Calculate ancillary costs correctly when buying a house

No demanding landlords, attractive returns and a solid retirement provision – many reasons speak for the dream of owning your own home. Future homeowners, however, have to factor in a lot more than just the purchase price. We present all ancillary costs when buying a house and also show possible savings potential.

• How high are the additional costs?
• Brokerage fee
• Notary and land registry fees
• Real estate transfer tax
• Overview of ancillary costs
• Other additional costs
• Example calculation
• Incidental costs after the purchase
• Financing the additional costs
• Save on ancillary costs
• Calculate construction financing
• Finance the purchase price and ancillary costs favorably

How much are the additional costs when buying a house?

The incidental costs when buying a house for notary, real estate agent and the land transfer tax, which has risen steadily in recent years, must be taken into account. With modernizations or developments at the house further costs can come on the buyer in addition. Therefore one should not count alone on the obligatory additional expenses of up to 15 per cent of the purchase price. And there is more: because even after the conclusion of the purchase agreement incidental expenses are incurred with the new house.

Brokerage fee

If you are not lucky enough to find a property through private contacts, you will have to include the brokerage fees for an estate agent as a further additional cost when buying a house. In contrast to the mediation of rental properties, there is no legal requirement in the sale of real estate whether the sellers or the buyers pay the commission. Regionally different, the commission for the mediation of a real estate sale is therefore either borne exclusively by the seller ("internal commission") or by the buyer ("external commission") or shared between the two.

Theoretically, the brokerage fee can be negotiated freely. In practice, however, the broker usually sets his fee. The amount of the brokerage fee is calculated on the basis of the purchase price of the property. The more expensive a property is sold, the higher the commission for the agent. The amount of the brokerage fees is usually determined by market rates. The ancillary costs can therefore hardly be saved when buying a house, unless you find a property from private sources.

Depending on the federal state, these range from 3.57 to 7.14 percent of the purchase price.

Notary and land registry fees

The construction financing is in place, the purchase contract can be signed. Now comes a further, inevitable point at additional expenses on the house buyer: the notary and land register costs. In Germany, a notary is mandatory for the notarization of the purchase contract. In addition to notarization, the notary's fee includes consultation and drafting of the purchase contract. Notary fees are set out in the German Law on Court and Notary Fees (Gerichts- und Notarkostengesetz, GNotKG) and are calculated as a lump sum at a rate set by law. They are based on the amount of the purchase price. With these additional costs can not be negotiated or saved.

In addition, there are land registry costs, since the new owners must be entered in the public register "land register. In the case of financing via a loan, the entry of a land charge in the land register is also carried out. If necessary, the cancellation of an already existing land charge in the land register or the registration of a right of way, which regulates the passage of other persons, must also be made. Since the notary also takes over the registration of the land charge at the land registry office, he also settles the land registry fees incurred there.

For a calculation one should estimate this block of additional costs altogether with about 1.5 per cent, under circumstances up to 2 per cent of the purchase price.

Real estate transfer tax

One of the biggest bills after buying a house comes from the tax office: the real estate transfer tax notice. Because as soon as ownership of a property is transferred to another person, a one-time land transfer tax is incurred. The tax offices multiply the notarized purchase price by the real estate transfer tax rate. Buyers of existing real estate can reduce the real estate transfer tax and thus save on incidental costs when buying a house by transferring movable (z.B. The notary and land registry can be negotiated freely, but the purchase contract must separate the built-in kitchen, fireplace, and sauna from the immovable components of the property. This is because only the property itself is subject to the tax – and any fixtures and fittings that are inseparably connected with the house.

The amount of the real estate transfer tax rate is a matter for the federal states, so tax rates vary in Germany.

The real estate transfer tax rate is lowest in Bavaria and Saxony. Real estate buyers must pay 3.5 percent of the purchase price to the tax office as real estate transfer tax. Property buyers in Thuringia, North Rhine-Westphalia, Schleswig-Holstein, Brandenburg, Thuringia and Saarland have to pay the most, at 6.5 percent.

The standard ancillary purchase costs at a glance

Other additional costs when buying a house

Broker, notary and land transfer tax are, so to speak, the classics of incidental costs when buying a house. In addition, there are other costs and fees that may be incurred and should be taken into account: Financing costs interest, modernization can consume additional money (and sometimes nerves), for builders development costs can make the purchase more expensive, and finally the move also wants to be paid for.

Financing costs: This is how the lender earns

In most cases, the future homeowner takes out a real estate loan for the purchase. How high the additional costs for the financing are such as interest surcharges or account fees, the buyer can let himself calculate from the credit institute. The so-called effective interest rate in the financing offer then provides information about the amount of the costs. This comprises the actual cost of the loan, including ancillary costs:

• the repayment rate
• The duration of the fixed interest rate
• the disbursement rate
• the number of interest payments.

The effective interest rate must be included in every loan offer. In this way, the borrower has a reliable comparison tool in hand to compare the various offers and then decide on the offer with the lowest ancillary financing costs. However, the effective interest rate does not include commitment interest, partial disbursement surcharges, valuation costs or account management fees. These can drive up the cost of the loan. Banks are however obligated after the price indication regulation (PangV) to list all costs for a credit transparently. Thorough research and negotiation can therefore save on ancillary costs during financing.

costs for modernization

Anyone who still has to carry out expensive renovations or refurbishments to a property before it is used or. would like, must modernization costs as further additional costs into its financing of the house purchase also take up. Purchasing an inexpensive property that still needs to be rehabilitated can be less expensive than buying a property that is ready for occupancy. Here the house buyer can save, because on the modernization costs no purchase additional expenses result. The renovation costs can still be considerable: Does the heating system still comply with the strict rules of the Energy Saving Ordinance (EnEV)? There is rarely any way around the renewal of electrical installations. Bathroom renovation and a new kitchen can be accompanied by a new living room layout. Perhaps also the garden is to be put on again and equipped with a Veranda? Floor coverings, new doors and windows, insulation of the roof, facade and basement – even if you can do the modernization yourself and thus save on labor costs, you must at least calculate the cost of materials.

