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Comprehensive legal information for real estate heirs: Learn all important aspects of inheritance law, tax law, and contracts to make informed decisions. Auctoa supports you with AI-based analyses and expert knowledge.
Inheritance Law Basics Explained
Tax Aspects in Focus
Confidently navigate contract law
The Essentials of Inheritance Law for Real Estate: A Guide for Heirs
Understanding Statutory Inheritance
Review will and inheritance contract
Understanding Compulsory Share Claims in Real Estate
Managing a Community of Heirs and Property
The community of heirs: Rights, duties and typical conflicts in real estate assets
An heir community is created by law when several people become heirs together, such as to a property. This coming together of co-heirs brings specific rights and obligations for each individual and requires the joint management of the estate. Decisions about the property, such as a sale, rental, extensive renovations, or taking out a mortgage, must generally be made unanimously by all co-heirs. In practice, this can lead to complex and lengthy decision-making processes, especially if the interests of the co-heirs diverge. Each co-heir basically has the right to demand the use of the property within the framework of shared usage, provided this does not unreasonably impair the rights of the other co-heirs. At the same time, all co-heirs are jointly liable for liabilities related to the property. These include, for example, property tax, incurred repair costs, or interest and principal payments on existing loans. Typical points of conflict within an heir community are different ideas about the future use or exploitation of the property: One heir wants to sell quickly to obtain the proceeds, another prefers long-term rental to generate income, and a third might consider personal use. The settlement of the heir community, meaning its dissolution and the distribution of the net estate, can be carried out through an informal partition agreement (for movable items) or a notarised agreement (for immovable items). Alternatively, the sale of the property and the subsequent division of the proceeds is possible. If no agreement can be reached, often the only last resort is partition by auction, a judicial procedure for the forced sale of the property. Early, open communication, transparent information for all involved parties, and, if necessary, the involvement of a neutral mediator or a lawyer experienced in inheritance law are crucial to avoid lengthy and costly disputes. Auctoa supports heir communities with neutral, data-driven property valuations and concrete strategic recommendations to create a fair and informed basis for decision-making for all co-heirs. Keywords: heir community property, co-heir rights obligations, property management heir community, property sale heir community, settlement heir community, partition auction property.
Legal Aspects in Focus
Your legal questions regarding the property
Inheritance Law Compact
Basics, will, compulsory portion: Your guide through inheritance law for real estate.
Tax law
Inheritance tax, property tax: Optimise your tax situation with expert knowledge.
Contract law
Purchase agreement, rental agreement: Understand important clauses and legally compliant drafting.
Tenancy law
Rights and duties as a landlord and heir of a rented property.
Property Law
Land register, encumbrances, easements: What you need to know about your property.
Divorce law
Property in Divorce: Finding Equitable Gains, Usage Rights, and Fair Solutions.
Estate Agency Law
Contracts, commission, obligations: Safely navigate property sales with a real estate agent.
Building Law
Building permit, development plan: Legal framework for construction projects.
Neighbour law
Boundary distances, building encroachment, emissions: Avoid and resolve conflicts with neighbours.
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Will and Inheritance Contract: How to Legally Arrange Your Real Estate Inheritance
To modify the statutory order of succession, which occurs when no disposition is made upon death, according to one's own wishes and particularly to manage the estate of real property strategically, the testator has the will and the inheritance contract available as central instruments. A will can either be handwritten by the testator, dated and signed as a holographic will, or established as a public will through notarial certification. It must clearly and unequivocally express the testator's intentions. An inheritance contract, on the other hand, is a bilateral legal transaction concluded between the testator and at least one other party (e.g. the heir) and necessarily requires notarial certification. Unlike a will, which can be revoked or changed unilaterally at any time, the inheritance contract has a higher binding effect on the testator. Both forms of disposition enable the appointment of heirs, the allocation of certain assets as a legacy (e.g. a usufructuary right or a residential right in a property), the ordering of estate administration, or issuing instructions to the heirs. For property owners, it is particularly important to make precise and legally watertight arrangements. This serves to minimise potential disputes among the heirs and ensure the continuation or orderly disposal of the property in accordance with the testator’s wishes. The so-called "Berlin will", in which spouses or registered partners appoint each other as sole heirs and the joint children inherit as final heirs only after the death of the surviving partner, is a frequently chosen design to secure the surviving partner. Given the complexity of inheritance law and the far-reaching financial consequences, particularly for real estate assets, professional legal advice from a notary or a specialist lawyer in inheritance law is essential. Only in this way can the solution that fits the individual situation be found, tax aspects optimised, and formal errors avoided, which could lead to the invalidity of the disposition. Keywords: property will, inheritance contract real estate assets, estate regulation property, notarial will, holographic will, Berlin will real estate, legal advice inheritance law.
