Plots
Development
sale of properties
Planning to sell your property? The process can be complex. We show you how to increase value, consider legal aspects, and complete successfully. Need personalised advice? Get in contact here with our experts.
A comprehensive due diligence before the sale is crucial to minimise risks and achieve the best possible sale price.
The choice of the right sales strategy (agent, municipality, developer) significantly affects the time on the market and the costs. A strategic plan can increase the sale price by up to 5%.
A realistic cost calculation, including property transfer tax, notary fees, and broker commission, is essential to avoid financial surprises and ensure the profitability of the sale.
Purchasing Land as a Strategic Decision
The purchase of land represents a fundamental decision for builders and investors. It goes far beyond merely acquiring land; it is an investment in the future that offers both financial and creative freedoms. Owning your own land means having control over the entire construction process and the opportunity to create a bespoke home or a profitable venture. Therefore, the decision to purchase land should be well-considered and take into account the buyer's long-term goals.
Importance of Land Purchase for Builders and Investors
For builders, purchasing land provides the unique opportunity to design a house according to personal preferences. Unlike buying an existing property, you can incorporate your individual needs and wishes from the very beginning. Investors view the purchase of land as a long-term asset that can pay off through development or later resale. The strategic location and potential for development are crucial factors in this regard. Our analysis on land value appreciation offers further insights.
Overview of the German Land Market
The German land market is dynamic and diverse, characterized by regional differences and current trends. Land prices and availability vary greatly depending on location, size, and attributes. Therefore, it is essential to gain a comprehensive overview of the market before making a purchase decision. Understanding the current developments and particularities helps you assess opportunities and risks more effectively and find the right piece of land.
Current Trends and Developments
Currently, we observe a trend towards denser construction in urban areas to meet the growing demand for housing. At the same time, there is an increasing demand for land in rural areas as many people seek peace and nature. The topic of sustainability is also gaining importance, both in the choice of land and in subsequent development. The integration of building land into existing structures is another important aspect. Land prices have continuously risen in recent years, especially in metropolitan areas. This makes careful planning and financing all the more important.
Regional Differences and Specifics
Land prices and availability vary considerably between different federal states and regions. In metropolises like Munich or Hamburg, prices are significantly higher than in rural areas. Building regulations and funding programs also vary from region to region. Therefore, it is advisable to inform yourself about the specific local conditions before purchasing. The development of new residential areas is often managed by the municipalities, which also affects availability and prices.
Acquiring the right plot of land is a crucial step when selling plots. There are various strategies you can follow, each with its own pros and cons. The choice of the right strategy depends on your individual needs, your budget and your goals. Whether you choose to work with an estate agent, contact municipalities directly, or purchase through a developer – careful consideration is essential. The immowelt property search offers initial guidance on this.
Engaging Estate Agents: Pros and Cons
Working with an estate agent can significantly ease the purchase of a plot. Agents have an extensive network and knowledge of the local market. They can present suitable plots, organise viewings, and assist you in negotiations. However, using an agent comes with costs in the form of a commission. Therefore, it's important to carefully weigh the services and costs.
Comparison of Commissions and Services
In Germany, the agent's commission typically ranges between 3.57% and 7.14% of the purchase price. This commission is due when the purchase contract is concluded. In return, the agent offers a range of services, such as the mediation of suitable properties, organisation of viewings, support during negotiations, and preparation of the purchase contract. It is advisable to compare the services and costs of different agents to find the best offer. The amount of the agent's commission should be transparent and comprehensible.
Critical Evaluation of Agent Services (3.57% - 7.14%)
Although agents can provide valuable support, it is important to critically evaluate their services. Not every agent is equally good, and not every service is worth the price. Pay attention to the agent's experience and expertise, their knowledge of the local market, and their ability to represent your interests. Question the offers presented and, if necessary, seek a second opinion. A critical examination of agent services helps you make an informed decision and avoid unnecessary costs. The real estate market can be complex, so professional support is often sensible.
