Buying Property in Germany: How Does It Work?

Step 1. Open a Bank Account and Check the Property

Opening a Bank Account

In Germany payments between the seller and the buyer of real estate are generally made via bank transfer. Other ways of transactions are barely used within the market. It doesn't matter whether you pay from a German or international account, both are equally permitted. No worries: foreigners do not have any obstacles to opening an account in a German bank. But keep in mind that buyers with non-transparent financial past can face some difficulties due to strict legislation policy against money laundering.

To open an account you have to be personally present for proof of identity and other formalities. The current method of "postal legitimation" allows German citizens to verify their identity to the bank in every postal office, but this rule does not apply to foreigners.

Check the demanded documents beforehand. Most often foreign clients are required to give their foreign passport, validated address and correctly field bank forms. Some banks also ask for a letter of recommendation, some demand a post address within Germany (in such case you can use the address of your real estate agent) and conversational level in German or English language. Occasionally, the client is required to provide an income certificate.

The bank is making a service contract after checking your documents and granted information. After finishing all these procedures you become a proud owner of a euro account. And finally can put money there.

Don’t forget to address your bank in order to check what documents and certificates you may need to prove the purpose of payments, if you prefer to pay from an already existing account.

Checking the Property

First thing every potential buyer should do is to see the ‘Grundbuch’ (land registry). You can do it yourself or with help of a private notary. The land registry has all information about current and previous owners, potential encumbrances and mortgages, etc.

Notice that buyers can take the burden of registered encumbrances and mortgages only if they give their consent. During the transfer of ownership debts and overdrafts must be erased from the land registry.

You as a buyer do not risk anything: payment is transferred to the seller’s or creditor’s account only after the bank permits to erase encumbrances (Löschungsbewilligung). The debt repayment can be made at the expense of the purchase price or it’s part. If that is not enough, then part of the repayment must be covered at the expense of the purchase price, and the rest of the debt must be finalized between the buyer and the bank.

Besides the land registry there are several other very important documents you should pay attention to, which are the housing statute (Teilungserklärung), minutes of owners’ meetings (Eigentümerversammlungsprotokolle), the economic plan (Wirtschaftsplan) and finally utility bills (Nebenkostenabrechnung).

The housing statute can tell you about parts of private and common ownership on the land and in the buildings as well as potential rules (elections of a supervisor, animal housing, etc.).

From minutes of owners’ meetings you can learn a lot of useful information about other owners in the household, repairment decisions, currently discussed issues, etc.

The economic plan and utility bills are here to show you sums of obligatory monthly payments. They are called ‘Hausdeld’ and ‘Wohngeld’. You can also check what exactly you have to pay for and whether you can optimize and lower the total amount.

Properties in Germany

1 581 000 €

Commercial property in Germany

1085 sq.m

Germany The land of Lower Saxony, the Hanover district of Springe Penny Supermarket Commercial building for long-term lease Penny Supermarket (Rewe Group) The object is located in the center of Springe (Springe-Bennigsen, Hanover district, population 30 thousand), next to the railway station. Land area: 4850m2 Building area for...

INDOM

7 950 000 €

Commercial property in Germany

1973 sq.m

Germany Federal State of North Rhine-Westphalia Detmold New REWE supermarket with parking A new commercial building (completion of construction and commissioning - summer 2017), fully leased for a long-term lease. Tenants of the building: REWE supermarket (lease agreement for 15 years) and a parking management company...

INDOM

350 000 €

House in Hamburg, Germany

350 sq.m 6 4 2

A residential building in the suburbs of Hamburg is presented to your attention. The object was built in 1900 on a plot of 1,050 sq.m. The house is surrounded by its own garden. The house consists of 2 apartments (101 sq.m. on the ground floor, and 91 sq.m. on the second floor), each of them has a living room, kitchen, 2 bedrooms,...

EW Real Estate

419 000 €

Flat in Berlin, Germany

66 sq.m 2 1 1

Apartments in a new residential complex in Berlin. Number of apartments: 43 Number of rooms: from 1 to 3 The area of apartments: 29 – 200 m2 Equipment: - balcony\terrace; - underground garage; - basement with electrical power connectors; - floor-to-ceiling windows; - underfloor heating; - oak parquet; - built-in kitchen...

Estate-Service24

2 604 000 €

Hotel in Germany

2975 sq.m

Germany federal state of Baden-Württemberg Freudenstadt Wellness-hotel 4**** Hotel 4**** in a tourist area in the Freudenstadt district in the north of the Black Forest. Quiet, calm, green area, conducive to rest. Land area: 6000m2 The area of the hotel is 2,975 m2, two buildings The condition of the hotel...

