Glossary
The language of valuation, without the jargon.
So that you understand every report in full, we explain the most important terms here, short and clear. If a word is missing, ask the assistant at the bottom right.
Value and price (9)
- Market value
- The price that can realistically be achieved in a sale under normal conditions. Not to be confused with the asking price, which is only a starting point for negotiation.
- Conservative value
- When buying, the market value less a fixed safety margin of ten per cent. DomoScan24 shows this figure as the recommended upper limit for your negotiation, so that you never bid too much. For a rent there is no deduction, there the figure that counts is the local comparable rent itself.
- Safety margin
- A fixed deduction from the market value when buying, which absorbs uncertainty and risk. At DomoScan24 ten per cent, built in, nobody can click it away. It does not apply to renting or letting, because a deduction on a monthly rent would make no sense.
- Negotiation discount
- The difference between the asking price and the purchase price actually achieved. It exists because hardly any property is sold at the first price demanded.
- Lending value
- The durably safe value of a property as a bank sees it, usually below the market value. It decides how much credit the bank gives.
- Income value
- The value of a property from the point of view of letting. It follows from the sustainable annual net income divided by the capitalisation rate.
- Capitalisation rate (Liegenschaftszins)
- The rate at which future rental income is discounted to today's value. The higher the rate, the lower the income value.
- Standard land value (Bodenrichtwert)
- The officially determined average value of the land per square metre in a location. The basis for valuing the share of the plot.
- Incidental purchase costs
- Additional costs when buying, for example transfer tax, registration, notary and, where applicable, an agent. They raise the real total investment considerably.
Letting and yield (6)
- Gross yield
- The annual net cold rent in relation to the purchase price, in per cent. A quick figure for earning power, without costs and without vacancy.
- Cash-on-cash return
- The running surplus after tax of one year divided by the equity put in. It shows the pure cash return on your capital, without appreciation and without repayment, and it can be negative if the property costs money at first.
- Return on equity
- The whole return on the equity put in during one year. Besides the running surplus it also counts the repayment (which builds up assets) and the appreciation, so it is usually higher than the pure cash-on-cash return.
- Total return
- The return over the whole holding period, converted to one year. It brings together the accumulated surpluses, the debt repaid and the appreciation and divides everything by the equity. The calculator works it out with a real repayment schedule.
- Break-even rent
- The net cold rent from which the property carries itself, that is, just covers running costs and the full loan instalment. Above it the property throws off a surplus every month, below it you have to put money in.
- Repayment period
- The number of years until the loan is fully repaid at the current instalment. If the instalment only covers the interest, nothing is ever repaid, and DomoScan24 says so openly.
Checking and proof (6)
- Red Flag
- A concrete warning sign on the property, for example a repair backlog, damp, noise or a price above the market. DomoScan24 names every red flag with its severity.
- Four-eyes principle
- Every report is checked twice: a fixed arithmetic checker recalculates every central figure without AI, and a second, independent AI model takes the result apart again.
- Verification number
- The unique number of every report. With it you can confirm online that a report is genuine, when it was produced and whether it has been second-checked.
- Source register
- The numbered list of every source consulted for a report. Each source carries its own number, so that the valuation can be checked afterwards.
- Integrity checksum
- A digital fingerprint of the report. It proves that the report is unchanged since the checksum was set, and it also appears in the PDF. If a report is corrected later, the checksum is set again and the date is stated with it.
- Confidence (how much it carries)
- How solid a report is, given the data available. If important details are missing, the confidence falls, and DomoScan24 writes openly which data is missing.
Location, condition and environment (6)
- Energy performance certificate
- A document that states the energy figures of a building, for example the heating demand. A weak certificate announces high running costs.
- Zoning (Flächenwidmung)
- The officially fixed use of a plot, for example residential area, building land, green land or industry. It decides what you may build and how you may use the property. DomoScan24 shows it directly on the location map wherever the authorities publish it.
- Natural hazards
- Hazards from nature mapped by the authorities, for example flood, landslide, avalanche, rockfall, ground movement or earthquake. If a property lies in such a zone, building conditions often apply and insurance costs can be higher.
- Radon
- A natural radioactive gas from the ground that can enter buildings depending on the geology and counts as a health risk. In areas with high radon potential a measurement is advisable. DomoScan24 shows the official radon potential where it is available.
- Contaminated sites (Altlasten)
- Plots with recorded or suspected contamination of the soil, often from earlier industrial use. They can mean an obligation to clean up and a considerable loss of value. DomoScan24 points to the official register of contaminated sites where it exists.
- Major accident risk
- The risk from a serious accident at a nearby dangerous plant such as a chemical works, a refinery or a pipeline. Around such plants there are consultation zones with building conditions. DomoScan24 shows these technological risk zones where the authorities provide them.
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