How to buy a property in Germany

How to buy a property in Germany

Property buying Process in Germany

Buying a property In Germany

Rent or Buy?

The last 10 years have seen house prices and rents rocket in Germany. Rents have gone up by 15% and if you’re looking to buy, a house will set you back 23% more than it did 10 years ago.

Home-ownership throughout Europe runs at nearly 70%. A 2014 survey found that in Germany this figure is just 52%, giving Germany one of the lowest home-ownership rates in the EU. However, this has started to shift significantly over recent years. Historically low-interest rates have caused more people to opt to buy a house, rather than rent.

The 2008 credit crunch, that hit many Western countries, especially in the USA and Europe, left Germany relatively unscathed. This has given the German property market a reputation of being a stable investment for foreign buyers for many years.

In more recent years, demand for German property from international buyers and investors has pushed up house prices. 2015 saw an increase of 5.8%, 2016 saw a further increase of 8% 2017 prices rose by a further 6.1%. 2018 should be no different.

In Germany half, the population have bought their properties and the other half rent. which is best? As property prices have risen, so have rental incomes. The last 5 years have seen rents increase by 15%. Like in many western countries, the worry is that wages are not keeping pace with rents and something will need to done about that. Berlin was the first city in Germany to have rent caps put on Landlords. This was in response to high increases in rents between 2012 and 2015. Between 2013 and 2014 rents were increased by 9% on average!


House price rises are affected by local market forces, such as the availability of housing stock, and changes in the demographics. This means that the steep increases haven’t been across the board in Germany. In the first half of 2016, for example, prices actually fell in Dortmund by 3%, and the cities of Dresden and Hamburg saw only modest increases of under 2%. On the other hand, the southern German cities of Munich and Stuttgart experienced price increases of around 10% year on year.

Berlin, Germany
The Brandenberg Gate, Berlin

Can foreigners buy property in Germany?

There are no special requirements nor paperwork for foreigners wishing to buy property in Germany. Uk nationals shouldn’t have any issues.


How can I find a property in Germany?

Property agencies and agents

There are several avenues you can take to find a property in Germany:

  • Through an Estate Agent (*immobilienhändler or makler)*
  • Through an online portal which puts owners directly in touch with prospective tenants
  • Through word of mouth.

Estate Agents

An estate agent, (AKA immobilienhändler or makler, in German) if used, generally work on behalf of the seller. However, as the prospective buyer, you can also choose to use a buying agent to help you. The estate agent fees are likely to be between 1.5 and 3% of the price of the property. These are usually paid by the seller, or split between the buyer and the seller.

If it’s the first time you’ve bought a property in Germany, then a specialist agent might offer helpful advice and insight into the local market. However, there will be a fee to pay for this service, and you should make sure you’re clear on what you’ll get for your money, as both the packages and prices vary wildly.


Avoiding scams and pitfalls

Ask for local advice and recommendations for a broker, to avoid scams and pitfalls. Looking for membership of a professional body is another good choice. The IVD is an association of German realtors, which has over 6,000 direct members. Choosing an agent who holds this membership should make sure you don’t fall foul of any scammers.

German property portals

The best way to get a head start on finding a place to buy in Germany is to look online. Great websites to find a house or apartment to buy include:

  • Rightmove Overseas – A UK based site allowing you to search for flats and houses. The English language site makes it easy to navigate, but be wary of overpriced properties aimed at attracting expats who haven’t done their homework.
  • Immobilien Scout – Offers a wide range of housing options.
  • Wohnungsboerse – Puts you into direct contact with landlords, so there aren’t any agent fees. However, this will mean that you have to do your own research to make sure the place is suitable.

How do I choose the right property?

Property types

Germany has a well developed real estate sector. This means you’ll have a wide choice of apartments, houses or even land if you want to build your dream home yourself. Naturally, you’ll find more flats available in built up areas and cities, with houses and villas more readily available in newer developments in the suburbs, and in towns and villages. The recent rise in house prices has fuelled much new building, and you’ll find a good mix of older properties and new build condos in the cities.

Condition of the property

It’s a smart idea, though not required by law, to get a survey done on any property you choose before you commit to buying it. Older houses, in particular, can have hidden problems which are costly to fix. Find a registered surveyor online, or ask for recommendations from local connections to double check the property.

Other things to look out for

It’s worth knowing that buying a place that’s currently occupied can be problematic as it can be very difficult to force the sitting tenants to move on without a full eviction process. Be wary if this is the case for your chosen property.

What are the steps to buying a property as a foreigner?

Buying a property in Germany isn’t too dissimilar to buying a home elsewhere in Europe or North America. You’ll need to:

  • Decide which mortgages might suit you, and get an offer in principle so you have a budget in mind
  • Find the property you want to buy
  • Make an offer the seller agrees to
  • Get a notary (*notar*) to draw up the sale contract
  • Go back to the bank and finalise the mortgage
  • Sign the contract, and have the notary register the sale
  • Within a month, you then have to pay the property sale tax (3.5–6.5% of the purchase price)

What are the legal requirements for buying a property in Germany?

