From finding a house in Germany to signing the contract, we take you through the process of buying a home in Germany.
While most countries swing strongly in favour of either renting or buying your home, the options are balanced in Germany, with just around half the population owning their own homes, one of the lowest rates in Europe.
Expect to spend a significant period house hunting, but once you’ve found a property it can take just over a month to complete the deal. The steps are typically as follows:
- Investigate mortgages and get an offer in principle.
- Find a suitable property.
- Make an offer.
- The notary (notar) will draw up the sale contract.
- Finalise the mortgage.
- Sign the contract.
- Notary registers the sale.
- Four weeks later, you must pay the property sale tax.
It’s important to note that signing the contract isn’t enough to transfer the property. The property must also be registered, which the notary will do. At this point, the government will check that there are no outstanding issues regarding the sale. The notary will already have made a check, so this rarely raises an issue, but if it does, the property transfer will not be complete until the knots are untangled. For this reason, many people choose to use the notary as an escrow. In this case, the sale price is transferred to the notary’s account (notaranderkonto) before being released to the seller.
Fees and charges
When buying a property in Germany, you can expect to pay most of the costs. Typically, the seller will pay the estate agent, however if you have used a buyer’s agent or the agent splits their fee, the buyer may still have to pay this cost.
The total cost to the buyer of purchasing a property is usually around 10 percent of the purchase price. This covers:
- Property transfer tax (grunderwerbssteue) of 3.5–6.5 percent;
- Notary’s fees 1.2–1.5 percent;
- Registration fees 0.8–1.2 percent;
- Estate agent’s fees, if shared, of 1.5–3 percent, plus VAT at 19 percent.