The compulsory portion in inheritance law: What property owners and heirs need to know
German inheritance law guarantees close relatives a minimum share of the estate even in the event of disinheritance through a will or inheritance contract – the so-called compulsory portion. Those entitled to a compulsory portion are descendants of the deceased (children, grandchildren, great-grandchildren), the surviving spouse or registered partner, and, if no descendants exist, the deceased's parents. Siblings are not entitled to a compulsory portion. The compulsory portion amounts to half the value of the statutory share of the inheritance. If one or more properties are part of the estate, determining their correct market value at the time of the inheritance is crucial for calculating the compulsory portion. The person entitled to the compulsory share has a pure monetary claim against the heirs or the community of heirs; they do not become co-owners of the property(ies). Valuing the property for calculating the compulsory share is often a point of contention and frequently requires an independent appraisal of market value. Gifts made by the deceased during their lifetime may under certain circumstances trigger a supplementary compulsory share claim. This means they are hypothetically added to the estate in the calculation of the compulsory portion if they were made within the last ten years before the inheritance (reduction model: each year before the inheritance, the attributable value reduces by 10%). Different, longer deadlines may apply to gifts to the spouse. The compulsory share claim must be asserted by the entitled party against the heirs and generally becomes time-barred within three years. The period begins at the end of the year in which the entitled party became aware of the inheritance and the disposition affecting them (e.g. disinheritance in the will). Keywords: compulsory portion property inheritance, compulsory share claim amount, calculate compulsory portion property value, disinheritance secure compulsory portion, gift supplementary compulsory share, limitation period compulsory share.
Inheritance tax on real estate: allowances, tax classes and optimisation strategies
Acquiring property through inheritance or gift is subject to inheritance or gift tax in Germany. The amount of this tax depends on several factors: the value of the property acquired and the degree of kinship between the deceased/giver and the acquirer. The Inheritance Tax and Gift Tax Act (ErbStG) distinguishes between three tax classes, each with different tax rates and personal allowances. Spouses and registered civil partners (tax class I) benefit from the highest personal allowance of 500,000 euros and an additional maintenance allowance. Children and stepchildren (also tax class I) have an allowance of 400,000 euros per parent. Grandchildren receive 200,000 euros, provided their parent (the deceased's child) is still alive, otherwise 400,000 euros. For tax valuation of properties, the tax office determines the so-called 'need value' using standardized methods (e.g., comparable, income, or asset valuation methods), which may differ from the actual market value. A significant tax exemption exists for owner-occupied family homes: if the spouse/partner inherits the family home and continues to live in it for at least ten years, it remains tax-free. For inheriting children, this exemption applies if the living area does not exceed 200 square meters and they also live in it for ten years. Legal optimization strategies include lifetime gifts to reuse allowances every ten years, granting usufruct or residence rights that reduce the value of the gift, or choosing the appropriate matrimonial property regime for spouses (e.g., separation of property to avoid claims for equalization of accrued gains that would reduce the estate). Early, strategic estate planning with the involvement of a tax advisor or specialist lawyer in inheritance law is essential to legally minimize the tax burden. The Auctoa Inheritance Tax Calculator can provide an initial indication of potential tax liability. Keywords: Inheritance tax property allowance, tax class inheritance tax, property valuation inheritance tax tax office, family home inheritance tax exemption, optimize property gift tax, property need value.