Direct Contact with Municipalities
Another way to acquire a plot is direct contact with municipalities. Many municipalities sell plots independently, without involving agents. This can save you significant costs, as no agent commission is incurred. Furthermore, you have the opportunity to speak directly with decision-makers and get a comprehensive picture of the development prospects of the plot.
Cost Benefits through Transparent Allocation Processes
The allocation processes of municipalities are generally transparent and comprehensible. The plots are often publicly tendered, and the criteria for allocation are clearly defined. This creates equal opportunities and allows you to fairly apply for the plot. Furthermore, the costs for the agent's commission are eliminated, which can make the purchase of plots considerably cheaper. The direct contact persons in the municipality can provide you with information about the development status.
Prioritising Direct Inquiries with the Municipality
It is advisable to prioritise direct inquiries with the municipality, especially if you have a limited budget. Find out about current construction areas and the allocation conditions. Contact the responsible staff and ask your questions. Good preparation and a convincing application can increase your chances of success. The municipality can also provide you with information on the development plan.
Plot Acquisition via Developers
Acquiring a plot via a developer is another option, particularly interesting for builders who want to construct a turnkey house. Developers often offer complete packages that include both the purchase of plots and the construction of houses. This can save you a lot of time and effort as you don't have to coordinate the individual trades yourself.
Building Obligation and Its Implications
When acquiring a plot through a developer, a building obligation is typically included. This means you commit to building a house on the plot within a certain period. This can limit your flexibility, as you are tied to the developer and their building plans. Therefore, it is important to carefully examine the building obligation and its implications before deciding on the purchase.
Weighing Availability against Building Developer Commitment
Acquisition via a developer can give you access to plots that might otherwise be unavailable. However, you should critically weigh the commitment to the developer and their building plans. Make sure the building plans match your expectations and that you are satisfied with the developer’s services and prices. Independent advice can help you better assess the pros and cons of acquiring through a developer.
Before the sale of properties, comprehensive due diligence is essential to identify and avoid potential risks and issues early on. This thorough examination covers various aspects, from reviewing the development plan and analyzing the land register to investigating the development status and soil condition. A thorough due diligence protects you from unexpected costs and legal issues and ensures you make an informed purchase decision.
Review of the Development Plan
The development plan is an important document that regulates how a property can be developed. It contains specifications regarding the permissible use, construction method, building height, and setback areas. Before purchasing a property, you should carefully review the development plan to ensure that your construction plans align with the specifications. Otherwise, you risk having your building permit rejected or needing to make costly changes to your plans.
Restrictions on Roof Shape, Floors, Minimum Distances, Building Size, and Location
The development plan may contain a variety of restrictions that limit your design freedom. For example, it may stipulate the roof shape, number of floors, minimum distances to neighboring properties, maximum building size, and the location of the building on the property. It's important to know these restrictions precisely before you start planning your house. Compliance with the development plan is crucial for the feasibility of your building project.
Avoiding Costly Changes Through Early Examination
An early review of the development plan can save you a lot of trouble and costs. If you find that your construction plans do not align with the specifications, you can adjust your plans in time or refrain from purchasing. Subsequent changes to the plans are often associated with significant costs and delays. Therefore, it is advisable to review the development plan before signing the purchase contract.
Analysis of the Land Register
The land register is a public record that provides information about the ownership and encumbrances of a property. Before buying a property, you should carefully analyze the land register to ensure that the seller is indeed the owner, and the property is not burdened with mortgages, land charges, or other encumbrances. Encumbrances in the land register can limit your rights as an owner and lead to financial risks. Our article on understanding the land register offers detailed information about this.
Identification of Mortgage Liens and Encumbrances
The land register lists all mortgages, land charges, and other encumbrances that affect the property. These encumbrances can limit your rights as an owner and lead to financial risks. For example, a mortgage may prevent you from selling or encumbering the property without the creditor's consent. Therefore, it is important to identify all encumbrances in the land register and examine their impact on your rights and obligations. Knowing the land register is essential for a secure property purchase.
