How to buy an apartment in Germany step by step, and how long can this process take? What are the additional costs for this? How much on average does German real estate cost? A detailed analysis is inside.

Anyone can buy a house in Germany. The advantage for local residents will only be in the registration of the mortgage, as foreigners need to make a much larger deposit.

Step-by-step procedure for buying real estate in Germany

1. Searching for a property

The competition in the real estate market in Germany is very high, and the choice of properties is small. So, have patience and plan enough time to find the right property for you.

2. Checking out and reserving the property

Before buying a property, you should look at the land registry (Grundbuch)—there you can see who owned the property before and who owns it now, if there are any encumbrances, etc. It is recommended to look at the following documents: the articles of incorporation, minutes of meetings of owners, the economic plan, and the calculation of utilities.

After a thorough check, reserve the property by making an offer to the seller to buy it.

3. Opening a bank account

Payments can be made from a German account as well as from any other foreign account.

Russians without permanent resident status are not allowed to open accounts in German banks. Buyers from Russia can transfer money from their account in a third country directly to the seller or builder.

4. Concluding the deal

You have to go to a notary to sign all contracts. Immediately after signing the sales contract, the notary sends an application to the local court (Grundbuchamt) for the preliminary registration of the buyer as the new owner.

5. Payment

In Germany, there are two popular methods of payment: payment directly to the seller or through a notary public trust account. In the second case, the notary creates a special escrow account that is tied to a specific transaction. Once the buyer transfers the full amount there, the notary redirects it to the seller.

In all payment options, the seller receives the money only after the notary confirms that all necessary conditions for the purchase have been met. These conditions include pre-registering the title in favor of the buyer, obtaining a certificate from the bank authorizing the removal of encumbrances (if any), and obtaining permission from the home manager to sell and buy.

6. Registering the new owner

After receiving the full amount, the notary sends the application to the Land Court for the final registration and, at the same time, the removal of the provisional.

All data is stored in the electronic cadastre (land register). The owner has the right to request an extract from the registry at any time.

It usually takes two to four months to complete the transaction.

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Additional costs when buying real estate in Germany

Ancillary fees are a significant expense when buying a property in Germany. They can amount to about 10% (or even more) of the purchase price of the property. Let's list these associated costs.

Property transfer tax (Grunderwerbssteuer)

This tax is usually between 3.5% and 6.5% of the purchase price. The exact rate will vary depending on the region in which you purchase the property. Berlin, for example, has a rate of 6%, and Munich has a rate of 3.5%.

Notary fees and property registration

The approximate cost of notary fees and registration of ownership in the land registry is 1.5–2% of the purchase price of the property.

Real estate agent's fee (Maklerprovision)

Real estate buyers in Germany can pay no more than 50% of the fee intended for the agent. This rule has been in effect in the country since December 2020, when a new law came into force.

The amount of the real estate agent fee in Germany is not clearly specified, but on the local market, there is a tacit rule that the maximum amount should be 7.14%. This means that you, the buyer, will not have to pay more than 3.57%.

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The average cost of real estate in Germany

The cost of buying a home in Germany depends greatly on the location, condition, and size of the property you need. Here are the data on the cost, which is provided by the service Numbeo.

An apartment of 90 square meters in Germany can be purchased for between $500,000 and $650,000.

The price to rent a one-bedroom apartment in Germany is about $700–$900. It is possible to rent a two-bedroom apartment in the country for $1300–1700.

Utility bills in Germany average $285 (plus $38 for the Internet).

Buying a house in Germany with a mortgage

Foreigners can take out a mortgage to buy a house in Germany, but they will need to make a larger deposit than residents. It is desirable to have 20–30% of the property value as equity.

Mortgage processing in Germany takes about a month, and the loan is usually granted for an average of 20 years.

The interest rate on a 20-year fixed-rate mortgage is 2.35%.

On our website, you can find the right real estate agency in Germany or speak directly to the agent.