Authored by the expert who managed and guided the team behind the Germany Property Pack
Everything you need to know before buying real estate is included in our Germany Property Pack
Yes, normal people can absolutely buy property in Germany regardless of their nationality or residency status. Germany has one of the most open property markets in Europe, with no restrictions on foreign ownership and transparent purchasing processes that make real estate accessible to international buyers.
The German real estate market offers opportunities for both residents and non-residents, with clear legal frameworks and established financing options. While the upfront costs can be substantial, ranging from €200,000 to €500,000 for entry-level urban properties, the market provides security through strong property rights and stable legal systems.
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.
Foreigners can freely purchase property in Germany without residency requirements, with entry-level urban properties starting around €200,000-€300,000 and down payments typically ranging from 20-40% of the purchase price.
The total transaction costs including taxes, notary fees, and commissions add up to 8-15% of the property value, while mortgage rates currently average 3.5-4.5% for qualified buyers.
| Aspect | Requirements/Costs | Details |
|---|---|---|
| Foreign Ownership | No restrictions | Full ownership rights for all nationalities |
| Minimum Property Price | €200,000-€500,000 | Entry-level urban properties in major cities |
| Down Payment | 20-40% | Higher for non-residents (30-40%) |
| Mortgage Rates | 3.5-4.5% | Fixed rates as of September 2025 |
| Transaction Costs | 8-15% | Transfer tax, notary, agent fees |
| Property Tax | 0.26-1% | Annual tax on assessed value |
| Rental Yield | 3-5% | Gross yields vary by city |
Can foreigners actually buy property in Germany or do they need to be residents first?
Foreigners can freely buy property in Germany without any residency requirements whatsoever.
Germany maintains one of the most open property markets in Europe, with no nationality restrictions or residency prerequisites for property ownership. Both EU and non-EU citizens enjoy identical rights to German nationals when purchasing real estate.
The legal framework treats property ownership and residency as completely separate matters. You can own apartments, houses, or land in Germany while living anywhere in the world. This applies to all property types including freehold ownership, which grants full ownership rights indefinitely.
Importantly, purchasing property does not grant residency rights or visa privileges. If you plan to spend extended time in Germany, you'll still need appropriate visas or residence permits through the standard immigration channels.
It's something we develop in our Germany property pack.
What is the minimum amount of money needed to buy an apartment or small house in a German city right now?
The minimum realistic budget for urban property in Germany ranges from €200,000 to €300,000 as of September 2025.
Property prices vary dramatically by location, with national averages around €4,161 per square meter. In major cities, expect significantly higher costs: Munich averages €8,476/m², Berlin €5,451/m², while some eastern German cities remain under €2,000/m².
For small city apartments, budget €150,000-€350,000 in secondary cities. In major metropolitan areas like Berlin, Munich, or Hamburg, entry-level apartments or small townhouses typically start above €500,000. The absolute minimum properties in the cheapest rural areas might start around €80,000-€120,000, but these are often in locations with limited amenities or job opportunities.
These prices reflect purchase costs only. You'll need additional funds for down payments (20-40% of purchase price) plus closing costs (8-15% of purchase price) discussed in later sections.
Are there restrictions on the type of property foreigners can own, like land versus apartments?
There are zero restrictions on property types that foreigners can own in Germany.
Both EU and non-EU citizens can purchase any type of real estate including apartments, houses, commercial buildings, and vacant land. Freehold ownership (full ownership) is available for all property types, giving you complete control over your investment.
You can own multiple properties simultaneously with no legal limits on the number or value of properties in your portfolio. The ownership structure is identical to what German citizens enjoy, including rights to modify, rent out, or sell your properties.
This unrestricted access extends to all regions of Germany, from urban centers to rural areas, making it one of the most foreigner-friendly property markets in Europe.
How much cash do I need upfront for the down payment, and what percentage is typical in Germany?
Down payment requirements typically range from 20% to 40% of the purchase price, with higher percentages required for foreign buyers.
German banks generally expect 30-40% down payments from non-resident foreigners, while EU citizens residing in Germany may qualify for 10-20% down payments. The exact percentage depends on your residency status, income stability, and relationship with German financial institutions.
For a €250,000 property, budget €50,000-€100,000 as your down payment. This cash requirement doesn't include closing costs, which add another 8-15% to your total upfront investment.
Banks assess down payment requirements based on risk factors including your employment status, income source, existing German banking relationships, and overall creditworthiness. Establishing residency and local income sources typically improves your financing terms significantly.
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Can foreigners get a mortgage from a German bank, and if so, what are the conditions?
Foreigners can obtain mortgages from German banks, but conditions vary significantly based on residency status and nationality.
EU citizens residing in Germany receive treatment nearly identical to German nationals, with access to competitive rates and standard lending terms. Non-EU residents face stricter requirements but can still secure financing with proper documentation and income verification.
Non-resident foreigners encounter the most challenging conditions, typically requiring 30-40% down payments, proof of stable international income, and sometimes local guarantors. Banks prefer borrowers with established German banking relationships and verifiable income sources.
Required documentation typically includes proof of income, employment contracts, tax returns, credit history from your home country, and bank statements. Some lenders require German bank accounts for mortgage payments and property-related transactions.
It's something we develop in our Germany property pack.
What are the average interest rates on mortgages in Germany today?
Mortgage interest rates in Germany currently average 3.5% to 4.5% for fixed-rate loans as of September 2025.
The official average mortgage rate was 3.68% in June 2025, with rates varying based on loan terms, borrower profiles, and down payment amounts. Longer-term fixed rates (15-30 years) typically carry higher rates than shorter terms.
Foreign borrowers, particularly non-residents, often face rate premiums of 0.5-1.0% above standard rates due to perceived higher risk. Your final rate depends on creditworthiness, down payment size, income stability, and existing banking relationships in Germany.
