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Everything you need to know before buying real estate is included in our Germany Property Pack
Buying property in Germany requires substantial upfront capital beyond just the purchase price.
German banks typically demand a 20% deposit from residents, but foreign buyers and expats often face requirements of 30-40% or more. Additional costs including property transfer tax, notary fees, and agent commissions can add another 7-12% of the property value to your total upfront expenses.
If you want to go deeper, you can check our pack of documents related to the real estate market in Germany, based on reliable facts and data, not opinions or rumors.
German property deposits range from 20% for residents to 40% for foreign investors, with additional upfront costs of 7-12% of purchase price.
Self-employed buyers and non-EU citizens face stricter requirements, while investment properties typically require 30-40% deposits regardless of buyer profile.
| Buyer Type | Typical Deposit % | Additional Costs % | Total Upfront % |
|---|---|---|---|
| German Resident | 20% | 7-12% | 27-32% |
| EU Expat | 20-25% | 7-12% | 27-37% |
| Non-EU Foreign Buyer | 30-40% | 7-12% | 37-52% |
| Self-Employed | 30-40% | 7-12% | 37-52% |
| Investment Property | 30-40% | 7-12% | 37-52% |
| Best Case Scenario | 10-15% | 7-12% | 17-27% |
| Worst Case Scenario | 40%+ | 7-12% | 47-52%+ |
How much deposit do I actually need to buy a property in Germany?
The minimum deposit for buying property in Germany depends heavily on your residency status and income stability.
German residents with stable employment typically need a 20% deposit, while foreign buyers and expats often face requirements of 30-40% of the purchase price. Non-EU citizens without German residency are at the higher end of this range.
Self-employed buyers, regardless of nationality, usually need deposits of 30-40% due to perceived income instability. Banks view variable income as higher risk, requiring larger upfront payments to offset this concern.
The absolute minimum deposit recorded is 10-15%, but this applies only to exceptional cases involving German residents with excellent credit scores, permanent employment contracts, and long-established banking relationships.
As of September 2025, these requirements have remained consistent across major German banks.
What percentage of the purchase price do banks in Germany typically expect as a deposit?
German banks standard deposit expectation is 20% of the property purchase price for domestic buyers.
This 20% benchmark applies to German nationals and permanent residents with stable, documented income from German employers. Banks consider this group the lowest risk category.
Foreign buyers face significantly higher requirements, with banks typically demanding 30-40% deposits depending on their specific circumstances. Non-EU buyers without established German credit history are often required to provide deposits at the upper end of this range.
Investment property purchases trigger higher deposit requirements regardless of buyer nationality, with banks typically expecting 30-40% as standard practice. This reflects the additional risks associated with rental income projections and property management.
It's something we develop in our Germany property pack.
Are there minimum deposit requirements that vary depending on whether I'm a resident, expat, or foreign investor?
Yes, deposit requirements vary significantly based on your residency status and nationality when buying German property.
| Buyer Category | Minimum Deposit | Typical Range | Key Requirements |
|---|---|---|---|
| German Resident | 15% | 20-25% | Permanent employment, good credit history |
| EU Expat with German Job | 20% | 20-30% | Local employment contract, residency permit |
| EU Expat without German Job | 25% | 30-35% | Proof of foreign income, assets documentation |
| Non-EU Foreign Buyer | 30% | 35-40% | Extensive documentation, higher scrutiny |
| Foreign Investor (Non-resident) | 35% | 40-50% | Investment purpose, no local income |
| Self-Employed (Any Status) | 30% | 35-45% | 3 years business accounts, tax returns |
| Corporate Purchase | 40% | 40-60% | Company financials, personal guarantees |
How much more deposit is usually required if I want a lower monthly mortgage payment?
Increasing your deposit from 20% to 30% typically reduces monthly mortgage payments by 15-20% and improves interest rates by 0.2-0.5 percentage points.
A 40% deposit can lower monthly payments by 25-30% compared to a 20% deposit, while also qualifying you for the best available interest rates. German banks offer progressively better terms as the loan-to-value ratio decreases.
For a €500,000 property, increasing your deposit from €100,000 (20%) to €200,000 (40%) would reduce monthly payments from approximately €1,800 to €1,350, saving €450 monthly. The exact savings depend on current interest rates and loan terms.
Banks also become more flexible with other loan terms when deposits exceed 30%, including reduced documentation requirements and faster approval processes.
