Buying a house in Germany is an attractive option for many foreigners. Having come to Germany to work or study, it may be that you are considering buying a house here. It could be the case that Germany has become the centre of your family’s world, and now it is time to commit to settling down here. Maybe you are in your golden years and are seeking to retire to Germany (see our page “Retiree Residence Permit in Germany” to find out more). Whatever reason you may have, this page aims to provide you with the advice needed when it comes to buying a house in Germany.

If you require specialised advice on how to purchase property in Germany, please consider contacting our lawyers directly. We can be reached by phone, email or through our contact form. Our lawyers work with clients from all over the world and know the difficulties facing those looking to work with the German legal system and bureaucracy. Contact us today, and we can work together to achieve the best results for you!


The German Property Market

In comparison to other countries, the rate of house ownership in Germany is relatively low. Approximately half the population own their own homes in Germany. However, buying a house is now proving to be more popular, especially for foreign professionals living and working in Germany. Renting has an established history in Germany as in many cases, rent prices are pretty reasonable in Germany. Added to this, generally, strong rent controls prevent the costs from fluctuating too much over time.

Long term interest rates are forecasted to stay relatively low. German buyers tend to be risk-averse, and the properties they purchase are usually “properties for life“. This is one of the reasons why the rate of ownership is low compared to other countries of similar standing. With this in mind, the German market is now proving more attractive to outside purchasers. In contrast to traditional German buyers, foreign buyers tend to be more willing to “dive in” and make purchases. This should not be seen as a surprise, as the German market is relatively stable, but prices (especially in major cities) are rising in certain areas.

It should be noted that for older properties (especially in the Fachwerkhaus – timber-framed style), there may be rules in place regarding the alterations that an owner can make to their property. These can be limiting for the purchaser. There may also be regulations in place regarding environmental considerations. These types of concerns can complicate the process of purchasing a house in Germany. Working with experts in the field of German law may therefore be advantageous.


Differences in the Market within Germany

The German property market varies significantly according to where a person finds themselves looking. Big metropolitan cities such as Hamburg, Cologne, Frankfurt, and Berlin will be considerably more expensive than more rural areas. Therefore, when purchasing a property, bear in mind whether living in and around a metropolis is in your interest. If you are working in a city, living nearby is worth considering; however, if you plan to retire to Germany, looking outside of the cities may be better for you. With impressive motorways, an integrated public transport system and smaller towns which offer many amenities, smaller towns and villages in Germany may be exactly what you are looking for.

Even when dealing with the major cities, there are differences to consider. Compared to the other metropolitan areas, Munich is the most expensive of the big cities for buying and renting properties. In Munich, you can expect prices of over €7000 per square metre, whereas even in Berlin, it is possible to find similar-sized properties where that cost comes in at between €3000-4000 per sq. metre. Of course, for more central properties and those in great locations, buyers can expect to pay €10,000+ per sq. metre.

Frankfurt, Düsseldorf and Cologne are other cities in which the prices will be pretty high. Although not high as Munich, buyers can expect to pay more in these cities than they would for many properties in Berlin. In comparison, cities such as Bremen, Hannover and Dortmund are usually much more affordable. However, in the east of Germany, in the former GDR states, buyers can find houses and other properties at a more discounted rate. Even in big cities such as Dresden and Leipzig, it is possible to find properties for prices much lower than can be expected for properties in cities such as Munich.

Certain cities will have more opportunities than others. This is the case for jobs, schools, universities and public amenities. Such cities such as Munich, Berlin and Frankfurt are particularly suitable for investment properties. However, even in more affordable cities, the infrastructure in Germany is impressive. Most of Germany’s big cities can access major international airports, motorways between cities, and public transport networks.

Availing of advice from an advisor in Germany is, of course, to be recommended. Working with a professional will allow you to outline your requirements, your budget and your expectations. With your criteria outlined and working collaboratively, your dream of buying a house in Germany can be achieved.

If you have a particular issue or legal question concerning German Law, you can contact our law office anytime. Our lawyers for Expats in Germany can be reached by phone, email and also provide video conferencing options. For more legal information, please visit our Lawyers for Expats in Germany page.

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The Process of Buying a House in Germany

Buying a house in Germany involves the following steps:

  • Decision on which mortgage to pursue: Find out what you can afford and how well you qualify for a mortgage. There are purchase fees which must be covered as well. Sometimes these purchase fees, when combined, can be up to 10-15 % of the purchase price. Finding the right mortgage and understanding the amount you can borrow from the bank is critical for knowing your market.
  • Finding a property: Finding a suitable property will depend on your personal situation. Websites will provide the broadest range of properties available. Working with an estate agent is another way in which to find your dream German property.
  • Contact the seller: Contact the seller and start the negotiation. Make sure to have our legal professionals in your corner as we will be able to analyse the price they present and whether it is according to what the going rate should be.
  • Reserve the property: As the German market can be pretty competitive, it is advisable to reserve the property once it has been agreed upon. This will give you time to finalise your mortgage arrangements. Securing a property will generally involve paying a fee, but this is an essential step in popular cities such as Munich.
  • Finalise the mortgage: Present the details to the different banks and establish which offer is most suitable for you. We can help you when it comes to the necessary analysis. Once a decision on which mortgage to pursue has been made, the application for that mortgage can begin. You can now sign the mortgage contract at the end of this process if you wish to commit to it.
  • The purchase contract: At this point, the purchase contract between you and the seller can be drafted. Our lawyers will analyse every aspect of the agreement to ensure that you get a fair deal. Once the purchase contract has been agreed upon, it can be signed at the public notary’s office. Once it has been signed, the notary will register the priority notice in the land register, and you will be on your way to becoming the official owner.
  • Paying the costs: Paying the seller the down payment and arranging the transfer of the loan amount with your mortgage provider allows the property to come into your possession. From here, you will then pay the property transfer tax, and the property will be on its way to your hands.