Uncovering Potential Restrictions
In addition to mortgages and land charges, other restrictions such as rights of way, usufruct rights, or pre-emption rights may also be recorded in the land register. These rights can limit your use of the property and lead to conflicts with third parties. Therefore, it is important to identify all restrictions in the land register and examine their impact on your plans. A thorough analysis of the land register helps you identify and avoid potential problems early on.
Development Status: Developed vs. Undeveloped
The development status of a property indicates whether it is connected to the public supply network. A developed property has connections to sewage, electricity, water supply, and telephone networks. An undeveloped property does not have these connections. The development status significantly affects construction costs, as the costs for development must be borne by the purchaser for an undeveloped property.
Significance of Development Status for Construction Costs
The development status is a crucial factor for construction costs. For an undeveloped property, you must bear the costs for connecting to sewage, electricity, water supply, and telephone networks yourself. These costs can be significant, depending on the location and condition of the property, and may amount to tens of thousands of euros. It's important to check the development status before purchasing and include the development costs in your calculation. The immowelt property search often provides initial hints about the development status.
High Connection Costs for Sewage, Electricity, Water, and Telephone for Undeveloped Properties
The connection costs for sewage, electricity, water, and telephone can be very high for an undeveloped property. The exact cost depends on various factors such as the distance to the nearest connection, soil condition, and local conditions. It is advisable to obtain a quote from the relevant utility companies before purchasing, to determine the exact costs. Our article on development costs provides further information.
Geotechnical Report: Assessing Soil Conditions
A geotechnical report, also known as a soil report, provides information about the soil conditions on the property. It examines the load-bearing capacity of the soil, groundwater conditions, and the presence of contaminants. A geotechnical report is especially important if you want to build a house with a basement or if the property is located in a risk area, such as on a slope or near a body of water.
Assessment of Soil Conditions, Especially for Basement Construction (£1,000 - £1,500)
A geotechnical report usually costs between £1,000 and £1,500. However, this investment can be worthwhile, as the report provides you with important information about the soil conditions and helps you avoid structural damage and unnecessary costs. Especially when building a basement, it is important to know the load-bearing capacity of the soil and groundwater conditions to ensure a safe and durable construction. The costs for a geotechnical report should be considered in the budget.
Identifying Risks Such as Slopes or High Groundwater Levels
A geotechnical report can identify risks such as slopes or high groundwater levels. Slopes can lead to landslides and settlements, while high groundwater levels can make sealing the basement difficult. If the report reveals such risks, you must take appropriate measures to minimize them, such as building a retaining wall or sealing the basement. The results of the geotechnical report are crucial for planning.
Investigation of Contaminated Sites: Considering Environmental Aspects
Contaminated sites are soil or groundwater contaminations resulting from previous industrial or commercial uses. Contaminated sites can pose a significant risk to health and the environment and lead to high remediation costs. Before purchasing a property, you should therefore check whether the property is contaminated. This is particularly important if the property was previously used for industrial or commercial purposes.
Checking Former Commercial or Industrial Properties for Contaminated Sites (Chemicals, Oil)
Former commercial or industrial properties are particularly often contaminated. The contamination may have been caused by chemicals, oil, or other pollutants released during the previous use of the property. It is important to identify and remove these contaminated sites before developing the property. Otherwise, you risk health damage and high remediation costs. Identifying contaminated sites is an important step in property purchase.
Consultation of the Contaminated Sites Register or Commissioning a Soil Report
To determine whether a property is contaminated, you can consult the contaminated sites register of the relevant authority or commission a soil report. The contaminated sites register contains information about known contaminated sites. A soil report examines the soil and groundwater for pollutants. If the report finds contaminated sites, you must inform the relevant authority and have a remediation plan created. The polluter of the contaminated sites generally bears the remediation costs. Consulting the contaminated sites register is an important step to minimize risks.
