British in Germany

Living in Germany


Baufinanzierung : How to Find a Home in Germany

by Mark Lauterwein

Low mortgage rates mean that buying a house in Germany is currently a viable option for expats with a long term intention of staying in the country. Experts anticipate that prices will remain stable for the foreseeable future in most areas, although there are exceptions i.e. Munich. Although the stability of the market is good news for those looking for a home to call their own it is not good news for those looking to invest in the market for profit. Aside from the fact the prices do not fluctuate a great deal, all profits from a resale would be subject to heavy taxation.

There are no For Sale signs to be seen on German streets . Newspapers are the normal vehicle for offering property for sale. "Von privat" means that no agent (Makler) is involved in the sale of the property. However Immobilienmakler are normally involved in the selling process. As in any country the buyer needs to carefully look into the details of the offer. If a property is being offered at a price that seems conspicuously low in comparison to other properties of a similar type there will inevitably be a reason for this: it may be that the property requires extensive refurbishments (renovierung / sanierung).

If the advert speaks of grosszügige Räume (large rooms) it would be as well to look in to the costs of heating and running the property. Likewise, if the blurb mentions für Schnellentschlossene (for quick decision makers) then it would also be prudent to exercise caution. After all, choices involving large sums of money should not be made quickly and it maybe that the buyer is being hoodwinked into overlooking something.

Most adverts in the newspaper housing section do not include the address of the property thereby forcing the house hunter to deal with the agent. Some agents try to push “exclusivity contacts” which forbid dealing with other agents. There is little benefit in this: it is always advisable to keep options open. There is no law regulating commissions to agents so these are always negotiated: a ballpark figure is anything between 5 and 7%.

The seller should be consulted in order to establish what role the agent has had in selling the house and also to ensure that no more than one agent is involved in the transaction. Otherwise there may be a risk of paying multiple commissions! On top of this there are additional fees that constitute a further 10% of the property value. Chiefly these are the property transfer tax and administrative fees. Once the price the has been agreed the contract must be signed in the presence of a notary who also charges a fee. This covers the registration of the property in the buyer’s (or the bank's) name.

Once all this has been taken care of, it only remains to sort out the actual financing of the house. In order to sort out an appropriate Baufinanzierung , or mortgage, the buyer should seek an unabhängige Beratung (a consultation with independent advisor).



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