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What's the difference in deposit requirements between buying an apartment in Berlin versus a house in Munich?
Deposit requirements are primarily based on buyer profile rather than property location, so Berlin apartments and Munich houses follow similar percentage rules.
The main difference lies in absolute amounts due to significant price variations between cities. Munich properties typically cost 40-60% more than equivalent properties in Berlin, meaning larger absolute deposits despite similar percentages.
For a €400,000 Berlin apartment requiring a 25% deposit, you'd need €100,000 upfront. A comparable Munich property costing €600,000 with the same 25% requirement would need €150,000 - a €50,000 difference in absolute terms.
Some banks may apply slightly higher deposits (2-5% more) for properties in high-demand Munich neighborhoods due to market volatility concerns, but this is not standard practice across all lenders.
Property type matters more than location - houses typically require marginally higher deposits than apartments due to higher maintenance risks and market liquidity concerns.
How does the property price range, say €200,000 versus €800,000, change the deposit amount I'll need?
Property price ranges primarily affect absolute deposit amounts rather than percentage requirements, though luxury properties may face additional scrutiny.
For a €200,000 property with a 25% deposit requirement, you'd need €50,000 upfront. An €800,000 property with the same percentage would require €200,000 - four times the absolute amount but the same relative percentage.
Properties above €750,000 may trigger enhanced due diligence from banks, potentially requiring additional documentation about income sources and financial stability. Some lenders increase deposit requirements by 5-10% for properties exceeding €1 million.
Higher-value properties often receive more favorable interest rates due to lower loan-to-value ratios and the assumption of financially stable buyers. Banks view expensive property purchases as lower default risk despite larger absolute amounts.
It's something we develop in our Germany property pack.
Do German banks accept smaller deposits if I have a very stable income or high credit score?
German banks may reduce deposit requirements for borrowers with exceptional financial profiles, but this flexibility is limited and rarely applies to foreign buyers.
German residents with permanent employment contracts, excellent credit scores (Schufa score above 95%), and high income (5+ times annual mortgage payments) may qualify for deposits as low as 10-15%. This represents less than 5% of all mortgage applications.
High-earning expats with long-term German employment contracts might negotiate deposits of 15-20% instead of the standard 25-30%, but this requires established German credit history and typically minimum annual income of €150,000.
Foreign buyers without German residency rarely receive deposit reductions regardless of income or foreign credit scores, as German banks cannot easily verify foreign credit histories or income stability.
Public sector employees, medical professionals, and lawyers often receive more favorable treatment due to income stability perceptions, potentially reducing deposits by 2-5 percentage points.
If I'm self-employed, how much deposit would banks expect compared to someone with a fixed salary?
Self-employed buyers typically face deposit requirements 10-15 percentage points higher than salaried employees, regardless of income levels.
1. **Standard self-employed deposits**: 30-40% compared to 20-25% for employees 2. **Documentation requirements**: 3 years of business accounts, tax returns, and profit/loss statements 3. **Income verification**: Banks calculate average income over 3 years, often discounting recent high earnings 4. **Industry considerations**: Stable professions (doctors, lawyers, architects) receive better treatment than variable income businesses 5. **Additional security**: Some banks require business assets as additional collateral beyond the property depositFreelancers and consultants face the strictest requirements, often needing 35-45% deposits due to income volatility concerns. Established business owners with consistent 3+ year track records may negotiate deposits closer to 25-30%.
Banks view self-employed income as inherently riskier, even when annual earnings exceed those of salaried workers. This perception drives higher deposit requirements regardless of actual financial stability.
We did some research and made this infographic to help you quickly compare rental yields of the major cities in Germany versus those in neighboring countries. It provides a clear view of how this country positions itself as a real estate investment destination, which might interest you if you're planning to invest there.
Are there any extra upfront costs in Germany, like notary fees, property transfer tax or agent fees, that I need to budget on top of the deposit?
Yes, German property purchases involve substantial additional costs beyond the deposit, typically adding 7-12% of the purchase price to your upfront expenses.
| Cost Type | Percentage of Purchase Price | Example on €500,000 Property | When Paid |
|---|---|---|---|
| Property Transfer Tax (Grunderwerbsteuer) | 3.5% - 6.5% | €17,500 - €32,500 | Within 2 weeks of contract |
| Notary Fees | 1.5% - 2.0% | €7,500 - €10,000 | At contract signing |
| Land Registry Fees | 0.5% | €2,500 | After notarization |
| Real Estate Agent Commission | 3.5% - 7.0% | €17,500 - €35,000 | At purchase completion |
| Property Valuation | 0.1% - 0.2% | €500 - €1,000 | During mortgage application |
| Legal/Translation Fees | 0.2% - 0.5% | €1,000 - €2,500 | Various stages |
| Building Survey (Optional) | 0.1% - 0.3% | €500 - €1,500 | Before contract signing |
Property transfer tax varies by federal state, with Bavaria and Saxony at 3.5% and North Rhine-Westphalia at 6.5%. This tax cannot be financed and must be paid in cash.
