Buying a property is one of the most important investments in life. However, in addition to the purchase price, there are also various additional costs that are often underestimated. To avoid unpleasant surprises and create a realistic financial plan, these costs should be factored in from the outset. In this blog post, you will find out what additional costs you will incur and how much they are likely to be.
Land transfer tax
The land transfer tax is one of the largest items of ancillary costs. This tax is a one-off charge on the purchase of a property and is calculated on the purchase price. The amount of land transfer tax varies depending on the federal state and is between 3.5% and 6.5% of the purchase price in Germany.
- Tip: Find out about the applicable tax rate in your federal state before you buy. There may be ways to reduce the tax, e.g. by purchasing part of the property.
Notary and land register fees
Every real estate purchase must be notarized, which involves notary fees. You also have to pay for the entry of the property in the land register. In total, the notary and land registry costs amount to around 1.5% to 2% of the purchase price.
- Why is this necessary? The notary ensures that the purchase contract is legally sound and ensures that the ownership rights are correctly entered in the land register.
- Allocation of costs: Notary fees and land registry fees are set by law and are therefore similar in all federal states.
Broker commission
In many cases, a property is purchased through an estate agent, which incurs additional costs in the form of an agent’s commission. This is usually between 3 % and 5 % of the purchase price. Since the reform of real estate agent law in 2020, the commission is usually split between the buyer and seller.
Expert costs
Especially when buying older properties, it is worth having the condition of the property checked by an expert in advance. Such an expert can tell you exactly what condition the building is in, whether there are any hidden defects and whether renovations are necessary. The cost of a surveyor is usually between 1,000 and 2,000 euros, depending on the scope and complexity of the survey.
- Why is it important? An independent surveyor protects you from making the wrong decisions and helps to avoid unforeseen expenditure on renovations.
- Tip: Choose a certified surveyor and have a detailed report drawn up. This can also be useful when negotiating prices.
Energy consulting
An energy consultation provides information about the energy status of a property. This can be particularly useful for older buildings in order to identify potential savings through modernization measures. The cost of an energy consultation is usually between 500 and 2,000 euros, depending on the scope of the analysis.
- What is checked? The energy consultant examines the thermal insulation, the heating system and other energy-related factors. He makes recommendations on how energy efficiency can be improved.
- Tip: In some cases, there are subsidy programs that cover all or part of the costs of an energy consultation. Find out about these options in advance.
Further possible additional costs
In addition to the main costs mentioned above, there are other, less obvious additional costs that you may incur:
- Financing costs: fees for arranging a loan, processing fees from the bank or costs for term life insurance.
- Building insurance: Building insurance is usually compulsory if the property is financed in order to protect it against damage.
- Modernization and renovation: Modernization is often necessary after the purchase in order to adapt the property to your own wishes.
An example
Suppose you want to buy a property for 500,000 euros in Bavaria. The estimated additional costs could be as follows:
- Land transfer tax (3.5%): 17,500 euros
- Notary and land registry fees (1.5%): 7,500 euros
- Broker commission (3.57% incl. VAT): 17,850 euros
- Surveyor costs: 1,500 euros
- Energy consultancy: 1,000 euros
- Total costs: 45,350 euros
Conclusion: Start your real estate purchase well informed
Buying a property is a complex matter that involves considerable additional costs. From land transfer tax and notary fees to estate agent commissions – all of these expenses should be taken into account when planning your finances. An early and careful calculation helps to avoid nasty surprises and ensures that you keep your budget under control.
Tip: If necessary, get professional support, be it from a real estate agent, financial advisor or surveyor. This will ensure that all relevant aspects are taken into account and that you are well prepared.