When selling properties, a realistic and comprehensive cost calculation is essential to avoid financial surprises. In addition to the purchase price itself, there are numerous other costs you should definitely consider. These include the property transfer tax, notary fees, land registry fees, and possibly the estate agent's commission. Careful planning and budgeting will help you assess the financial burden of buying a property correctly and achieve your financial goals.
Property Transfer Tax: Consider Regional Differences
The property transfer tax is a tax incurred when acquiring a property. The amount of property transfer tax varies depending on the federal state and ranges between 3.5% and 6.5% of the purchase price. It is important to include the property transfer tax in your cost calculation, as it can make up a significant part of the total costs. Find out about the current tax rate in your state to determine the exact amount of property transfer tax.
Consideration of Property Transfer Tax (3.5% - 6.5% of the purchase price) Depending on State
The property transfer tax is a significant cost factor when buying a property. It is levied on the purchase price of the property and varies depending on the federal state. For example, it's 3.5% in Bavaria, while in other states it can be up to 6.5%. Therefore, it is important to know the exact tax rate in your state and include it in your cost calculation. The amount of the property transfer tax significantly affects the total costs.
Notary Fees and Land Registry Charges
Notary fees and land registry charges are incurred for certifying the sales contract and entering the change of ownership in the land registry. The amount of these costs is legally regulated and depends on the purchase price of the property. As a rule, you can expect about 1.5% of the purchase price for notary fees and land registry charges.
Budgeting Approx. 1.5% of the Purchase Price for Notary Fees and Land Registry
Notary fees and land registry charges are fixed components of the cost calculation when buying a property. They include the costs for the notary's certification of the sales contract and the fees for entering the change of ownership in the land registry. As a rule, you can expect about 1.5% of the purchase price for these costs. It is advisable to plan this amount into your budget to avoid financial surprises. The exact costs can be obtained from the notary.
Agent's Commission: Plan for Additional Costs
If you use an estate agent when buying a property, an agent's commission usually applies. The amount of the agent's commission is freely negotiable but typically ranges between 3.57% and 7.14% of the purchase price. It is important to include the agent's commission in your cost calculation, as it can make up a significant part of the total costs.
Consideration of Agent's Commission (3.57% - 7.14% of the Purchase Price) When Using an Agent
The agent's commission is a variable cost factor when buying a property. It is due if you hire an agent to broker the property and the purchase contract is completed through their intermediation. The amount of the commission is freely negotiable but typically ranges between 3.57% and 7.14% of the purchase price. It is important to agree on the agent's commission in advance with the agent and include it in your cost calculation. While using an agent may incur additional costs, it can also save time and effort.
The leasehold represents an intriguing alternative to the traditional purchase of land, especially for buyers with a limited budget or those who appreciate flexibility. With a leasehold, you do not acquire the land itself but merely the right to construct and use a building on it. For this right, you pay a regular ground rent to the landowner. The leasehold offers financial advantages, but it also involves a long-term commitment.
Financial Advantages and Disadvantages of Leasehold
The greatest advantage of leasehold is the lower initial costs. Since you do not purchase the land but only acquire the usage right, you save a substantial portion of the purchase price. However, you pay an annual ground rent, usually between 4% and 6% of the land value. It's important to carefully weigh the financial pros and cons of leasehold to determine if it's the right option for you.
Lower Initial Costs but Annual Ground Rent (4-6% of Land Value)
The leasehold allows you to build a house without having to buy the land. This significantly reduces the initial costs since you only acquire the right to develop the land. In return, you pay an annual ground rent to the landowner, typically between 4% and 6% of the land value. It is important to factor this ground rent into your long-term financial planning. The long-term commitment is a crucial aspect of leasehold.
Long-Term Commitment to the Leaseholder
The leasehold is generally associated with a long-term commitment to the leaseholder. The duration of the leasehold is often several decades, usually 99 years. During this time, you are bound to the leaseholder and must regularly pay the ground rent. It is important to be aware of this long-term commitment before deciding on a leasehold.