Agent commissions are often split 50/50 between buyer and seller, but this varies by region and negotiation. In some areas, buyers pay the full commission.
Can I use gifted money or savings from abroad as part of the deposit in Germany?
German banks accept gifted money and foreign savings for property deposits, but require extensive documentation to verify legal sources and comply with anti-money laundering regulations.
Gifted money must be accompanied by a formal gift declaration, proof of the donor's income sources, and bank statements showing the funds' origin. Gifts from immediate family members receive more straightforward acceptance than those from distant relatives or friends.
Foreign savings require comprehensive documentation including bank statements from origin countries, currency exchange records, and proof of legal income sources abroad. Large transfers may trigger additional scrutiny from German financial authorities.
Banks typically require gifted funds to be in your German account for 3-6 months before property purchase to demonstrate stability and legitimate ownership. Last-minute gifts or transfers often create delays in mortgage approval.
It's something we develop in our Germany property pack.
How much deposit do I need if I plan to buy the property as a rental investment instead of living in it myself?
Investment property purchases require significantly higher deposits than owner-occupied properties, typically 30-40% regardless of buyer profile.
Banks view rental properties as higher risk due to vacancy concerns, tenant management challenges, and potential rental income fluctuations. This risk assessment drives uniformly higher deposit requirements across all lenders.
Non-resident foreign investors often face deposit requirements of 40-50% for investment properties, combining foreign buyer premiums with investment property risks. Some banks require up to 60% for non-EU buyers purchasing rental properties.
Banks may consider projected rental income when calculating mortgage eligibility, but typically apply conservative estimates (70-80% of market rent) to account for vacancy periods and maintenance costs.
Investment properties also trigger stricter documentation requirements including rental market analysis, property management plans, and additional financial reserves beyond the deposit amount.
What's the lowest realistic deposit someone has managed to buy a property with in Germany recently?
The absolute lowest deposits achieved in recent German property purchases range from 5-10%, but these cases are extremely rare and limited to specific circumstances.
1. **5-7% deposits**: Available only to German civil servants with permanent contracts, doctors with hospital positions, or lawyers with established practices 2. **8-10% deposits**: Possible for German residents with exceptional credit scores (95+), high income (€200,000+), and existing substantial banking relationships 3. **10-15% deposits**: More achievable for German residents with excellent financial profiles, representing about 2-3% of all mortgage applications 4. **Standard minimums**: 20% for residents, 30% for foreign buyers remain the realistic baseline for most purchasers 5. **Special programs**: Some regional development banks offer reduced deposits for first-time buyers in specific areas, typically 15-18%These ultra-low deposit mortgages often come with higher interest rates, stricter terms, and mandatory mortgage insurance that can cost 0.5-1.5% annually. The total cost may exceed traditional higher-deposit mortgages over the loan lifetime.
Foreign buyers achieving deposits below 25% are virtually unheard of in the current market, with banks maintaining strict risk assessment criteria regardless of income levels or assets.
Conclusion
This article is for informational purposes only and should not be considered financial advice. Readers are advised to consult with a qualified professional before making any investment decisions. We do not assume any liability for actions taken based on the information provided.
Understanding deposit requirements is crucial for successful German property investment, as undercapitalization remains the primary reason for failed property purchases.
Foreign buyers should budget for deposits of 30-40% plus additional costs of 7-12%, meaning total upfront capital requirements of 37-52% of property value for realistic purchase planning.
Sources
- PTI Returns - Buying Property in Germany as a Foreigner
- Global Property Guide - Germany Buying Guide
- Welcome Center Germany - Buying Property as a Foreigner
- Visit World Today - Buying House in Germany for Expats
- Expatica - Getting a Mortgage in Germany
- Gurcan Partners - Buying Property in Germany
- Azury One - Additional Costs When Buying Real Estate
- KPMG - Tax Tips for Real Estate Buyers