INDOM

2 900 000 €

Commercial property in Hamburg, Germany

1734 sq.m

Germany Hamburg Car service in Hamburg Premises in the suburbs of Hamburg, leased to a long-term car service workshop. The profitability is 8.9% per annum. Land area: 5105m2 Total area of buildings 1734m2: main building 1184m2 +storage room 550m2 There are 9 "gates" in the main building and a large showcase window. The main...

INDOM

14 300 000 €

Commercial property in Wuppertal, Germany

33900 sq.m 7% per year

Residence Business on sale

Logistics and warehouse center with office premises in the federal state of North Rhine-Westphalia.

Estate-Service24

5 000 000 €

Castle in Germany

2800 sq.m

Germany Rhineland-Palatinate Castle Hotel An authentic castle, restored from the ruins at the end of the 20th century. Land area: 5000m2 Living area of the castle: 2800m2 There is a hotel with a restaurant in the castle. 60 rooms Green, beautiful area: the castle is surrounded by a park, there is a bird park nearby, a...

INDOM

228 000 €

Flat in Berlin, Germany

32 sq.m 1 1 1

Credit

The property is located in an area with apartment buildings and commercial buildings. The surroundings are urban and have excellent accessibility to all services and shops. The property is in close proximity to the recently closed Tegel Airport, whose renovation is giving a positive boost to this part of Reinickendorf. The location is also...

EW Real Estate

100 000 000 €

Hotel in Duesseldorf, Germany

10000 sq.m 3.8% per year

Business on sale

A hotel with a long-term rental agreement in Dusseldorf!Number of rooms: 425 Number of parking spaces: 100 Yield: 3.8 % Factor: 26 Contract: more than 20 years with a well-known hotel chain Location: The capital of North Rhine-Westphalia is very popular both as a place to live and as a tourist center - this is due, among other things, to the...

Estate-Service24

4 150 000 €

Hotel in Frankfurt-am-Main, Germany

1050 sq.m 7% per year

Business on sale

3* high-yield hotel in the Frankfurt am Main airport area. Number of rooms: 45 Yield: 7 % The hotel has been recently renovated and has a 5-year lease with an extension option. There are parking spaces in front of the building. The hotel is just a short drive from Frankfurt am Main Airport. Distances:the airport is 5 km away...

Estate-Service24

137 000 €

Flat in Herne, Germany

113 sq.m

Online Viewing Remote Transaction

There are 3 apartments for sale in Herne. The apartments are located on the 4th floor. The house was built in 1932 and is well maintained The total area of the apartments is 113.63 m2 Hausgeld:486 Euro (per month, total for all apartments) Nearby there are public transport stops, shops, clinics, supermarket REWE, museums, hospitals -...

DEM GROUP GmbH

16 500 000 €

Land in Berlin, Germany

A plot of land with an apartment building construction project in the center of Berlin. A preliminary permit has been obtained for the construction of an apartment building with a total area of approx. 9.500 sq.m. (gross). The object is located in the immediate vicinity of Alexanderplatz. The sale of ready-made residential real estate in this...

EW Real Estate

890 000 €

Commercial apartment building in Wuppertal, Germany

450 sq.m 6.47% per year

Online Viewing Remote Transaction

For sale a solid apartment house with reinforced concrete floors, in the city of WuppertalThe house has 8 apartments and 8 garages, as well as one commercial spaceThe object is fully leased!Annual income: 57.600 euros (6.47%)Commission for the buyer +4.76% of the cost of the object.Details on request.

DEM GROUP GmbH

750 000 €

Flat in Berlin, Germany

85 sq.m 3 2 1

The new building in the center of west Berlin in the Wilmersdorf district was commissioned in 2020 and impresses with its beautiful architecture. The apartment on the mezzanine faces south and has a spacious loggia of almost 15 square meters, which in summer becomes a second living room. An underground parking space with charging for an...

EW Real Estate

220 000 €

Flat in Wuppertal, Germany

110 sq.m 5 2

Online Viewing Remote Transaction

A room for sale on the 1st floor, in the city of Wuppertal. A very beautiful place in the city center with a wonderful view of the city. You can purchase this wonderful property for a bright apartment, office, practice and even a good hostel. The house was built in 1985 Central gas heating 5 rooms The room is rented out and generates...

