Additional purchase costs in Berlin

The four items at a glance

Additional purchase costs are not small print. They decide whether the bank says yes or no. In Berlin, there are four items. The affordability calculator works out which purchase price suits your income once the additional costs have been deducted.

The percentages for notary and land register are based on experience. They are calculated under the Court and Notary Fees Act. The more expensive the property, the smaller the share.

Real estate transfer tax: the biggest chunk

Berlin has charged six per cent real estate transfer tax (Grunderwerbsteuer) since 2014. That puts the city in the upper range of the federal states. It is calculated on what you pay for the property, so normally on the purchase price in the contract.

Many people overlook a legitimate trick. No real estate transfer tax is due on items that are not permanently part of the building. If the fitted kitchen is listed in the purchase contract as a separate item at €12,000, you save €720 in tax.

Two conditions apply: the prices must be realistic, and the items must genuinely be removable. If you overdo it, the tax office will notice. And the bank deducts the amount from what it is prepared to lend against.

The tax assessment arrives a few weeks after the notary appointment. Only once you have paid does the tax office send its clearance certificate (Unbedenklichkeitsbescheinigung), confirming that nothing is outstanding for tax purposes. Without this document, the land registry will not register you as the owner.

Notary and land register

There is no way round the notary. Under § 311b BGB (German Civil Code), a purchase contract for a property must be signed before a notary, otherwise it is not valid. What the notary costs is set out in the Court and Notary Fees Act. It is the same everywhere. Haggling is pointless.

The notary charges for several steps. The appointment itself. The priority notice of conveyance (Auflassungsvormerkung), the placeholder in the land register (Grundbuch) that secures the property for you. The processing afterwards. And the period during which the notary holds your money in escrow. These costs are normally paid by the buyer. The seller pays for having old loans deleted from the land register.

The land registry charges for three entries: the placeholder, the transfer into your name and, if you take out a loan, the bank's land charge. How this works step by step is explained in the article on the notary appointment and land register.

Agent's commission under the equal split principle

Since 23 December 2020, one rule applies when single-family houses and owner-occupied flats are sold to private buyers: if the seller engaged the agent, or the agent works for both sides, the buyer pays no more commission than the seller, so never more than half. The rules are set out in §§ 656a to 656d BGB (German Civil Code).

In Berlin the commission is therefore usually 7.14 per cent including VAT, split into two halves of 3.57 per cent each. Important for you as a buyer: you only pay once the seller has shown that they have paid their share. More in the guide Estate agent commission in Berlin.

This does not apply to every property. The rule does not cover the purchase of a multi-family building, a plot or a commercial property. There, the client and the agent set the commission in the agency agreement. The amount is stated in the brochure.

A worked example

Let's assume you buy an owner-occupied flat in Berlin for €500,000 through an agent.

Example, rounded. What the notary and land registry cost in your case depends on the circumstances, above all on whether a land charge is registered for the bank.

That is around 11.4% on top. Banks do not normally lend you this money. You therefore need the €56,850 in addition to the equity the bank wants to see for the purchase price.

What buyers often forget

• Costs after the purchase. Moving, a kitchen, renovation and possibly a new heating system are not in the purchase contract, but you still have to pay for them.
• The reserve for repairs. With a freehold flat, the maintenance reserve belongs to the owners' association, not to the seller. On purchase you become a member of this association; the reserve is not part of the purchase price. Check how much it holds and what the owners decided most recently.
• Special levies already resolved. If the owners have resolved to replace the roof, this can quickly run to five figures. The purchase contract should state who pays. Otherwise you will argue about it later.
• Property tax (Grundsteuer). From the handover, it continues in your name. Since the reform, the amount is often different from before.

Sources

• § 11 Real Estate Transfer Tax Act (Grunderwerbsteuergesetz) in conjunction with Berlin state law (tax rate of six per cent since 2014)
• §§ 656a to 656d German Civil Code (BGB), agency agreements for flats and detached houses
• § 311b paragraph 1 BGB (German Civil Code), notarisation of property purchase contracts
• Court and Notary Costs Act (GNotKG), schedule of costs