How high are realtors’ and lawyers’ fees in Germany? What about other property purchase costs?
|Real Estate Transfer Tax||3.50% - 5%||buyer|
|Notary Fees||1.20% - 1.50%||buyer|
|Registration Fees||0.80% - 1.20%||buyer|
|Broker´s (Makler´s) Fee||1.5% - 3% (+ 19% VAT)
1.5% - 3% (+ 19% VAT)
|Costs paid by buyer||7.23% - 11.27%|
|Costs paid by seller||1.79% - 3.57%|
|ROUNDTRIP TRANSACTION COSTS||9.07% - 14.84%|
| See Footnotes
Source: Global Property Guide
There are no restrictions on foreign nationals buying property in Germany. Financing is possible for foreigners, but should not be expected to cover more than 60% of the purchase price.
The process of buying property in Germany involves the following:
The parties can freely decide on payment terms. The buyer is advised to check the property for any major defects because the notary is not responsible for this. The seller is required to disclose any hidden defects, but is not obliged to point out any defects that should have been obvious to the buyer. The Notar is responsible for the legal work and contract obligations, and checks that no liabilities exist.
It takes an average of 35 days to complete all the four procedures needed to register a property in Germany.
The round trip transaction costs include all costs of buying and then re-selling a property – lawyers’ fees, notaries’ fees, registration fees, taxes, agents’ fees, etc.
Real Estate Transfer Tax (Grunderwerbsteuer)
Real estate transfer tax is levied at 3.5% to 5%, depending on the federal state where the property is located.
Real estate transfer tax is levied at 3.5% in the federal states of Bavaria, Hesse, Mecklenburg-Pomerania and Saxony; at 4.5% in the federal states of Berlin, Bremen, Hamburg, Lower Saxony, and Saarland; and 5% in the federal states of Baden-Wurttemberg, Brandenburg, North-Rhine Westphalia, Schleswig-Holstein, and Thuringia. Real estate transfer tax is 5% in Rhineland-Palatinate and Saxony-Anhalt as of 01 March 2012.
Real estate transfer tax is due about four weeks after the notary deed has been signed by buyer and seller.
Notary fees are fixed by law and depend on the kind of agreement and the value of the property. Notary fees usually range from 1.20% to 1.5% of the purchase price. German law requires that sale and purchase agreements be notarized.
|PROPERTY VALUE, (€)||RATE €|
|Up to €1,000||€10|
|€1,000 – €5,000||increase of €8 for every €1,000|
|€5,000 – €50,000||increase of €6 for every €3,000|
|€50,000 – €5 million||increase of €15 for every €10,000|
|Source: Global Property Guide|
The buyer mus pay registration fee to have his name entered in the local land registry (Grundbuch) as the legal owner. Registration fee is fixed by law depends on the value of the property.
Value Added Tax (VAT)
Value Added Tax (VAT) is levied at a flat rate of 19%.
Agent’s fee in Germany varies in each federal country and ranges from 3% to 6% plus 19% VAT. The actual value is negotiable and depending on the agreement negotiated between parties, borker´s fee will be paid either by the buyer or the seller, or split between the two.
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