DEM GROUP GmbH

4 100 000 €

Flat in Berlin, Germany

196 sq.m 5 4 4

This is a very special top-class facility full of luxury, which is located in a park area on the private shore of Lake Diana in Berlin - Grunewald. The apartment occupies the entire ground floor of the villa and is surrounded by its own garden. All this creates the impression of your own home. Already at the entrance, you are amazed by the...

EW Real Estate

5 200 000 €

Commercial property in Berlin, Germany

1097 sq.m

Anchor tenant - Netto supermarket chain, lease agreement until 2040, without the right to terminate until 10.2025. The Netto supermarket chain was created in 1983. The first supermarket was opened in Bavaria. In the 90s, the network began to actively develop, and in 2005 the Edeka brand was added to the network. Netto is considered the largest...

Mercury Group

1 750 000 €

House in Munich, Germany

164 sq.m 7 5 3

Online Viewing Remote Transaction Credit

An exquisite townhouse in Munich with a sauna and a beautiful garden. Welcome to your new cozy home, which is located in the city with all its amenities and infrastructure and at the same time allows you to enjoy the benefits of living in a private house and nature! This exclusive property offers not only spacious living space, but also many...

Campus Property

171 300 €

Commercial property in Dresden, Germany

34 sq.m 5.48% per year

Apartments in the five-storey castle residence in the village of Uhyst (an hour's drive from Dresden). The residence was built in the 18th century, and is currently being restored. On a plot of more than 3,500 sq.m. there are gardens in English and Baroque styles, the river Spree flows through the land. Guaranteed rental income from the...

Intermark Global

See more 425 similar properties

Step 2. Conclude a Contract

To sign a contract the buyer and the seller should meet at a notary office. Both parties don't have to be present at the office at the same time. The seller and the buyer or their representatives can seal the deal at different notaries in different places. The contract enters into force after both the seller and the buyer sign it. The only mandatory condition is to certify the agreement at the notary’s.

Take into account that a notary has to read the contract out loud and reply to any questions and concerns. After the reading and questioning both the seller and the notary sign documents and get verified copies.

You are not required by law to pay a deposit, but most brokers take an advance on their commission. Usually it is of either 1% of the cost for those German buyers who do not seek for translation and deal support or in the amount of the entire commission for foreigners.

Step 3. Make a Payment

There are two possible options for payments between the seller and the buyer:

• a direct payment to the seller's account;
• settlement via a notary's trust account (Notaranderkonto).

The first option in the most popular one. In this case, the payment is provided to the seller’s account after receiving a letter from the notary stating that every necessary prerequisite has been met (Preisfälligkeitsbescheinigung).

The possible prerequisites are pre-registration of property rights in favor of the buyer (Auflassungvormerkung), obtaining a certificate from the bank for permission to erase encumbrances (Löschungsbewilligung), if any of them are still present, obtaining permission from a household supervisor for sale and purchase (Verwalterzustimmung).

Payments via a notary's trust account are only used when both parties wish to transfer ownership as quickly as possible. A trust account is opened by a notary specifically for this transaction after signing the contract of sale, where the buyer pays the purchase price within a particular period of time (usually 2-4 weeks). The buyer gets keys and the right to move into the property after proceeding the payment. 

Only the notary has access to a trust account and pays the purchase price to the seller's account after completing all necessary prerequisites for a payment.

Foreigners do not have any obstacles to opening an account in a German bank.

Step 4. Registrate as the New Owner

The notary sends an application to the land court (Grundbuchamt) for pre-registration of the buyer as the new owner immediately after signing the contract of sale. After this the payment is transferred to the seller's account by the buyer directly or via a notary’s trust account.

When the seller receives money and pays real estate taxes, the notary sends an application to the land court for final registration and deleting of the preliminary one. All data is stored in the electronic cadastre (the land register), from which the owner can request an extract at any time.

Usually the contract specifies the date of "economic transfer of ownership" from which the buyer takes over all rights and obligations related to the ownership of real estate: accommodation, renting, utilities, etc. The economic transfer of ownership rights is often appointed on the 1st day of the month following the final transaction or the next day after. It is done for the sake of convenience of calculations.

The whole procedure from signing the contract and registry of a new owner to the final registration of property rights in the land registry takes from 2 to 4 months on average. It can take even longer, if property is sold by a bank, an insolvency administrator, a guardianship court, with the involvement of a mortgage loan, etc.

Quoting conditions of Prian.info materials