt roughly doubles. An original loan of 150,000 euros thus becomes 300,000 euros in debt, which becomes due upon death. If the property is then still worth 500,000 euros-minus selling costs, approximately 470,000 euros net-170,000 euros remain in the estate. With a longer term, the situation becomes tighter.
This does not mean that these models are wrong. It means that the decision affects not only the owner herself, but the entire family. Open discussions-ideally with an independent financial advisor-are essential.
In Feucht, one factor plays a special role that is often underestimated: the location near the Reichswald. Properties with a direct view of the forest or located on the forest edge are valued by appraisers with a location premium of 5 to 12%. This premium has a positive impact on partial sale appraisals or when determining the mortgage lending value for a reverse mortgage-but it also means that an independent second opinion is all the more worthwhile if the seller does not fully reflect the quality of the location.
The S2 connection to Nuremberg also boosts market liquidity: Feucht is attractive to younger buyers as well, meaning that a traditional sale can likely be completed within a few weeks-an argument that makes the third option in the table (traditional sale) seem realistic.
Neither a partial sale nor a reverse mortgage is inherently bad-but both have specific pitfalls that are easily overlooked without independent advice. A traditional sale followed by moving into a rental apartment remains the most financially transparent option, but it requires parting with your own home.
If you absolutely want to stay in your own home and need liquidity, you should:
The starting point for all considerations is the current valuation of your property: The valuation tool from leadmarkt.ch provides a data-driven estimate for Feucht and the entire Nuremberg metropolitan region-and thus serves as the foundation for any reliable comparative analysis.
Prepared by the my-home.de editorial team in collaboration with regional real estate analysts. Data as of May 2026.
In a partial sale, the owner sells a share of their property-usually up to 50%-to a specialized provider and receives immediate cash in return. In exchange, they pay a monthly usage fee (3.0-4.5% per annum of the amount paid out) and retain a lifetime right of residence. This model requires that the property be unencumbered or have only minimal encumbrances.
With a reverse mortgage, the homeowner takes out a loan secured by a lien on the property. The homeowner receives the funds as a monthly annuity or a lump sum, continues to live in the home, and makes no payments. The loan, including interest, becomes due only upon the homeowner’s death, when they move out, or when the property is sold. In Germany, only a few specialized institutions offer this type of loan.
Well-known providers include Heimkapital, Deutsche Leibrenten AG (DSL), Engel & Völkers LiquidHome, and Wertfaktor. BaFin notes that terms and fees vary significantly and strongly recommends conducting an independent comparison before signing a contract. Some providers adjusted their terms in 2025/2026.
Proceeds from the partial sale are generally tax-free if the property has been owned for at least ten years or if the owner has lived in it personally during the two years prior to the sale (speculation period under § 23 of the Income Tax Act). The monthly usage fee is not tax-deductible as an income-related expense. A tax advisor should review your individual situation.
In a partial sale, the heirs inherit only the remaining ownership share, plus any potential appreciation in value. The seller retains their share and usually has a right of first refusal. With a reverse mortgage, the family inherits the property minus the accrued loan balance, including compound interest-which can significantly reduce the estate’s value depending on the term of the loan.
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Content researched and verified by the my-home.de expert network - specialized in real estate sales, valuation, and market analysis in Nuremberg, Fürth, Erlangen, Schwabach, and Roth.
Note on content
This guide article serves as general information about the real estate market in Nuremberg and the surrounding region. It does not replace individual tax advice, legal advice, or expert valuation in specific cases. For binding information, please contact a tax advisor, attorney, or certified appraiser.
Market data, prices, and statutory provisions may change at short notice. Despite careful research, we assume no liability for the accuracy, completeness, or timeliness of the content.
Article as of May 26, 2026
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