These rates remain historically attractive compared to many international markets, though they've risen from the ultra-low levels seen in previous years. Rate locks are typically available for 6-12 months during the property search and purchase process.
What are the closing costs, taxes, and notary fees, and how much do they add up to in percentage terms?
Total closing costs range from 8% to 15% of the property purchase price, representing a significant additional expense beyond the property cost.
| Cost Type | Percentage Range | Details |
|---|---|---|
| Transfer Tax | 3.5% - 6.5% | Varies by state (Bavaria 3.5%, Berlin 6%) |
| Notary Fees | 1.0% - 1.5% | Legal documentation and verification |
| Land Registry | 0.2% - 0.5% | Official ownership registration |
| Agent Commission | 3% - 7% | Split between buyer/seller, not always required |
| Legal/Advisory | 0.5% - 1% | Optional but recommended for foreigners |
Transfer tax represents the largest single cost, with rates varying significantly by German state. Notary fees cover mandatory legal processes including contract verification and ownership registration. Agent commissions apply only when using real estate agents and are often split between buyer and seller.
Do I need to set up a German bank account before buying property?
A German bank account is required if you're obtaining a mortgage or want to streamline property-related transactions.
While technically possible to complete cash purchases through international transfers, German banks strongly prefer local accounts for mortgage payments, utility bills, property taxes, and maintenance expenses. Most mortgage lenders require German accounts for automatic payment processing.
Opening a German bank account is relatively straightforward for property buyers, though requirements vary by bank. You'll typically need passport identification, proof of income, and sometimes proof of German address (which can be your purchased property).
Even for cash buyers, local accounts simplify ongoing property management, tax payments, and potential future sales. The process typically takes 1-2 weeks once you provide required documentation.
Are there any special permits, visas, or residence requirements linked to owning property in Germany?
No special permits, visas, or residence requirements are linked to property ownership in Germany.
Property ownership and immigration status remain completely separate under German law. Buying property doesn't grant residency rights, and you don't need residency to own property. This means you can own German real estate while living anywhere in the world.
If you plan to spend significant time in Germany, you'll need appropriate visas through standard immigration channels - tourist visas for short stays, or residence permits for longer periods. Property ownership doesn't create any shortcuts or advantages in visa applications.
Germany doesn't offer "Golden Visa" programs linking property investment to residency, unlike some other European countries. Your property ownership status has no impact on visa requirements or immigration processes.
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.
What are the yearly property taxes and ongoing maintenance costs that I should expect?
Annual property taxes range from 0.26% to 1% of the assessed property value, typically lower than market prices.
Property tax (Grundsteuer) calculations use government-assessed values that often lag behind current market prices. For a Berlin apartment, expect annual property taxes around €80-€200, while higher-value properties in expensive areas may reach €500-€1,000 annually.
Ongoing maintenance costs vary by property type and age. Apartment owners pay homeowners association fees typically ranging €2-€5 per square meter monthly. Additional maintenance costs average 1-2% of property value yearly for older buildings, covering repairs, upgrades, and building improvements.
Insurance costs remain modest, while utility and energy bills depend on property size, efficiency, and local rates. Budget approximately €1,000-€3,000 annually for total ongoing costs on a typical urban apartment.
If I want to rent out the property, what are the rules, taxes, and typical rental yields in German cities?
No residency requirements exist for renting out German property, but all rental income is subject to German taxation.
Rental yields vary significantly by city as of September 2025:
- National average: 3-4% gross yield
- Berlin: 3.5-4.5% gross (net ~2.5-3.5%)
- Leipzig: Up to 5% gross yield
- Munich & Frankfurt: 2.3-3% gross yield
- Dresden and eastern cities: 4-5% gross yields
Net rental income faces German income tax rates up to 45% plus solidarity surcharge, though allowable expenses (mortgage interest, depreciation, management fees, repairs) can be deducted. Professional property management typically costs 8-12% of rental income.
Rent control regulations exist in many major cities, limiting annual rent increases and initial rental pricing. Short-term rental platforms like Airbnb face restrictions or licensing requirements in cities like Berlin.
It's something we develop in our Germany property pack.
How does selling a property in Germany work, and what capital gains taxes would I face if I sell within a few years?
Property sales follow standardized processes involving notaries and land registry, with capital gains tax depending on holding period and usage.
No capital gains tax applies if you hold property for at least 10 years, or if it served as your primary residence for at least 2 calendar years plus the year of sale. This makes Germany particularly attractive for long-term property investment.
Properties sold within 10 years face capital gains taxation at personal income tax rates (up to 45% plus solidarity surcharge) after a €1,000 annual exemption. The tax applies to the profit (sale price minus purchase price and improvement costs), not the total sale amount.
The sale process requires notary involvement for legal compliance and ownership transfer. Early mortgage repayment may involve penalties, depending on your loan terms. Professional legal advice is recommended for foreign sellers to optimize tax implications and ensure proper procedures.
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.
Germany offers one of Europe's most accessible property markets for international buyers, with transparent processes and secure ownership rights regardless of nationality or residency status.
While upfront costs are substantial - typically requiring €200,000+ for entry-level urban properties plus 8-15% in transaction costs - the market provides long-term stability and attractive tax benefits for properties held over 10 years.
Sources
- EasyFX - Buying Property in Germany as a Non-Resident
- InvestRopa - Germany Real Estate for Foreigners
- Lawyers Germany - Purchase Property Guide
- Global Property Guide - Germany Price History
- Expatica - Getting a Mortgage in Germany
- The Global Economy - Germany Mortgage Rates
- Immodo Berlin - Real Estate Tax Guide
- PTI Returns - Property and Rental Tax Germany