Purchase costs in Germany: what comes on top

When you buy a flat or a house in Germany, the price is not all you pay. On top come the purchase costs (Kaufnebenkosten) – about 5.5 to 12.5% of the price, depending on the federal state and whether a broker is involved. On €400,000 that is easily €30,000 to €45,000, which banks don't like to lend.

The four items

1. Property transfer tax: 3.5 to 6.5%

The biggest item. Each federal state sets its own rate (Grunderwerbsteuer), so the same purchase costs much less in Bavaria than in Brandenburg or North Rhine-Westphalia.

The tax is charged on the purchase price. The tax office sends its notice a few weeks after the notary appointment, and you usually have a month to pay. Only then does it issue the clearance certificate (Unbedenklichkeitsbescheinigung) – without it you can't be entered in the land register.

What applies in your state, with examples: purchase costs in Bavaria, Berlin, North Rhine-Westphalia, and every state in the purchase costs calculator.

2. Notary: about 1.5%

In Germany a property purchase is only valid when a notary certifies it. The notary drafts the contract, reads it out at the appointment and handles the transfer. The fees are set by law and depend on the price, so there's nothing to negotiate. They usually include the land charge (Grundschuld) your bank asks for as security.

3. Land registry: about 0.5%

The local court enters you as the new owner, together with the bank's land charge. These fees are set by law as well.

4. Broker: often 3.57% – or nothing

Since December 2020, for flats and single-family houses, the buyer pays at most as much commission as the seller. The usual arrangement is a split, often 3.57% (3% plus VAT) for each side. If you buy without a broker – directly from the owner, or a new build from the developer – this item disappears.

An example

A flat for €400,000 in Bavaria, bought through a broker:

The same flat in North Rhine-Westphalia costs €12,000 more, from the higher transfer tax alone:

Why the purchase costs should come from your savings

Banks generally lend against the value of the property, not against the purchase costs. The money for tax, notary and broker is gone after the purchase – it isn't in the house. So many banks expect you to pay at least the purchase costs yourself. Borrowing more than the price usually means a noticeably higher interest rate.

Where you can save

Leave furnishings out of the taxed price. If you take over a fitted kitchen, furniture or an awning, no transfer tax is due on them – provided their price is stated separately in the purchase contract. The amount has to be realistic; the tax office can check it. You can enter it in the purchase costs calculator.

Buy without a broker. Searching yourself often saves more than €10,000.

Support for first-time buyers in Hesse. With the Hessengeld, people buying their first home to live in, in Hesse, get back up to €10,000 per buyer and €5,000 per child – paid in ten yearly instalments after moving in. So it doesn't help with the purchase itself.

In short

• Expect 5.5 to 12.5% of the price on top, depending on the state and the broker.
• The transfer tax makes the biggest difference: 3.5% in Bavaria, up to 6.5% in four states.
• Notary and land registry together cost about 2%, and can't be negotiated.
• Pay the purchase costs from your own money if you can.