Kaufnebenkosten
(Purchasing Costs)
The purchasing costs include the property transfer tax, notary and land registry fees, as well as real estate broker commission. You have to pay them when building or buying a property, in addition to the property costs. It is quite normal for German lenders to expect you to pay at least the purchasing costs from your savings.
1. Real estate commission (0–3,57%)
This fee is paid to the real estate agent for successfully supporting the buyer to sell the property. It can range from 0% — 6% on the property price. With the value-added tax (VAT) of 19% in Germany, the total commission fee will lie anywhere between 0–7,14%. Since a change in law at the end of 2020, buyers pay a maximum of 50% of the fees, i.e., 3,57%.
2. Property transfer tax (3–6,5%)
The second-highest fee associated with is the property transfer tax (Grunderwerbssteuer). The tax amount will vary depending on which region of Germany the property is purchased. As of 2020, the tax ranges from 3,5-6,5% of the purchase price. For example, in Berlin, the property transfer tax is 6%, whereas in Munich, it is only 3,5%. The property transfer tax is an important factor in transferring the property rights to the new owner. Only after the tax office has confirmed that the property transfer tax has been paid will the buyer be entered as the new property owner in the German land registration (Grundbuch).
3. Notary & land registry fees (1,5%-2%)
In Germany, purchasing property only becomes legally binding when a public notary registers it. The associated notary fee is typically 1.5-2% of the purchasing price. See the notary fee glossary for details. Among other things, the notary will take care of drafting the purchasing contract, entering the buyer into the land registration, and generally taking care of all communication with the German tax office. It is up to the buyer to decide which notary they wish to use.
Want to know exactly what your costs will be? Use our purchasing cost calculator to find out the detailed costs for your property purchase.