The notary has an extremely important role in house sales in Germany. He’ll check the land register to make sure the property can be legally sold and check for any restrictions on its use. There will then be a signing meeting in which the notary is obliged to read out the contract in front of all concerned parties and check understanding before anyone signs. Naturally, this is all carried out in German, so it’s probably worth paying for an official translator to be present if you need help.

You can choose whichever notary you’d like to manage your property purchase, so find someone you trust and who speaks English if your German isn’t up to scratch.

How do I get a bank loan/mortgage?

In most cases, to buy a home in Germany you’ll have to take a mortgage through a German bank. There’s no legal barrier to getting a mortgage with a bank from another country (within Europe, at least), but individual banks usually decline such applications. This is because there are checks the lender must do on both the property and the borrower, which typically have to be arranged locally. Thus making cross-border mortgage lending fairly unusual.

However, Germany has a developed banking sector and you have a good choice of local and global banking brands to choose from when it comes to arranging a mortgage (hypothek). The four largest banks in Germany are Deutsche Bank, Commerzbank, Postbank and Hypovereinsbank. All offer mortgage products, although it’s worth checking the small print as each product will differ slightly from the next.

You don’t legally need to be a resident to open a German bank account and arrange a mortgage. However, if you’re not an official resident you might find that you’re only offered a relatively low mortgage amount (in the region of 60% of the property price). This will mean that you may need to pay up to 40% of the purchase price upfront as a deposit, which is a hefty amount.

How do deposits, down payments, mortgages and bank loans work?

Each bank will operate slightly differently, so call your local branch to check if you need to make an appointment in advance. You should also check if there’s an English speaking staff member who can help you, as this isn’t always the case.

It’s worth getting a mortgage agreement in principle before you go on too far with your property search, as this will give you a more solid idea of what you can afford.

Once you’ve found the right home for you, you’ll have to hand over details of the property such as a property assessment and proof of current ownership from the Land Register. You’ll also have to prove your ability to service the mortgage, by showing your payslips or evidence of your net worth.

Deposits / Down payments

The amount of deposit you’re asked for will vary depending on the mortgage deal you choose. It’s normal to pay at least 20% up front, but some expats are asked to pay more (up to 40%) because they’re considered to be riskier than local buyers. What matters most is whether or not you’re an official resident of Germany, as banks tend to offer larger mortgages to those who have resident status.

If you’re not yet in Germany, you might have to pay your deposit from abroad. It can be hard to open a German bank account without actually being in the country, so this might mean making an international money transfer to cover the deposit amount. If you’re transferring a large amount of money across currencies, it’s important you get the best deal available. One smart option is to get a Borderless account from TransferWise. With this, you can hold 15 different currencies all in one account (including GBP, USD and EUR). It’s like having a local bank account which you can use to pay like a local, wherever you need it. And if you need to, you only pay a small flat charge to transfer cash from one currency to another and gives you the real exchange rate – the one you find on Google.

What kind of taxes and fees will I need to pay?

Once you add up all of the fees you’ll have to pay as a buyer, you can expect to add around 10% of the property price onto your bill. Fees and taxes include:

  • Property sale tax ( grunderwerbsteuer ): In the region of 3.5–6.5%
  • Notary fees: Usually 1.2–1.5% depending on the circumstance
  • Registration fees: Normally 0.8–1.2%
  • Estate agents fees: If you agree to share these with the seller, you’ll need to pay these. Typically they’ll be 1.5 – 3% (but can go up to a huge 6%) of the purchase price, plus VAT at 19 per cent

Buying a property is a big – and exciting – step, but navigating the system in a new country can be a challenge. Luckily, buying your dream home in Germany should be fairly straightforward if you follow these steps, and find the right local help if you need it.

Good luck with finding, buying and settling into your new home in Germany.

Fact Sheet

Buying In Germany

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:


Type Amount Who Pays
Buyers Agent Buyer
Estate Agent 1.5% – 3% Seller or Shared
Property transfer tax (grunderwerbsteuer) 3.5% – 6.5% Buyer
Notaries fees 1.2% – 1.5% Buyer
Registration fees 0.8% – 1.2% Buyer
Property Deposit 40% Buyer

Apart from the estate agent’s fees, costs are typically fixed by regional governments. They vary somewhat across Germany, hence the ranges shown above.

The contracts

Contracts are in German and signed in the presence of a notary. You should ensure you fully understand the contract before signing and bring an interpreter with you if necessary. You have the right to have a translator with you, but you will have to supply (and pay) them yourself. In some areas, you may be able to find a notary who is bilingual.

As you will be arranging to finance for the property at the same time as you are arranging the sale, it’s important to include an exit clause in the sale agreement that gives you a way out if you can’t arrange a mortgage.


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    • chimdiwan669

      Thank you for your comments.

      If there is any subject you would like us to post on please feel free to let us know.

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