As can be seen, this is a long process, and it can also be complicated. Working with an experienced German partner can quicken the process, and it may be reassuring to know that you are on the right path.


Buying a House in Germany as a Foreigner

There are no restrictions in place for foreigners looking to buy a house or other property in Germany. This rule applies to those looking for a place to live and for those looking for an investment property. This rule applies regardless of whether the buyer is an EU citizen or not an EU citizen.

There are many German property websites such as immobilienscout24.de and immonet.de, which provide their information in German. This can prove challenging for those who do not speak German. This can also be an issue when dealing with sellers and with the bureaucracy around buying a house. Working with our legal professionals means that you can be assured of straightforward advice and counsel in English. Our lawyers will ensure that the small print is read, understood and thus, speed up the process.

Should you eventually move from Germany, the house can still be used as a rental property. As stated, renting is very popular in Germany and therefore, benefitting from your property after moving is very likely. Having that property available and under your name in Germany will benefit your children and other family members as well.


Our Services as Your German Partner

As lawyers who regularly work with those new to Germany, we can provide solid financial and legal advice. We will advise you on aspects such as:

  • Location of your property: which areas to consider purchasing in depending on your personal situation and your reasons for buying a house in Germany. Knowing where to look is key to a successful purchase. Having a partner in Germany with knowledge of the local area is an essential step to finding the perfect location.
  • Financial advice: once you have provided the background information of your financial situation and your personal preferences regarding payments and mortgages, we can advise you on how to approach banks for loans. We will also notify you of the process of purchasing. Working with English-speaking bankers is important but having a German partner to read over the paperwork is vital.
  • Bureaucracy: even if you have a strong level of German, the process of purchasing a property is complex. The vocabulary you can expect to come across is challenging even for fluent German speakers! The paperwork you will face in this matter is extensive. However, once our lawyers are at your side, we will look after the bureaucratic elements. This ensures that you will not face any surprises in the future and thus, speed up buying a house.
  • Contract analysis: when it comes to your mortgage and the purchase contract, our lawyers will examine the conditions in place. Some properties (especially older ones, including those in the “Fachwerk” style) may also have clauses restricting alterations.  This must be considered when looking to purchase a property.
  • Legal analysis: our lawyers will examine any regulations in place concerning environmental law and alert you to their existence. There may also be other regulations that need to be considered from the Baugesetzbuch (Federal Building Code) or other state regulations.
  • Tax advice: our professionals will advise you on what taxes need to be paid to purchase the property. Ensuring that all financial necessities are covered is crucial to ensuring a smooth purchase. Once the property has been purchased, we can advise you on any further property taxes which need to be considered.
  • Landlord legal counsel: following the purchase of the property, our lawyers can advise you on your rights as a landlord if you plan to use your property as a rental property. We advise landlords all over Germany in their rights, as without knowing them, landlords can face complex legal cases. Our Landlord Lawyer in Germany page provides more information on our services in this field.

The above-listed services are just some of those which we offer our clients. Our services will depend on the needs of the client and the situation they are facing. If you would like to find out how our lawyers can help you, don’t hesitate to get in touch with us by phone, email, or contact form.


The Advantages of Buying a House / Property in Germany

In comparison to renting, buying a house/property provides the owner with a greater level of freedom. Owning a home allows for greater stability and security for the owner, and the property in question becomes your property as opposed to the one you rent. This can be beneficial when it comes to future inheritance matters for your family. Still, in the present/medium-term, it allows for pet ownership, provides for alterations to be made to the property, and can be sold in the future if needed.

Even if you do not live in the property or leave Germany, there is a strong demand for property. This applies to both the purchasing market and the rental market. Therefore, there is the possibility of selling the property for a profit later or renting out the property if needed.


Germany as a Place to Live

There are many reasons why Germany is an attractive place to live. From its strong economy and diverse job market to the available educational opportunities and its safe and stable reputation, Germany is a very popular destination for inward migration. Located at the heart of Europe and a strong member of the European Union, Germany may be the perfect location for you to set up a business, retire to, study or look for a job. With a growing international community within Germany and a wide range of multinational companies and other groups established within the country, there are many jobs in Germany where English is the primary language of the office. German language lessons are also widely available for those seeking to master the language.

Once established and settled in Germany, buying a house is an understandable pursuit. Having a legal partner in your corner to examine contracts, read the small print and handle the (sometimes extensive) bureaucracy is the right move. The many benefits and opportunities available from living in Germany are open to you and your family with your property. It is the ideal way in which to safeguard your children’s future.


Your Legal Partners in Germany

At Schlun & Elseven, we are experienced lawyers when it comes to working with those new to Germany. As immigration law specialists in Germany, we highly specialise in helping people enter, live, work, and study in Germany. From our offices in Cologne, Aachen and Düsseldorf, we work with clients worldwide. We also have additional conference facilities in Berlin, Hamburg, Munich, Stuttgart and Frankfurt. Furthermore, our lawyers can advise through video conferencing and email to stay in touch wherever you are in the world.

Once our clients have settled in Germany, our legal team provides additional assistance with our Lawyers for Expats services. We aim to provide our clients with comprehensive assistance when it comes to living in Germany. As a full-service law firm, comprehensive service is what can be expected from us. If you want to purchase a house or other property in Germany, you should look no further than our lawyers for assistance! Contact us today to find out more.

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