Purchase a Property in Germany - Guidelines for Buyers

Purchase a Property in Germany

Updated on Thursday 30th May 2024

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The German real estate market is a stable one, providing good investment opportunities for both local and foreign businessmen. Foreign ownership is permitted in Germany, and an important advantage of purchasing a property in Germany is that a foreigner is not required to have to have a residence permit, as may be the case in other countries.
Our lawyers in Germany also specialize in real estate matters and are ready to answer any questions concerning property purchases by residents, non-residents, and in general any foreign investor, irrespective of their country of origin.
Read below to find out more about the requirements when you purchase a property in Germany and reach out to our team for complete assistance during the process.
Quick Facts  
 Homeownership in Germany  49,5 % (2021)

 German property market

 Stable, attractive to investors, with a high demand for rental properties

 Property search

 Real estate agents, websites, property auctions, newspaper/online ads

 Residence permit required (YES/NO)  NO

 19% (business and sole traders must also apply for VAT Registration Germany for purchasing property)

 Fees and taxes

 Property transfer tax (Grunderwerbsteuer): 3.5% - 6.5% of the purchase price;
Notary and land registration fees: 1.5%–2% of the property’s purchase price;
Additional real estate agent, German lawyers or accountants fees;
Property tax within one month after the finalization of your purchase.

 Necessary documents

Passport or ID;
Proof of financing;
Purchase agreement;
Notary certificates;
Land registry extract, etc.


Non-residents may need to pay a larger deposit;
It can be helpful to get a mortgage agreement in principle (pre-approval); Mortgage lenders offer the possibility to borrow the full value of the property, up to 100%;
Most homebuyers in Germany choose fixed-rate mortgages for a fixed rate of 10 years.

 Deposit value 

 Many buyers in Germany will need to pay a downpayment, with 20% being a common amount; Non-residents may need to pay a larger deposit.  

 Can obtain a resident visa (YES/NO)  NO
 Personal loans allowed (YES/NO)

 YES (but not recommended)

 Average house prices for single-family and duplex homes (approx.)

  5,000 -11,000 EUR per square meter (2022)

 Buying a property in Germany with existing tenants

 German rental law protects tenants from sudden rental price hikes and eviction;
Cancelling a rental contract for personal use is only allowed under specific circumstances.

 Advantages of purchasing a property in Germany

Stable real estate market;
Strong legal protection;
Low-interest rates;
Strong infrastructure and economy;
Easy process;
Foreigners can also buy a property in Germany.

 Assistance for purchasing a property in Germany (YES/NO)  YES, we offer assistance with property registration and legal matters regarding real estate in Germany
Physical presence required (YES/NO) NO, our German lawyers can handle the procedure remotely.

Legal framework for real estate

Property Law (Sachenrecht)


- find property,

- pay deposit,

- obtain mortgage (if applicable),

- draft documents,

- sign purchase-sale contract,

- register with authorities, etc.

Local bank account required Recommended by our lawyers
Due diligence

Our team recommends and assists in the due diligence processes for safe and successful real estate transactions.

Types of properties in Germany

- residential,

- commercial,

- industrial,

- land

Registration of ownership

Must be entered in the Land Register

Based on a progressive scale

Based on a progressive scale

Mandatory insurance (YES/NO)


Assistance schemes and loans

- subsidised loans,

- repayment subsidy

Documentation verification (YES/NO)

YES, our attorneys can verify the documents of the purchased property.

Land registry excerpt – characteristics

Provides official documentation of the property's details, including ownership, size, location, etc.

Tax number

Required to buy a property in Germany

Constructing a house

We can help you obtain the necessary building permits.

Buying agricultural land

Might require additional permits and authorizations


Finding a property to purchase in Germany


The first step when wanting to acquire real estate in Germany is to search for the suitable property. Real estate properties are subject to some minimum legal requirements and a law firm in Germany can provide you the details about these requirements. Some of them refer to the roofing, windows and heating system, which is why a thorough real estate due diligence is required.

Property encumbrances or third party leases can be checked with the German Land Registry. The real estate due diligence at the Land Register is usually performed by a public notary, but for building verifications an architect is recommended.

Property due diligence is recommended in all cases, as it is the most effective step helping buyers make sure that the purchase is a safe one, and that the house is valuated accordingly. When properly performed, it will reveal the advantages of the said property, but also the issues that the buyers may have, the ones they will need to address after the purchase is complete (such as improving the house’s windows, reinstalling heating systems, and others).
Our attorneys in Germany will guide you accordingly so that you may proceed with this formal verification once you have chosen the desired property. In general, the issues clients look for during the property due diligence verification include the following:
  • Ownership: you will find out the ownership history, and when the first original title deed was issued;
  • Legal issues: any new home owner wishes to make sure that there are no legal impediments on the purchase; in this case, the encumbrances can have a legal or a financial nature; for example, after the verification you will find out if the property is or has been the object of a legal dispute; the due diligence will also reveal any tenant/leasing agreements that were concluded for the property; you will want any such agreements to have ceased at the time of the purchase;
  • Price: the due diligence will also serve as a basis for the property valuation; once any issues with the property are identified, you will be informed if the asking price is the correct one;
  • Construction issues: the verification will also reveal if the property is not observing any relevant construction rules, energy efficiency rules, and others; in special cases, such as for houses that are considered historic or heritage buildings, you will find out more about the rules and regulations you will need to observe for their restoration.
The due diligence report will produce important information about the property you intend to purchase in Germany. We advise our clients to schedule this process once they have found a property that meets their budget and criteria.

