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‘Be patient’: What you should know about buying property in Germany

If you're planning on staying in Germany long term it might make sense to buy a property rather than renting. So what should you know about the process?

'Be patient': What you should know about buying property in Germany
If your dream is to live in the Germany countryside, there are options available, such as this home which was for sale in rural Brandenburg. Photo: DPA

Have you ever dreamed of buying your own Hamburg flat, converted farmhouse in Bavaria or family home in Düsseldorf?

We’re not surprised if you have. And some of our readers have even taken the plunge and bought their own property. 

We asked them to share their most valuable tips. 

READ ALSO: What’s happening to house prices and rents in Germany amid the coronavirus crisis?

What’s the most important advice you can give to someone buying a property in Germany?

Readers responses ranged from warnings about keeping a good chunk of money aside for fees, to tips about getting a second opinion.

Andy Doran in Trier, Rhineland-Palatinate, said those looking to purchase a property should “expect to spend at least 10 percent of the purchase price on fees”.

READ ALSO: Housing in Germany: Why are fewer young people buying their own homes?

Others also highlighted these costs. 

Rob Harrison, who lives near Munich, said: “The notary and real estate agents fees are really high. There is no competition at all. You need to budget 10 percent of the price of the real estate.”

A neighbourhood of newly built homes by Munich. Photo: DPA

In Germany just under half of the population own their own homes, the second lowest rate in Europe after Switzerland. But our readers advised those thinking of buying to go for it.

“Do it!,” said Laurie Hall in Upper Bavaria. “You’ll be amazed at the relatively low prices compared to equivalent locations in the UK for example.”

“Nowhere in the UK can you buy a large house in genuinely rural countryside but still within commuting distance of a large city like Munich and, even if you could, it would cost you many times more than it does here. And nowhere in the UK can you do all that and still be only 30 minutes from the nearest mountains and lakes, with consistently warm summers and snowy winters.”

Other respondents, however, warned of Germany’s notoriously slow bureaucratic system. 

Sandra Leaton Gray in southern Baden-Baden said  “Be prepared for everyone involved to go on holiday frequently, usually at precisely the time documents need completion or authorization needs to be given.”

Readers also said that you shouldn’t do the process alone.

“Consult an advisor,” said Oladapo Ogidi, who is based in Munich.

What common mistakes do people make when buying a property in Germany and how can they be avoided?

Buying a property in a country where you’re a native speaker is hard enough. So abroad it can be much more difficult and stressful. 

There are ways, however, of taking the pain out of buying your own place – and avoiding making mistakes.

SEE ALSO: ‘It’s not that hard:’ The beginner’s guide to buying a home in Germany

As with most things, money should be taken into account. The Local readers advised people not to underestimate the costs involved.

Others said a common mistake was trusting the broker (Makler) completely and not doing any research yourself. 

Respondents also said you shouldn’t pack it all in and that a common mistake was giving up.

It can feel frustrating because the housing market in Germany is slow compared to some other countries, perhaps because it’s still not the norm for many people to own their homes. 

“So there just are not that many houses up for sale in some places,” said Laurie in Munich. “It may take many months or even years to find a house you like within your budget.

A house which was for sale in rural Born in eastern Mecklenburg-Western Pomerania. Photo: DPA

“Be patient. And have faith because when that perfect house does come on the market, the up side is that you will have fewer competing buyers.”

Here’s another thing to note: to complete the property purchase process, it is mandatory that the buyer and seller hire a notary or solicitor to handle the legal work of buying a home in Germany, which is also known as conveyancing.

The notary not only certifies that the property is available to sell, but he or she also draws up the real estate purchase contract (Kaufvertrag).

Others also said it’s a good idea not to rely solely on notaries and to get additional advice from someone “to check the finer points” before you go through with the transaction (it will likely be one of life’s most expensive purchases).

“We found dealing with our notary rather like dealing with a very junior lawyer who hasn’t fully thought through the implications of what they are writing,” said one reader.

READ ALSO: The hidden costs of buying a home in Germany

What are some of the hidden costs that buyers need to know about?

The mere sight of the words ‘hidden costs’ probably make us all feel queasy. Unfortunately there appears to be a lot of Nebenkosten involved in house buying in Germany.

The closing costs include the real estate transfer tax/stamp duty, notary fees, land register fees and any real estate agent fees.

Usually, all these purchase fees can be anything between 5-15% of the property price, experts reckon.

You should remember to set money aside for the notary fees and the property upgrade services, our readers said.

Leaton-Gray said she and her family had to pay real estate transfer tax/stamp duty (Grunderwerbsteuer) “on our projected leasehold payments for the entire remaining life of the lease”. 

Readers also pointed out that it can cost thousands of euros to have your contract officially translated. You also have to pay for the contract to be read out loud in German, an official requirement which usually costs a few hundred euros. 

Photo: DPA

Respondents said the contract is read aloud very quickly and so is difficult to understand even if you speak German. 

“This was particularly pointless but a legal requirement,” said Leaton-Gray.

“If you are not competent in German, then the notary will insist on a translation being made so you know what you are signing,” added Harrison who also pointed out the high speed at which the contract is read out loud.

In Germany, a deposit of around 20 percent is usually required to get a mortgage.

And one more thing: “When we registered as residents, the local Amt (office) then told us we were liable for another 20 percent tax on the annual rental value,” said Leaton-Gray. “We were amazed neither the Maklerin (broker) nor the notary had mentioned this.”

