Arenja & Raj FinanzThe three components
Transfer tax by federal state
This is where geography costs real money. The same €400,000 flat carries €14,000 of transfer tax in Bavaria and €26,000 in North Rhine-Westphalia.
| Federal state | Property transfer tax |
|---|---|
| Bavaria | 3.5 % |
| Baden-Württemberg | 5.0 % |
| Lower Saxony | 5.0 % |
| Rhineland-Palatinate | 5.0 % |
| Saxony-Anhalt | 5.0 % |
| Thuringia | 5.0 % |
| Bremen | 5.5 % |
| Hamburg | 5.5 % |
| Saxony | 5.5 % |
| Berlin | 6.0 % |
| Hesse | 6.0 % |
| Mecklenburg-Western Pomerania | 6.0 % |
| Brandenburg | 6.5 % |
| North Rhine-Westphalia | 6.5 % |
| Saarland | 6.5 % |
| Schleswig-Holstein | 6.5 % |
Notary and land registry
German law requires a notary to authenticate a property sale — this is not optional and not a service you shop around for on price, because the fee scale is set by statute. Expect roughly 1.5 % of the price for the notary and around 0.5 % for entry in the land register, so about 2 % together.
The fee covers real work: drafting the contract, reading it aloud, arranging the priority notice that protects you between signing and payment, clearing the seller's existing mortgages and handling the registration.
Estate agent commission
Since December 2020 the seller cannot pass the whole commission to the buyer on a residential sale to a consumer; the parties share it. In practice this usually means 3.57 % including VAT for each side, though the total is negotiable and varies by region.
Buying directly from a private seller or a developer removes this item entirely — worth roughly €14,000 on a €400,000 flat.
Why banks will not finance them
A mortgage is secured on the property. Transfer tax, notary fees and commission leave no security behind — pay €34,000 in costs and the flat is not worth €34,000 more. So lenders treat these as the applicant's own contribution, and a file where the buyer cannot cover them is usually a file that does not proceed.
This is the single most common reason a purchase collapses for people who have saved diligently but budgeted against the price rather than the total.
What you can and cannot reduce
Transfer tax is fixed by your state, but the base is not always the full price. Moveable items sold with the property — a fitted kitchen, a garden shed, furniture — can be listed separately in the contract at a realistic value and are not subject to transfer tax. Tax offices scrutinise inflated figures, so the amount has to be defensible.
Agent commission disappears on private and developer sales. Notary fees do not move. And on a new build sold as land plus a construction contract, the tax may apply only to the land portion in some structures — a question for your notary and tax adviser, not a general rule.
A worked example: a €400,000 flat
The same flat, the same buyer, three different outcomes depending only on where it stands and whether an agent is involved.
| Scenario | Purchase costs | Total outlay |
|---|---|---|
| Bavaria, private sale | €22,000 (5.5 %) | €422,000 |
| Hamburg, private sale | €30,000 (7.5 %) | €430,000 |
| Hamburg, with agent | €44,280 (11.07 %) | €444,280 |
| North Rhine-Westphalia, with agent | €48,280 (12.07 %) | €448,280 |
The gap between the cheapest and the most expensive line is €26,280 — for an identical flat. It is the largest single lever most buyers never think to pull, and it is decided before you look at a single listing.
Costs people forget entirely
Budget calculator
Run your own numbers
The calculator below takes the purchase costs off before it shows you a price — most affordability calculators quietly do not.
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How much are Kaufnebenkosten in total?
Between roughly 7.5 % and 15 % of the purchase price. The low end is Bavaria without an estate agent — 3.5 % transfer tax plus about 2 % notary and registry. The high end is a state with 6.5 % transfer tax plus an agent, which reaches about 12 %, and a little more where commission is higher than average.
Can I add the purchase costs to my mortgage?
Only within so-called 110 % financing, which a small number of lenders offer to applicants with very strong, secure incomes. It costs a noticeably higher interest rate and is not available to most buyers. The realistic plan is to have the costs in cash.
Which state has the lowest transfer tax?
Bavaria, at 3.5 %. The highest rate is 6.5 %, applying in Brandenburg, North Rhine-Westphalia, Saarland and Schleswig-Holstein. The rate that counts is the one where the property sits, not where you live.
When do I have to pay them?
Notary fees arrive shortly after the appointment. The transfer tax assessment usually follows within a few weeks of signing and is payable about a month later. Agent commission falls due on completion of the contract. In practice the whole sum leaves your account within roughly two to three months of the notary appointment.
Are purchase costs tax deductible?
Not for a home you live in yourself. For a let property they are capitalised with the building and written off through annual depreciation — spread over decades rather than deducted at once. That difference is one reason the arithmetic on an investment property looks nothing like the arithmetic on a home.