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Closing Costs (Nebenkosten / Kaufnebenkosten)

Additional costs when buying property

3 min readUpdated December 2024

Closing costs (Kaufnebenkosten) are the upfront fees required to complete a property purchase in Germany. They typically add 10-15% to your purchase price and must be paid in cash.

What's Included

Three Main Components:

1. Property Transfer Tax (Grunderwerbsteuer)

3.5% - 6.5% depending on state (largest component)

2. Notary & Land Registry (Notar + Grundbuch)

~2.0% for legal processing and ownership registration

3. Real Estate Agent (Makler)

3-7% if applicable (often split with seller, sometimes 0%)

Real Example: Total Closing Costs

€450,000 Property in Berlin (5% transfer tax):

  • Property transfer tax (5%):€22,500
  • Notary fees (1.5%):€6,750
  • Land registry (0.5%):€2,250
  • Agent commission (3.57% split):€16,065
  • Total closing costs:€47,565
  • As % of purchase price:10.6%

Must Be Paid in Cash

Cannot be financed

German banks will NOT finance closing costs—they only lend against the property value. This means for a €450k property with 10% down, you need:
• €45,000 down payment
• €47,565 closing costs
• Total cash: €92,565

Regional Variations

Transfer tax rates vary dramatically by state:

  • Bavaria: 3.5% (lowest) → €15,750 on €450k
  • Berlin: 6.0% → €27,000 on €450k
  • Schleswig-Holstein: 6.5% (highest) → €29,250 on €450k

Difference between Bavaria and Schleswig-Holstein: €13,500 on a €450k property!

Are Closing Costs Deductible?

Mostly no, with nuances:

  • Transfer tax & notary: Not deductible, but increase your cost basis (reduces capital gains if you sell before 10 years)
  • Agent commission: Can be immediately deductible as business expense (Werbungskosten) if the property is clearly for investment

Calculate exact closing costs for your purchase

Related Terms

Property Transfer Tax(Grunderwerbsteuer)

Grunderwerbsteuer is a one-time tax paid when purchasing property in Germany. The rate varies by state (Bundesland) from 3.5% to 6.5% of the purchase price.

Notary Fees(Notarkosten)

Notarkosten are mandatory fees paid to a notary (Notar) for authenticating property purchases in Germany. Typically 1.5-2% of purchase price, covering contract preparation and land registry updates.

Down Payment(Eigenkapital)

Eigenkapital (equity/down payment) is the cash you put down when purchasing property. German banks typically require 10-30% of purchase price plus closing costs (another 10-15%).