Building owners watch out: Incidental cost trap of land development

With the purchase of an inventory real estate the buyer does not compute generally with development costs as additional expenses. Finally, roads, sidewalks, lighting, sewerage, water, electricity and gas lines are created. However, it can happen that the measures have apparently been completed for decades – but in fact a planned measure is still missing. If this is carried out, the municipality has four more years to settle the costs. Thus, the homeowner can unexpectedly incur five-figure ancillary costs, even though the property in question is an old existing property.

In the broker expose should be noted therefore whether the property is not, partially or fully developed. The buyer should therefore ask to see the notices applicable to the property. Also the municipality can supply information whether the development costs for the property were already settled. If the development costs are still outstanding, the prospective buyer can negotiate a discount on the purchase price or agree that the seller will bear these ancillary real estate costs. The notary can adjust the purchase contract for the house accordingly. If the buyer is to bear the costs alone, he must adjust his financing accordingly.

A case study of common incidental costs when buying a house

The Fischer family is interested in a 20-year-old terraced house in Hamburg-Poppenbuttel, which a real estate agency has listed on a property portal for 480.000 euro offers. In Hamburg it is usual that the buyers pay the brokerage fee. The modernization costs are manageable, but the family would like to make some changes, especially in the kitchen and bathroom.

Table: Case study for common additional costs when buying a house

The total sum of the additional expenses in our case study amounts finally to 92.522 euros.

Incidental costs after the purchase of real estate

The purchase price has been settled and all bills from surveyors, tradesmen, from the estate agent's office, the tax office, the notary's office, the land registry, from moving companies and furnishing houses have also been settled. Now, however, the ongoing ancillary costs for the newly acquired house come into play, the so-called operating costs. These regular charges and consumption costs are in addition to the monthly loan installment for the real estate financing. The homeowner pays the various utilities directly to the municipality and companies. Depending on the size, location and condition of the house or apartment, these burdens can vary greatly.

In the case of an owner-occupied apartment, the so-called house service charge is incurred. The house money is higher than the additional costs with the rent, since not all additional costs are apportionable on the tenants. In any case, the future homeowner should obtain an overview of the ancillary costs for the property in question before purchasing the real estate. Heating costs in particular can vary greatly depending on the property. Here, investments in energy-efficient modernization can pay off for the homeowner by saving on ongoing ancillary costs. From the seller or broker, the future owner will have access to the relevant documents. The current costs and the real estate financing must be served finally durably.

Enclosed is an overview of the current ancillary costs for your own home or. the own dwelling:

• Property tax
• water supply
• Sewage/precipitation water
• Heating costs incl. Operating electricity for the heating system as well as cleaning and maintenance
• Hot water, incl. cleaning and maintenance
• Street cleaning
• Garbage disposal
• Exterior lighting
• Chimney sweep
• Residential building insurance
• Costs for telephone, internet and TV reception
• Accumulation of reserves

Financing of the additional costs

It is possible to take out a conventional installment loan in addition to the real estate loan, with corresponding interest charges for the incidental costs of the house purchase. These are two separate financing. This installment loan is not registered in the land register, as it is usually granted without a purpose of use. The interest for an installment loan is higher than that of the real estate financing and also this financing wants to be paid off in the course of the years.

We therefore recommend that you cover the ancillary costs from your own capital and save this interest.

Save on ancillary financing costs by making the loan interest-free

Upon conclusion of the loan agreement, the bank is obligated to keep the full loan amount available. If the completion or purchase of a property is postponed, the buyer may incur additional ancillary costs when buying a house, as the institutions charge commitment interest as compensation for this period of time. If the loan is disbursed in several steps, the partial sums also accrue commitment interest. Some banks also charge a partial disbursement surcharge.

Incidental financing costs can be saved by negotiating the longest possible interest-free period with the bank. Usually three months, in which still no commitment interest is calculated. But this is also a matter of negotiation: some banks provide the loan interest-free for up to six months. Particularly for buyers of a new building should be paid attention here to save possible additional costs, because they do not need the purchase sum with the house purchase at one blow, but pay building section for building section. Particularly in the case of new buildings, completion can be delayed, and then commitment interest is particularly annoying.

Also be wary of annual caps on unscheduled repayments or fees for unscheduled payments. Anyone who wants to repay the entire sum early thanks to an unexpected windfall must reckon with the bank charging an early repayment penalty. In order to save further costs here, the borrower should negotiate these possible ancillary costs with the lender even before taking out financing and possibly contractually stipulate several special repayment options.

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Purchase price and additional costs with the house favorably finance

The incidental costs of buying a house are indeed not to be underestimated and must be carefully considered from the beginning when planning your real estate loan. After all, you don't want any surprises at the end. Regardless of whether you want to pay for the additional costs of your house out of your own pocket or finance them together with the purchase price, our construction financing specialists will work with you to find suitable and low-interest offers.

Construction financing at favorable interest rates with personal advice

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