Real estate

Examples on this page are simplified illustrations, not financing or tax advice. Rates and prices change – we calculate your real numbers with you.

Can expats buy property in Germany?

Yes. Germany has no restrictions on foreigners buying homes or investment property – whether you are from the EU, the USA, India or Taiwan, and whether you live in Germany or abroad. You become the registered owner in the land register (Grundbuch) exactly like a German buyer.

What differs is how easily you get a mortgage. German banks finance expats regularly, but they look more closely at a few points.

What banks need from expats

Requirement	What banks usually expect
Residence permit	Permanent residence (Niederlassungserlaubnis) or EU citizenship is easiest. With an EU Blue Card or a limited permit, many banks still lend – often with more equity.
Job	Permanent contract, probation period completed, ideally some months in your current job
Equity	At least the purchase costs; for non-permanent residents often 10–20% of the price on top
Credit history	A SCHUFA record in Germany – new arrivals have a short history, which banks know
Documents	Passport and residence permit, employment contract, last 3 payslips, bank statements, proof of equity, property documents
Language	The notary contract is in German; for non-German speakers an interpreter must be present at the signing

How buying works – step by step

1. Check your budget and financing. Equity, income and the rate you can afford – ideally with a written financing confirmation from the bank.
2. Find and inspect the property. For flats, ask for the minutes of the owners’ meetings (Protokolle), the economic plan (Wirtschaftsplan) and the level of the maintenance reserve.
3. Make an offer and reserve. A reservation is common but not legally binding.
4. Get the loan approved. The bank values the property and issues the loan agreement.
5. Notary contract. The notary sends you the draft – as a private buyer you get at least two weeks to review it. You sign at the notary, with an interpreter if needed.
6. Priority notice and transfer tax. The notary registers a priority notice (Auflassungsvormerkung) to secure your claim; the tax office sends the real estate transfer tax bill.
7. Payment and handover. Once the notary confirms that all conditions are met, you pay the price and receive the keys.
8. Land register. After the transfer tax is paid, you are entered as the new owner – usually a few weeks to months later.

Purchase costs by federal state

On top of the price you pay real estate transfer tax (Grunderwerbsteuer), notary and land registry fees (about 2%) and – if an agent is involved – usually 3.57% agent’s commission as the buyer. Banks rarely finance these costs, so they normally come from your equity.

Federal state	Transfer tax	Total costs with agent
Bavaria	3.5%	about 9.1%
Baden-Württemberg, Lower Saxony, Rhineland-Palatinate, Saxony-Anhalt, Thuringia	5.0%	about 10.6%
Bremen, Hamburg, Saxony	5.5%	about 11.1%
Berlin, Hesse, Mecklenburg-Western Pomerania	6.0%	about 11.6%
Brandenburg, North Rhine-Westphalia, Saarland, Schleswig-Holstein	6.5%	about 12.1%

Everyday example

Mei, 33, works at a semiconductor company in Dresden and buys a two-bedroom flat for €350,000 through an agent. Her purchase costs: €19,250 transfer tax, about €7,000 for notary and land register and €12,495 agent’s fee – about €38,750 before she has paid a single euro of the price.

Running costs: what owners pay

As an owner you pay costs that a tenant never sees. Plan for them before you compare your loan payment with your rent.

Cost	What it is	Typical amount
House money (Hausgeld)	Monthly payment to the owners’ association for a flat: building insurance, caretaker, cleaning, administration, maintenance reserve	often €3–5 per m² a month
Maintenance reserve	Part of the Hausgeld for repairs to the building; for a house you save it yourself	about €1–2 per m² a month
Repairs inside your flat	Kitchen, bathroom, floors, windows – your own responsibility	plan €1 per m² a month
Property tax (Grundsteuer)	Annual municipal tax	often a few hundred euros a year
Insurance	Building insurance for a house; household contents and liability for everyone	from about €150 a year

For a 70 m² flat, that quickly adds up to €250–€400 a month on top of your loan payment – part of the Hausgeld (such as cleaning or caretaker) can be passed on to a tenant if you rent it out, the rest cannot.

Property calculator: costs, financing and break-even

Enter the price, your federal state and your equity. The calculator shows your purchase costs and monthly payment – and when buying pays off: compared with renting if you live in it, or compared with the money you put in if you rent it out (including tax).

Buy or rent?

Buying is not automatically better than renting. At today’s interest rates, an owner often pays more each month than a tenant – the advantage comes from paying off the loan and from rising property values over many years. Whether and when buying wins depends mainly on four things:

• Price-to-rent ratio: the higher the price compared with the rent, the longer it takes.
• Interest rate and repayment: every 0.5% more interest delays the break-even noticeably.
• How long you stay: purchase costs of around 10% need years to earn back – buying for 3–5 years rarely pays off.
• What a tenant would do with the money: if they invest the difference consistently, renting stays competitive for a long time.

Property as an investment

If you rent the property out, the tax situation changes: rental income is taxed at your personal rate, but you can deduct interest, running costs that you cannot pass on and the depreciation of the building (AfA) – usually 2% a year, 2.5% for buildings from before 1925 and 3% for new buildings completed from 2023. Land cannot be depreciated.

Everyday example

Mei buys a second flat for €350,000 with €90,000 equity and rents it out for €1,100 cold a month. In the first year, after loan payment and costs, she adds about €730 a month from her own pocket – but because interest and depreciation create a tax loss, her tax bill falls by about €250 a month at a 35% tax rate. Her real monthly contribution: around €480. After 10 years, she could sell tax-free; in the calculator, the investment breaks even after about 7 years at 2% annual value growth.

What happens if you leave Germany?

• Your own home: if you lived in it yourself in the year of sale and the two years before, the sale is tax-free – even within 10 years.
• Renting it out from abroad: possible, but you need a property manager, a German bank account and you remain liable for German tax on the rental income.
• Selling a rental within 10 years: the gain is taxed at your personal rate; after 10 years it is tax-free.
• Your loan: the contract continues when you move – but early repayment within the fixed-rate period can cost a prepayment penalty, unless you sell after 10 years.

Insurance around your purchase

• Building insurance – required by the bank for a house; for flats included in the Hausgeld.
• Term life insurance – secures your family and the loan if you die. More on essential insurance.
• Occupational disability insurance – your loan payment continues even if you cannot work.
• Landlord liability – if you rent out a flat; often included in personal liability, check the terms.

Buying property in Germany as an expat – how we help

We are licensed mortgage brokers (§ 34i GewO) and know what banks need from expats. We compare offers, prepare your documents, explain the notary contract in English and secure your purchase with the right insurance – all from one contact.

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Frequently asked questions

Can foreigners buy property in Germany?

Yes. There are no restrictions for foreign buyers – you can buy a home or an investment property in Germany regardless of your nationality or where you live.

Can I get a mortgage in Germany with a Blue Card or a limited residence permit?

Often yes. Many banks finance holders of an EU Blue Card or a limited permit if the job is permanent and the probation period is over – usually with more equity than for permanent residents. A broker knows which banks accept which permits.

How much equity do I need to buy property in Germany?

At least enough to cover the purchase costs of about 7–12% of the price. Expats without permanent residence should plan for another 10–20% of the price. More equity usually means a lower interest rate.

What are the purchase costs in Saxony?

Real estate transfer tax is 5.5% in Saxony. With notary and land registry fees of about 2% and an agent’s fee of 3.57%, you pay about 11% on top of the price.

Is buying better than renting in Germany?

It depends on the price-to-rent ratio, the interest rate and how long you stay. Our calculator shows when buying pays off in your case – often only after 10–20 years for owner-occupiers at current rates.