When it comes to renovations readers told us there are “relatively low labour costs” in Germany. But the cost of materials and equipment is high. 

“Of course you can try to persuade your builder to use cheaper materials, but perhaps you should learn to be more German about it – it does make sense to pay a little more for something that will last longer,” said one respondent.

Any other big surprises?

For Harrison, the biggest shock was a lack of a proper survey of a property, which is the case in the UK and required by all mortgage brokers. 

“One owner refused point blank when I said that I wanted an architect to look at the property before I bought it,” said Harrison who didn’t opt for that one in the end.

His current home seemed okay when he bought it but “we’ve now probably spent around €100,000 fixing everything,” he said.

Member comments

  1. Hello, just a little side note to the article about buying property in Germany…they remove the kitchen! So don´t forget to factor in a new kitchen.
    Also, if you can, move in the warmer months, there is a strong likelihood that the oil tanks will have been drained and delivery can take weeks!!

  2. We also found that unless you have a “permanent residency” it is difficult to get a loan. Only one bank would give us a loan at a much higher cost so we postponed buying until we have permanent residence.

  3. I could not get any mortgage at all, until I got the Niederlassungserlaubnis (Permanent Residence visa). I don’t know why, but all mortgage providers I found had this rule.

    I had a very good Notary though. He made me have a native German speaker with me who also speaks good English, but no official translator. My colleague and I went through the purchase contract the night before so I knew what was in it and where I had questions or wanted clarification. Like legal speak anywhere, it is not always understandable to a non-lawyer. The notary was not too fast, and he stopped to explain for any question. You are signing, and a mistake can cost a lot of money to resolve later. Better know what you are doing!

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LIVING IN GERMANY

REVEALED: The most commonly asked questions about Germans and Germany

Ever wondered what the world is asking about Germany and the Germans? We looked at Google’s most searched results to find out – and help clear some of these queries up.

Oktoberfest
Hasan Salihamidzic, the sports director of FC Bayern, arrives with his wife at Oktoberfest in full traditional dress. Photo: picture alliance/dpa |

According to popular searches, Germany is the go-to place for good coffee and bread (although only if you like the hard kind) and the place to avoid if what you’re looking for is good food, good internet connection and low taxes. Of course, this is subjective; some people will travel long stretches to get a fresh, hot pretzel or a juicy Bratwurst, while others will take a hard pass.

When it comes to the question on the bad Internet – there is some truth to this. Germany is known for being behind other rich nations when it comes to connectivity. And from personal experience, the internet connection can seem a little medieval. The incoming German coalition government has, however, vowed to improve internet connectivity as part of their plans to modernise the country.

There are also frequent questions on learning the German language, and people pointing out that it is hard and complicated. This is probably due to the long compound words and its extensive grammar rules, however, as both English and German are Germanic languages with similar words in common, it’s not impossible to learn as an English-speaker.

Here’s a look at some of those questions…

Why is German called Deutsch? Whereas ‘German’ comes from the Latin, ‘Deutsch’ instead derives itself from the Indo-European root “þeudō”, meaning “people”. This slowly became “Deutsch” as we know it today. It can be a bit confusing to English-speakers, who are right to think it sounds a little more like “Dutch”, however the two languages do have the same roots which may explain it.

And why is Germany so boring? Again, probably a generalisation, especially given that Germany has a landmass of over 350,000 km² with areas ranging from high rise, industrial cities to traditional old town villages and even mountain ranges, so you’re sure to find a place that doesn’t bore you to tears.

Perhaps it is a question that comes from the stereotype that Germans are obsessed with being strict about rules, organised and analytical. Or that they have no sense of humour – all of these things being not the most exciting traits. 

Either way, from my experience I can confirm that, even though there is truth to German society enjoying order and rules, the vast majority of people are not boring, and I’m sure if you come to Germany you’ll meet many interesting, funny and exciting people. 

READ ALSO: 12 mistakes foreigners make when moving to Germany

When it comes to the German weather, most people assume a cold and cloudy climate, however this isn’t entirely true. While the autumn and winter, especially in the north, come with grey skies and sub-zero temperatures, Germany can have some beautiful summers, with temperatures frequently rising above 30C in some places.

Unsurprisingly, the power and wealth of the German nation is mentioned – Germany is the largest economy in Europe after all, with a GDP of 3.8 trillion dollars. This could be due to strong industry sectors in the country, including vehicle constructions (I was a little surprised to find no questions posed on German cars), chemical and electrical industry and engineering. There are also many strong economic cities in Germany, most notably Munich, Frankfurt am Main and Hamburg.

READ ALSO: Eight unique words and phrases that tell us something about Germany

Smart and tall?

Why are Germans so tall? They are indeed taller than many other nations, with the average German measuring a good 172.87cm (or 5 feet 8.06 inches), however this may be a question better posed to the Dutch, who make up the tallest people in the world.

Why are Germans so smart? While this is again a generalisation – as individuals have different levels of intelligence in all countries – this question may stem from Germany’s free higher education system or their seemingly efficient work ethic. Plus there does seem to be some scientific research behind this question, with a study done in 2006 finding that Germans had the highest IQ in Europe.

So, while many of the questions posed about Germany and Germans on Google stem from stereotypes, we can confirm that some aren’t entirely made up. If you’re looking to debunk some frequently asked questions about France and the French, check out this article by our sister site HERE.

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