The property in the event of divorce: equalization of gains, usage rights, and utilization
In the event of a divorce, joint property often represents a central and emotionally charged issue in property settlement disputes, especially in the context of equalisation of gains. If the property belongs to both spouses jointly, for example as half co-ownership, an agreement must be reached on what should happen to it. The most common options are: the sale of the property and subsequent division of the sale proceeds; one spouse taking over the property with a payout to the other (often associated with taking over existing loans); or granting sole ownership to one spouse as part of the overall property settlement. However, if the property belongs solely to one spouse, it is still subject to the equalisation of gains, provided the spouses lived under the legal matrimonial property regime of community of accrued gains, which is usually the case if no marriage contract was signed. The increase in value of the property during the marriage (difference between final assets and initial assets related to the property) is then divided equally between the spouses. The correct and often contentious valuation of the property at the start of the marriage (initial assets) and at the date of service of the divorce petition (final assets) is crucial here. Independent expert reports are often necessary for this. Besides ownership issues, usage rights to the matrimonial home must also be clarified, both for the often difficult separation period and for the time after the divorce is finalised (allocation of residence). An amicable, out-of-court solution should always be sought to avoid lengthy, stressful, and costly court proceedings. Auctoa supports you with neutral and data-based property valuations, which can serve as a solid basis for fair and proper agreements in the event of divorce. Keywords: Property Divorce Equalisation of Gains, Equalisation of Gains House Value, House Sale in Divorce, Usage Right Matrimonial Home Separation, Property Valuation Divorce Expert Opinion, Initial Assets Final Assets Property.
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Tenancy law for property heirs: What happens to existing rental agreements?
Heirs automatically and comprehensively enter into existing tenancy agreements pursuant to § 566 of the German Civil Code (BGB), known under the principle "a sale does not break a lease", when they inherit a rented property. This means they assume all rights and responsibilities of the original landlord within the tenancy. No separate consent from the tenants is required for this; the transition occurs by operation of law. However, the heirs are obliged to inform the tenants about the ownership change and their new landlord status. Under certain narrowly defined conditions, heirs may have an extraordinary special termination right according to § 573d para. 2 BGB in conjunction with § 566 BGB. This applies if they have a legitimate interest in terminating the tenancy, such as registering personal use for themselves or close family members (parents, children) or if serious economic reasons necessitate the property’s exploitation (e.g., demolition and new construction, comprehensive renovation that is not possible in an inhabited state), and this exploitation would be significantly hindered by the continuation of the tenancy. This special termination right must be exercised within a certain period after becoming aware of the inheritance and in compliance with statutory notice periods as well as strict formal requirements (written justification). Rent increases are also only possible for the heirs within the limits of statutory regulations, for example by adjusting to the local comparative rent in accordance with § 558 BGB or after conducting modernization measures pursuant to § 559 BGB. The heirs are, of course, also responsible for ongoing maintenance and repair of the property and fulfilling all other landlord obligations arising from the tenancy agreement (e.g., operating cost billing). A thorough examination of the existing tenancy agreements and the current legal situation is essential for heirs to correctly fulfill their new role as landlords and to avoid potential pitfalls. Keywords: tenancy agreement heir landlord, termination of tenancy agreement by heirs, special termination right heir property personal use, rights landlord heir, obligations landlord heir, tenancy inheritance case.
Property Law: Land Register, Land Charge and Easements Explained
Property law is a fundamental part of German property law and regulates the complex legal relationships concerning land. The central and indispensable instrument for this is the land register, a public register kept by the local district courts as land registry offices. It is considered reliable, meaning that one can trust the accuracy of its entries. The land register provides detailed information about ownership (Section I: Owner), about encumbrances and restrictions on the property that are not real estate liens (Section II: e.g., pre-notations, easements such as rights of way or residential rights, real burdens, pre-emption rights, redevelopment notices), as well as about real estate liens (Section III: mortgages, land charges, annuity charges). Anyone who can prove a legitimate interest – including prospective buyers with the owner's authorization, creditors, or notaries – can inspect the land register and request an extract. A land charge is the most frequently recorded real estate lien in practice. It typically serves to secure loans taken out for the purchase or construction of a property. The land charge entitles the creditor (usually a bank) to initiate foreclosure proceedings on the encumbered property in the event of a significant payment default by the debtor (foreclosure or compulsory administration). Easements are encumbrances on one property ("servient property") in favour of another property ("dominant property"), which is called a real servitude (example: right of way, right of pipeline), or in favour of a specific person (limited personal servitude, example: residential right). These rights and encumbrances recorded in the land register are of considerable importance for the value, usability, and marketability of a property and should be carefully examined and understood before any property purchase or sale. A current land register extract is therefore an indispensable source of information. Keywords: land register property explanation, what is a land charge, significance of property easement, registering right of way, residential right land register extract, land register Section I II III.