The sale-purchase contract when buying real estate Germany


Once all the verifications are done and the new owner and seller agree on the price, terms and conditions of concluding the transfer of property, a public notary will draft the purchase agreement. The notary will make sure all documents are correct and the contract will be signed in his or her presence. The contract will contain the obligations both seller and buyer have and the measures to be taken if any of those obligations are breached.

Parties have the right to choose the way the payment for the German property is made, respectively received. However, the buyer must know that until the property is not registered with the Land Register he or she will not own the purchased real estate. The Land Register is located within the German district court where the property was bought.

We are also at your service if you have inherited a property but need to contest a will in Germany in order to become its sole owner.

The following video lists the most important steps in the property purchase process:


Transaction costs when buying real estate in Germany


There are several costs attached to the purchase of property in Germany. These include the following:  

  • The property transfer tax between 3.5% and 6.5% depending on the region the property is located in; usually, this is payable within four weeks after making the purchase;
  • The notary fees can be approximately 2% of the property value; these can depend on the chosen notary, and we advise clients to keep in mins that these vary;
  • Buyers can also expect a registration fee, which depends on the registry with which this is made (however, an expected value can be around 1% of the property value);
  • The real estate agent’s fees should also be taken into account; these vary according to region, however, buyers can expect to pay prices around 3% of the property value; these are commonly shared between the buyer and the seller;
  • The new owner must also consider the 19% VAT rate.
Our German attorneys can give you more details about the costs you can expect when buying a property in the country. Because these costs differ on a regional basis, it is advisable to talk to one of our lawyers before you start the purchase process, so that you can receive updated information according to your area of interest.
If you are interested in tax matters, our accountants in Germany can give you complete information about the taxes for individuals, including those from rental income derived from the country. We can also answer questions about VAT registration in Germany.

Can foreigners buy real estate in Germany?

Foreigners can buy a property in Germany with no restrictions or residence permit, no matter if they are EU or non-EU citizens. However, purchasing a property in the country does not grant you German citizenship.
If you're from another country and want to sell or purchase a property in Germany, you can still do it even if you can't be there physically. Our German lawyers can represent you at the appointment when the property sale is finalized. This means you can approve the sale contract from your home country at a notary or the German embassy. This can be done by granting the lawyer power of attorney, which gives the legal authority to act on your behalf.
If you're interested in buying a property in Germany to rent out, you can do that too without any extra taxes or registrations. Homeowners who rent out their properties only need to pay the regular income tax in Germany.  
If you're not from Germany, you can still get financing to buy a property, but usually only for up to 60% of the property's price. Our German law firm has experience working with people from different countries and can help you through the process.

Mortgages in Germany

When buying a property in Germany, you can borrow money from a mortgage lender to pay for it.
You can usually borrow up to 100% of the house's value, but you will still need to pay for some other costs of buying a house, like purchase fees, with your own money. Some German banks provide loans to the full amount, but most loans are around 80% of the house's value. Foreigners might need to pay a bigger deposit upfront if they are interested in purchasing a property in Germany. 
Mortgage rates have increased in Germany during the second quarter of 2023, reaching a value of 3.28 percent. According to data, Germany is the second-largest mortgage market in Europe, however, mortgage lending was influenced by the recent rate increased, as well as the value of the interest rates. 
Our attorneys in Germany are available all over the country and can help you with obtaining mortgages for your dream property, even if you are a foreigner. 

Purchasing a property in Germany with sitting tenants

If you plan to purchase a property in Germany as a long-term investment, there are advantages to buying one that is already occupied by tenants. One such advantage is that rented properties usually cost significantly less than unoccupied ones. 
When you purchase a property in Germany with existing tenants, you won't have to go through the trouble of finding new tenants or figuring out how much to charge them for rent. However, German rental law safeguards tenants to prevent landlords from eviction and forcing them out to rent the property at higher rates.
If a tenant has been living in the property for a long time, you'll need to give them nine months' notice before someone else can move in. In some places, like Berlin, you might not be able to evict the tenant for up to ten years after you buy the property. If you happen to be in any of these situations mentioned above as well as other property disputes, please contact our lawyers in Germany. 

The real estate market in Germany

According to data from the Federal Statistical Office, there were 43.1 million dwellings in the country at the end of 2021.
For those wishing to know more about the country’s real estate if they are interested in buying a property in Germany, here are some interesting statistics and data:
  • Residential property prices decreased by 9.9% in 2023 on a year-on-year basis; this is the most significant decrease since the start of the data collection in 2000;
  • Property prices decreased by 1.5% on a quarter basis, and the price drops were more significant in large cities, such as Berlin, or Munich;
  • Even given these changes, the German real estate market remains an important one given its size and investments in residential construction have amounted to almost 7 billion euros between the months of December 2022 and November 2023.
 Our lawyers in Germany can provide you with information about the best regions to purchase properties in. You can also contact us for details about property registration with the German Land Register.