Balancing Costs and Owner Status
Another important aspect of leasehold is the lack of land ownership. Since you do not purchase the land but only acquire the usage right, you are not the landowner. This can limit your freedom to decide, for example, if you wish to sell or encumber the land. Therefore, it is vital to carefully weigh the advantages and disadvantages of the lack of land ownership.
Pros and Cons of Lack of Ownership
The lack of land ownership is a significant difference from the traditional purchase of land. While you have the right to develop and use the land, you are not the owner. This can restrict your freedom to decide, for instance, if you wish to sell or encumber the land. On the other hand, you also have fewer responsibilities, such as maintaining the land. It is important to carefully evaluate the pros and cons of not owning the land to determine if the leasehold is the right option for you.
When selling property, it may occur that there is an existing structure on the land, such as an old house or a factory. In this case, you need to decide whether to demolish the existing structure or integrate it into your new building plans. Both options have their advantages and disadvantages, which you should carefully consider. The decision depends on various factors, such as the condition of the existing structure, the costs for demolition or renovation, and your individual preferences.
Demolition Costs: Budgeting and Planning
If you decide to demolish the existing structure, you must include the demolition costs in your cost calculation. The amount of demolition costs depends on various factors, such as the size and construction type of the building, the materials used, and local conditions. You can generally expect demolition costs of several thousand euros. It is advisable to obtain quotes from various demolition companies before proceeding, to determine the exact costs.
Considering Demolition Costs for Old Buildings
Demolition costs are a significant cost factor when buying property if there is an existing structure on the land. The amount of these costs depends on the size, condition, and construction type of the old building. The disposal of demolition materials can also incur additional costs. Therefore, it is advisable to obtain a demolition quote before purchase to know the exact costs. The immowelt property search can provide initial hints about existing structures.
Potential Costs Depending on Size and Materials
The potential demolition costs can vary depending on the size and materials of the existing structure. A small wooden house can usually be demolished more cheaply than a large brick building. The disposal of hazardous waste, such as asbestos, can also significantly increase costs. It is therefore important to thoroughly assess the existing structure before purchase and realistically estimate the potential demolition costs.
Possibilities for Individual Use
If you decide against demolition, there are several ways to individually use the existing structure. You can renovate and modernize the building to use it as living or commercial space. Alternatively, you can integrate parts of the building into your new construction plans, such as by using them as a garage or storage space. The individual use of the existing structure can save you costs and add unique charm to your new build.
Using the Property as a Spacious Garden
Even if the existing structure is no longer habitable, you can use the land as a spacious garden. You can redesign and plant the garden to create a green oasis. This can be particularly appealing if you are building a house with a small garden or if you love nature. Using the land as a garden can provide relaxation and recreation. Utilizing it as a spacious garden can add value.
The purchase of land is a complex decision that requires careful planning and preparation. There are many aspects to consider, from choosing the right acquisition strategy to conducting comprehensive due diligence and realistic cost estimation. By paying attention to these aspects and seeking professional advice, you can successfully navigate the purchase of land, build your dream home, or make a profitable investment.
Summary of the key aspects when purchasing land
The key aspects of purchasing land can be summarized as follows:
Choosing the right acquisition strategy: Real estate agent, local government, or developer?
Conducting comprehensive due diligence: Development plan, land register, development status, soil condition, contamination
Realistic cost calculation: Purchase price, property transfer tax, notary fees, land register fees, agent commission, demolition costs
Examination of alternative financing models: Leasehold
Professional advice: Architect, civil engineer, lawyer, tax advisor
Careful planning and preparation is the key to success.
Outlook on future developments in the land market
The land market will continue to evolve in the future. Prices are expected to keep rising, especially in metropolitan areas. Sustainability will also play an increasingly important role, both in the choice of land and in its development. Therefore, it is important to address future developments early on and prepare accordingly.
State subsidies for energy-efficient construction offer an excellent opportunity to invest in a sustainable and future-proof property. Whether it's a new build or the renovation of an old building, the available funding programs and tax benefits make building or buying an energy-efficient house attractive and financially feasible.