The Property Purchase Agreement: Important Clauses and Pitfalls for Buyers and Sellers
The purchase contract for a property (land, house, condominium) requires notarisation to be valid (§ 311b Para. 1 BGB). This strict formal requirement serves to protect both parties, ensure expert advice, and guarantee legal certainty of the transaction. The notary holds a neutral position and is obliged to ascertain the will of the parties, inform them about the legal implications of their declarations, and balance the contract. Essential components of a property purchase contract include: the precise identification of the parties (buyer and seller) and the object of sale (property description according to the land register, precise description of the property), the agreed purchase price and its due conditions (e.g., entry of a priority notice of conveyance, availability of mortgage clearance documents from the banks), regulations concerning the transfer of possession, benefits, burdens, and risks (usually with full payment of the purchase price), as well as agreements on the warranty for material defects. In the case of used properties, the warranty for material defects is typically largely excluded ("bought as seen"). However, this exclusion does not apply to defects that the seller fraudulently concealed or for which he has assumed a guarantee. Potential pitfalls may arise from unclear contractual formulations, undisclosed (hidden) defects, issues with securing financing by the buyer, or timely mortgage clearance by the seller. Both buyers and sellers should carefully review the draft contract, which the notary usually must provide at least two weeks before the notarisation appointment (for consumer contracts), and consult the notary promptly in case of uncertainties or desired changes. To secure the buyer's claim to property transfer, a priority notice of conveyance is typically entered in the land register until the final transfer of ownership after payment of the purchase price has occurred. Keywords: property purchase contract notary obligation, content property purchase contract, warranty exclusion house purchase, withdrawal property purchase contract conditions, hidden defects property fraudulent misrepresentation, priority notice land register.
Real Estate Law: Rights and Obligations when Selling Property with an Estate Agent
In the sale or rental of a property through an estate agent, the legal relationship between the client (seller/landlord or buyer/tenant) and the agent is governed by an estate agency contract. Since 2020, this contract requires the text form (e.g., email) for the sale of apartments and single-family houses to consumers, and it defines the rights and obligations of both parties. Various types of agency agreements are distinguished: the simple agency agreement (the client can appoint multiple agents in parallel and also act independently), the sole agency (only one agent is appointed, but the client may still sell/rent independently), and the qualified sole agency (the client commits not to engage other agents and also not to undertake sales/rental efforts without involving the agent; this form is legally sensitive with regard to general terms and conditions). The agent is entitled to the agreed commission (estate agent's fee) if their activity was the cause (or at least a contributing cause) for the conclusion of the main contract (purchase or rental contract) and the main contract has been effectively concluded. Since the amendment of the law on 23 December 2020, the division of the estate agent's commission between buyer and seller generally applies when selling single-family houses and owner-occupied apartments to consumers if the agent acts for both parties (§ 656c BGB). If the agent is appointed by only one party, they cannot demand a commission from the other side unless there is an explicit cost-shifting agreement (§ 656d BGB). The agent's key duties include diligent and expert advice, obtaining and passing on accurate and complete information about the property, organising and conducting viewings, as well as safeguarding the interests of their client. The client, in turn, is obliged to provide the agent with all the information and documents necessary for the brokerage and to pay the agreed commission in the event of success. In the case of distance contracts or estate agency contracts concluded outside business premises, consumers have a 14-day right of withdrawal, which the agent must inform them about correctly. Keywords: estate agency contract property sale, who pays estate agent's commission 2024, sole agency agent advantages disadvantages, duties real estate agent advice, right of withdrawal estate agency contract consumer, text form estate agency contract.
