Additional property acquisition costs

Additional property acquisition costs or transaction costs are costs incurred when acquiring a property in addition to the purchase price for the building and the land. Together with the purchase price, they make up the property acquisition costs.1 In Germany the buyer usually pays all property acquisition costs.2

In particular, additional property acquisition costs include:

  • Notary fees for the notarisation of the property purchase Agreement
  • Land register costs for the entry and deletion of priority notices of conveyance and costs for the transfer of ownership
  • Brokerage fee, the amount of which is highly dependent on standard local rates and the acquisition volume of the property. In Germany this is usually between 1% and 5%
  • Property transfer tax, the amount of which is dependent on the respective federal state
  • Due diligence costs for the comprehensive review of the property before acquisition

In addition to these costs, transaction costs also include the costs of a necessary land survey, legal fees, valuation costs and search costs for the selection of a suitable property. By contrast, development charges and the costs of ground investigations are not counted as additional property acquisition costs.3
Depending on the property and location, the additional property acquisition costs can account for up to 15% of the purchase price of a property. For this reason they are highly important to a property’s profitability.

  • 1 Vgl. Bone-Winkel, Stephan; Isenhöfer, Björn; Hofmann, Philip (2008): Projektentwicklung. In: Schulte, Karl-Werner: Immobilienökonomie, Band I, 4. Aufl. München, S. 285.
  • 2 Vgl. Gondring, Hanspeter (2009): Immobilienwirtschaft. Handbuch für Studium und Praxis, 2. Aufl. Stuttgart, S. 703.
  • 3 Vgl. Sailer, Erwin; Grabener, Henning J.; Matzen, Ulf (Hrsg.) (2014): Immobilien-Fachwissen von A-Z. Das Lexikon mit umfassenden Antworten und Erklärungen auf Fragen aus der Immobilienwirtschaft, 10 Aufl. Kiel, S. 471.
: 18.09.2019