Planning to purchase a property and wondering about the actual additional costs? Notary fees are a significant, yet often underestimated factor, which can increase your total investment by up to 2%. We'll show you how the fees are composed and where you can avoid costly mistakes.
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The topic briefly and concisely
The notary and land registry costs amount to approximately 1.5% to 2.0% of the purchase price of the property and are legally stipulated in the GNotKG.
Typically, the buyer bears the majority of the notary costs; the seller only pays for the removal of their own encumbrances from the land register.
The greatest leverage for cost optimisation is the separate purchase of land and property in new build projects, as the fees are based on the lower land value.
The purchase of a property is one of the largest financial decisions you will make. While the purchase price is the main focus, the small print hides the additional purchasing costs. In particular, the notary fees for the property purchase are legally prescribed and unavoidable. An error in calculation can blow your budget by thousands of euros. This article provides you with a precise breakdown of the cost structure according to the Court and Notary Fees Act (GNotKG), shows you the exact calculation using examples, and provides strategic levers to help optimize your financial burden. This way, you can turn uncertainty into a clear, data-driven decision.
The Legal Basis: Why Notary Fees Are Non-Negotiable
Every property purchase in Germany requires mandatory notarisation to be legally valid. This statutory requirement from § 311b BGB protects both buyers and sellers alike. The amount of fees incurred is not arbitrary but is precisely regulated by the Court and Notary Costs Act (GNotKG). This means that all notaries in Germany must charge the same fees for the same services. Negotiating notary fees is therefore legally excluded and any attempt would be futile. The fee structure is based on the transaction value, which is typically aligned with the purchase price of the property. This fixed cost structure ensures transparency and prevents price competition among notaries, which could jeopardise the quality of advice. Having a precise understanding of these fixed cost blocks is the first step towards solid financial planning.
Cost Breakdown: How the fees are composed
The total costs, often generally referred to as "notary costs," comprise two main elements: the notary fees and the land registry fees. As a rule of thumb, you can expect total costs of about 1.5% to 2.0% of the property purchase price. Of this, approximately 1.0% accounts for the notary fees alone, and a further 0.5% covers the land registry office fees for the transfer of ownership. A notary does more than just read out the contract. The fees cover a wide range of services necessary for secure processing. These include, among others:
Drafting and notarisation of the sales contract
Obtaining necessary approvals, e.g., a manager's consent
Securing the buyer by registering a priority notice
Monitoring the payment of the purchase price
Removing the seller's encumbrances from the land register
The final transfer of ownership in the land register
Each of these steps incurs specific fees, which add up to a total amount. A detailed calculation of the property costs is therefore essential. The complexity of these steps explains why professional handling is crucial.
Example calculation: Notary fees for a property worth €350,000
To make the abstract percentages tangible, let's consider a concrete example. Suppose you purchase a property for a purchase price of €350,000. The notary and land registry costs would approximately consist of the following:
Certification of the purchase contract (double fee): approx. €1,370
Execution and management fees (each half fee): approx. €685
Land registry costs for priority notice of conveyance & registration: approx. €685
Additional expenses (postage, copies): approx. €50
In total, the pure notary and land registry costs amount to about €2,790. Added to this is the statutory VAT of 19% on the notary service (not on the land registry fees), amounting to around €400 in this case. Your total costs amount to approximately €3,190, which is just under 0.9% of the purchase price. If a land charge for financing is also registered, additional fees apply. A precise overview of notary matters helps to identify such items early. These figures illustrate how important it is to make a precise preliminary calculation to avoid exceeding the budget.
The role of the buyer: Who bears the cost burden?
Although both contracting parties are liable to the notary for the costs, the practice in Germany is clear. In 99% of cases, the purchase contract stipulates that the buyer bears the majority of the notary and land registry costs. There is a practical reason for this: if the seller were to cover these costs, they would very likely add them to the purchase price. This, in turn, would increase the buyer's basis for calculating the land transfer tax, thereby increasing the overall burden. The seller typically only covers a small portion of the costs. These include the fees for the removal of encumbrances that are still registered in their name in the land registry, such as an old mortgage. These costs often amount to only a few hundred euros. The clear separation of costs in property sales ensures a fair distribution. As a buyer, you should firmly plan for these costs as part of your acquisition incidental expenses.
Optimization Strategies: Where Costs Can Be Legally Reduced
Even though notary fees themselves are non-negotiable, there are legal ways to optimise costs. The biggest lever lies in structuring the purchasing process, particularly in new construction projects. A proven approach is the separate acquisition of land and construction services. If you first buy only the undeveloped land, the notary fees of around 1.5% are only payable on the (lower) land price. Conclude the construction contract in a second, independent step. With a land value of €150,000 and construction costs of €300,000, you save over €4,500 in notary and land registry fees. Another point is forgoing a notary escrow account. Directly transferring the purchase price to the seller is standard and saves the additional trustee fees of the notary, which can quickly amount to 0.25% to 0.5% of the purchase sum. A thorough examination of the contractual terms is crucial here.
Conclusion: Precise planning as the key to success
Notary fees when purchasing land are a transparent but not insignificant cost factor, amounting to up to 2% of the purchase price. Their amount is stipulated by the GNotKG and directly depends on the certified value. A precise understanding of the composition and strategic decisions, such as the separate acquisition of land and property, offer legal optimisation opportunities. However, the most important factor for a correct cost calculation is a realistic and market-appropriate property value. An inaccurate estimate can lead to unexpected additional payments. Unsure about the true value of your desired plot? ImmoGPT chat from Auctoa provides you with an initial, data-driven assessment in just 60 seconds. A well-founded valuation is your best protection against unpleasant financial surprises.
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Additional useful links
Wikipedia provides a comprehensive overview of notary fees in Germany.
The Federal Chamber of Notaries offers a fee calculator to determine notary costs.
On gesetze-im-internet.de, you can find the full text of the Court and Notary Fees Act (GNotKG).
The Federal Ministry of Finance provides detailed information about real estate transfer tax.
The Bundesanzeiger is the official platform for legal and business announcements in Germany.
FAQ
What is the difference between notary fees and land registry fees?
Notary fees are the charges for the services provided by the notary, such as contract certification and consultation. Land registry fees are charges imposed by the state land registry office for the registration of rights, such as transfer of ownership or a land charge. The notary often invoices you for both items and forwards the land registry fees.
When are the notary fees due?
The notary's invoice is usually due a few weeks after the notarisation date. Payment is a prerequisite for further processing, such as the transfer of ownership in the land register.
Why is a notary required when purchasing property?
The legislature mandates notarisation to protect both parties from hasty decisions and to ensure legal certainty. The notary acts as an impartial advisor, informs about risks, and ensures a clean and legally correct transfer of ownership.
What happens if the buyer does not pay the notary fees?
If the buyer does not pay, the notary can also demand the payment from the seller, as both are jointly and severally liable. Additionally, the notary will halt the processing of the purchase contract, meaning the buyer will not be registered as the new owner in the land register until the invoice is settled.
Are there still notary fees if the purchase falls through?
Yes, if the notary has already provided services, such as drafting a purchase agreement, fees may still apply even if the contract is ultimately not notarised. The amount depends on the extent of the services already rendered.
How can an accurate property valuation affect notary fees?
The notary fees are based on the purchase price. A professional, data-driven property valuation from Auctoa ensures that you pay a fair price. This prevents the notary fees from being based on an inflated purchase price and provides you with a solid foundation for your overall financial planning.