With a variety of funding programs and tax incentives, there are numerous ways to reduce the costs of building or buying an energy-efficient house. Auctoa offers you comprehensive advice and support in selecting the right plot of land, meeting technical requirements, navigating the application process, and avoiding potential issues.
By choosing an energy-efficient house, you're investing in the future of your home. You will not only reduce your energy costs and secure a high quality of living, but also make a significant contribution to environmental protection.
Now is the perfect time to explore the funding opportunities for your project. Contact us today to start your individual consultation and submit the funding application quickly and easily. Register for free and instantly receive an initial estimate of the refurbishment needs of your property.
Summary of Key Aspects
Strategic planning, thorough due diligence, and precise cost estimation are crucial for a successful land purchase. You should gather comprehensive information before the purchase and seek expert advice if necessary. The right preparation is the key to success.
Checklist for Land Purchase
Here is a checklist that can help you with your land purchase:
Check the development plan: What restrictions are there?
Analyse the land register: Are there any mortgages or encumbrances?
Verify the development status: Is the land developed?
Prepare a geotechnical report: What is the soil condition?
Conduct a contamination survey: Are there any pollutants?
The correct application of the land register can help you minimize financial risks.
Outlook on the Future of the Land Market
The land market will continue to evolve in the future. Sustainability and digitalisation will play an increasingly significant role. You should inform yourself about the current trends and developments to accurately assess the opportunities and risks for buyers and sellers. The appreciation of land is highly dependent on the future development of the market.
The sale of properties can be a lucrative opportunity to unlock capital and achieve financial goals. Whether it is undeveloped land, a building plot, or a property with existing structures, the right strategy and preparation are crucial for a successful sale.
With a professional property valuation, careful planning, and effective marketing, you can achieve the best possible price for your property and optimise the sales process. Avoid common mistakes and rely on expert tips to circumvent pitfalls and ensure a smooth sale.
Seize the opportunity now to successfully sell your property and achieve your financial goals. Contact us today to start a personalised consultation and optimise the sales process. Register for free and instantly receive an initial estimate of your property's value.
Now is the perfect time to explore the possibilities for your project. Contact us today to start your individual consultation and handle the sale of your property quickly and easily. Register for free and instantly receive an initial estimate of your property's value. Contact us!
Wikipedia offers detailed information on real estate transfer tax in Germany, including regional differences and legal foundations.
Bundesverband der Deutschen Ziegelindustrie provides information on important aspects of property purchase and building law, especially for builders.
What strategies are there for optimally selling a property?
There are various strategies, including collaborating with an experienced estate agent, directly contacting local authorities, or selling through a developer. Each strategy has its advantages and disadvantages, which should be carefully considered.
What risks does selling a property entail, and how can they be minimised?
Risks include unexpected environmental liabilities, legal issues in the land register, or restrictions due to the development plan. Comprehensive due diligence before the sale can minimise these risks.
What costs are incurred when selling a property?
In addition to the purchase price, costs for property transfer tax, notary, land register, and possibly an estate agent's commission are incurred. A realistic cost calculation is essential.
What is a leasehold, and what are its pros and cons when selling a property?
The leasehold is an alternative to traditional purchase, where only the right to develop is acquired. It offers lower acquisition costs but also involves a long-term commitment and no ownership of the land.
How important is the development plan when selling a property?
The development plan regulates the type and manner of development and includes provisions on the permissible use, construction method, and building height. A careful review is crucial to avoid costly changes.
What should be considered when examining the land register?
The land register provides information about the ownership status and encumbrances of the property. It is important to identify mortgage encumbrances, land charges, and other restrictions.
What does the development status mean, and how does it affect the sale price?
The development status indicates whether the property is connected to the public supply network. An undeveloped property incurs high connection costs and reduces the sale price.
How should existing structures on the property be dealt with?
There is the option to demolish the existing structures or integrate them into new construction plans. The decision depends on the condition of the existing structures, costs, and individual preferences.
