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Guide to buying a house in Germany

Many European countries do not have the same emphasis on owning property that we have in the UK. When it comes to how many people rent of the proportion who buy in Germany, it is pretty much a 50/50 split.

The price of houses in the country is relatively low for central Europe, making the idea of buying a sound investment, as well as ensuring you have a place to live. So if you have decided that purchasing is the right option, this is how to go about it.

Restrictions

There are no restrictions placed on foreigners wanting to buy houses in Germany – it is not a requirement that you are a resident, nor do you need to be from a European Union member state.

Choosing a property

In a similar way to the UK, homes can be sold either privately or through an agent in Germany, so keep your eyes peeled for adverts and head to the estate agents to view their selection. Unlike Britain, it is rare for signs to be put up on properties saying they are on the market, so you need to be more proactive.

Looking online and in local newspapers is a good idea, as well as spreading the fact that you want to buy around your expatriate community. This means word will get back to anyone selling a house and you can widen your search.

Being able to bypass using an agent is a bonus, but not always possible. They usually charge between three and seven per cent of the price of the house in fees, so find out whether it will be you or the person selling the property that will be paying them, as this can increase your expenditure significantly.

Moving house is relatively rare in Germany, so fewer properties come on the market as many people stay put for life. This means it may take a while to find your new home, but it is worth holding out for one that you really like in the ideal location.

While structural surveys are not commonplace, it is a good idea to get one done, so that you know you are buying a sound property that has no major problems.

Completing the purchase

Before making an offer on your dream home, ensure you have secured a mortgage, then you can put the process into motion. The first step is to make an offer, which of course, may be accepted or refused. Decide how much you are prepared to pay and up your figure accordingly if the original offer is refused.

Once this matter has been settled to both parties' satisfaction, a notary will draw up a contract of sale. This is a good point at which to finalise any mortgage arrangements, then sign the contract.

Putting your signature on the document does not mean that the property is now yours under German law – it must also be registered before this is the case and that is another job for the notary.

The government then checks that there are no issues in relation to the sale and four weeks pass then the property sale tax must be paid.

The contract

Expats who do not have a high level of German language skills should make sure they have the contract translated prior to signing it. Even those with a good working knowledge may find legal phrases difficult to decipher, so factor hiring a translator into your planning and costs.

Finances and fees

A 20 per cent deposit is the norm for buying property in Germany, but some lenders require 40 per cent from expats as they are seen as a greater risk. A typical mortgage will be spread over a period of 25 or 30 years and feature fixed interest rates for the first five years.

Usually the buyer will be subject to a number of fees, which include:

·         A property transfer tax equal to 3.5 to five per cent of the property's value

·         The notary's fee, which is normally around 1.2 to 1.5 per cent

·         Registration charges of 0.8 to 1.2 per cent

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