Germany offers a legally secure and highly regulated framework for real estate transactions. While much attention is given to buying property, the process to sell real estate in Germany involves equally important legal and tax considerations. Whether you’re a foreign investor looking to liquidate assets, an expat relocating abroad, or a landlord divesting part of your portfolio, understanding how to sell property in Germany correctly is crucial.
This guide provides a comprehensive overview of the legal, administrative, and financial aspects of selling real estate in Germany. It explains the notarial procedure, key contractual clauses, tax implications (including capital gains), and best practices for a secure and smooth transaction.
Contents
- 1. Can Foreigners Sell Property in Germany?
- 2. Overview of the Legal Sale Process
- 3. Preparing to Sell Property: What You’ll Need
- 4. Finding a Buyer
- 5. Drafting and Signing the Sale Agreement
- 6. Taxes When You Sell Real Estate in Germany
- 7. Receiving Payment and Currency Transfer
- 8. Selling Property with an Existing Mortgage or Tenant
- 9. Timeline and Completion
- 10. Selling Real Estate from Abroad
- Conclusion
1. Can Foreigners Sell Property in Germany?
Yes. Foreign nationals can freely sell property in Germany, regardless of their residency or immigration status. Property owners may:
- Sell residential or commercial real estate
- Transfer full or partial ownership
- Appoint a legal representative through power of attorney
However, international sellers should pay particular attention to tax obligations, currency transfers, and notarial procedures, especially if selling from abroad.
2. Overview of the Legal Sale Process
The process to sell real estate in Germany follows a formal, legally binding structure:
Key Steps:
- Prepare property documents and find a buyer
- Agree on sale terms and appoint a notary
- Sign the notarised purchase agreement
- Complete payment and tax obligations
- Transfer ownership via the land register (Grundbuch)
All transactions must be notarised and entered into the Grundbuch for legal effect.
3. Preparing to Sell Property: What You’ll Need
Before listing your property, gather and prepare:
- Land register excerpt (Grundbuchauszug)
- Floor plans and energy certificate (Energieausweis)
- Rental contracts (if the property is let)
- Proof of identity and ownership
- Mortgage statements (if applicable)
- Consent from co-owners or spouses, if required
It is advisable to consult a legal or real estate professional to review any encumbrances or third-party rights before initiating the sale.
4. Finding a Buyer
You may sell property:
- Directly to a private buyer
- Through a real estate agent (Makler)
- Via auction or developer sales channels
Agent Commission
Real estate agents typically charge up to 3.57% (incl. VAT) of the sale price. This may be shared equally between buyer and seller, depending on federal state rules.
5. Drafting and Signing the Sale Agreement
Once terms are agreed, a German notary will:
- Draft the purchase contract (Kaufvertrag)
- Verify the property and ownership details
- Coordinate signatures and identity checks
- Oversee the legal and registration process
The contract typically includes:
- Property description and land register details
- Purchase price and payment deadlines
- Conditions precedent (e.g. financing, tenant agreement)
- Warranties and liability exclusions
- Handover date and use rights
📌 Note: In Germany, the notary is a neutral authority, not a representative of either party.
6. Taxes When You Sell Real Estate in Germany
One of the most important factors for international sellers is capital gains tax (Spekulationssteuer).
When is a sale tax-free?
- If the property was owned for at least 10 years, or
- If it was used exclusively for own residential purposes in the year of sale and the two preceding years
When is it taxed?
- If sold within 10 years of purchase
- If it was rented or used commercially
- If the seller is considered a “property trader” (multiple sales within short periods)
Other Taxes and Fees:
| Tax/Fee | Who Pays | Typical Rate |
|---|---|---|
| Real estate transfer tax | Buyer | 3.5% to 6.5% (by state) |
| Notary and land register fees | Typically buyer | ~1.5% to 2% total |
| Agent commission | Shared or buyer-only | Up to 3.57% (incl. VAT) |
| Capital gains tax (if applicable) | Seller | Personal income tax rate |
💡 Consult a tax advisor to review your capital gains exposure and optimize structuring—especially if you are a non-tax resident in Germany.
7. Receiving Payment and Currency Transfer
Typically, the purchase price is paid via escrow or direct transfer after all conditions of the contract are fulfilled:
- Priority notice in the land register is filed
- Tax clearance certificate is issued
- No remaining encumbrances exist (or are agreed upon)
Funds can be transferred to foreign bank accounts, but currency controls and reporting obligations under the Foreign Trade and Payments Regulation (AWV) may apply for large transactions.
8. Selling Property with an Existing Mortgage or Tenant
Mortgage:
If the property is encumbered with a loan, the mortgage must be:
- Paid off upon sale, or
- Transferred to the buyer with lender consent
The notary will coordinate with the bank to release the lien once payment is made.
Tenant:
German tenancy law (Mietrecht) provides strong tenant protections. Selling a rented property does not terminate the lease. The buyer becomes the new landlord (Kauf bricht nicht Miete). Eviction for personal use by the buyer may only occur under strict conditions.
9. Timeline and Completion
The entire sale process—from offer to ownership transfer—typically takes 8 to 12 weeks, depending on:
- Land registry processing times
- Bank and tax authority clearance
- Any agreed-upon conditions precedent
Once the sale is completed, the seller may be required to:
- Provide final utility meter readings
- Deliver keys and property documentation
- File a tax declaration for the sale year
10. Selling Real Estate from Abroad
Foreign sellers can sell German property remotely with:
- A power of attorney notarised and apostilled in their home country
- A representative in Germany (e.g., lawyer or agent)
- Remote communication with a German notary (with embassy or consular support, if needed)
This is common for international investors or expats who have left Germany but retained real estate assets.
Conclusion
To sell property in Germany successfully as a foreign national, it is crucial to understand the country’s legal formalities, tax implications, and administrative steps. While the process is formal and documentation-heavy, it offers transparency and strong legal protections for both seller and buyer.
By working with an experienced notary, tax advisor, and real estate professional, foreign owners can confidently navigate the German real estate market and ensure a compliant and profitable sale.
