The most important things about the process of buying a house:

• The process of buying a house essentially includes determining your budget, finding a suitable property, financing, the notary appointment and paying the purchase price and official fees.

• Timing and financial planning are particularly important for a smooth real estate purchase.

• It is worth comparing the loan offers of different banks.

• The sale of the property ends with the handing over of the keys at the house inspection, which you should record.

1. Step: Budget planning

For the house purchase to go smoothly, you should plan your budget carefully. Excessive loan instalments can lead to financial bottlenecks and reduce the enjoyment of owning your own home. If it is not possible to repay the loan over a longer period of time, you may even lose the new property - for example, through a foreclosure. For this reason, a realistic financing model is of central importance.

Determine the right loan rate

To ensure that the purchase of a property proceeds safely, you should first determine a suitable loan rate. The best way to do this is to keep a budget book a few months before the purchase. In it, you record your income and all recurring expenses. The balance shows your individual financial surplus. Together with your current rent, this gives you the amount you can spend each month to finance your property.

Determine your own capital

Once you know the maximum amount you can repay, you need to determine your equity. Banks usually require proof of 20 to 30 % of the purchase price as a reserve to ensure financing of the incidental costs of purchase. These consist of:

• Land transfer tax (3.5 to 6.5 %)

• Land registry and notary fees (approx. 1.5 %)

• if applicable, costs for estate agents (3 to 7 % of the property value)

The higher your contributed equity capital, the lower the interest and loan costs. Financing without equity is possible in special cases.

Calculate the maximum purchase price

Once you have determined the amount of the loan instalment and the disposable income, you can use the following formula to calculate the maximum purchase price:

Then add the calculated loan amount to your own capital and subtract the incidental costs of purchase and the financial buffer.

2. Step: The property search

You can start looking for a property once the maximum purchase price has been determined. In order to obtain a representative and broad selection of suitable properties, you should use different channels, for example:

1. Newspaper

2. Online portals

3. Estate agents

4. Recommendations from your own environment

At Engel & Völkers you can find your dream property in just a few clicks. Simply enter the desired criteria and you will receive a list of suitable properties. Click here to go to the online search if you want to buy a house or use our property alert.

When viewing a property, a critical and objective look as well as complete information help to rule out wrong decisions. Important factors in the property search are:

1. attractive location with good infrastructure, such as shops for daily needs, schools and medical care

2. good condition of the property and building fabric

3. proper land register entries, without any encumbrances or reservations

Before deciding to buy a property, ask to see all the prescribed documents such as the register of contaminated sites, parcel maps, development plans and energy certificate. In the case of condominiums, the declaration of division, house rules and minutes of the owners' meetings are also essential.

If you are interested in the property, you should also have an expert's report prepared. An expert can reliably rule out defects in the house to protect you from unpleasant surprises. If these only become apparent after the purchase, it is up to you as the buyer to rectify them.

3. Step: Financing

To finance the purchase, you will usually need a suitable loan. The credit offers of the banks sometimes differ considerably with regard to terms, interest rates and total credit costs. Therefore, you should compare the financing offers of different financial institutions to find the most favourable loan for your situation.

Careful preparation will speed up the approval of the financing. You should have all the important documents ready:

• Key data on the property (exposé, plans, land register, photos, purchase contract, calculation of living space)

• Salary statement (last three months)

• Income tax statement or pension statement

• Schufa self-assessment

• if applicable, information on existing loans or private health insurance Profit statement or balance sheet for self-employed persons

Have you agreed on the repayment rate, interest rate and fixed interest rate with the credit institution? Then you must request the financing commitment from the bank. This is absolutely necessary for the notary appointment.

4. Step: Notary appointment & signing the purchase contract

The notary appointment is essential to officially record your house purchase. Once you have all the necessary documents and information, the notary will draw up the draft purchase contract. You should receive this at least 14 days before the official date for signing the contract. This gives you enough time to check all the conditions in detail.

Check all the details in detail and, if in doubt, have them assessed by a third party. This can be done by lawyers or real estate agents. In this way, disadvantageous clauses can be identified early on and rectified.

When the purchase contract is signed, both parties receive a printed copy of the contract, which the estate agent reads out word for word. Any queries or changes can still be made at this stage. If there are no objections, the contract is signed by all parties.

Pay attention to the so-called priority notice of conveyance (§ 883 German Civil Code (BGB)). As a legally binding reservation, it prevents the seller from selling the house elsewhere or encumbering it with a land charge before your entry in the land register as the new owner.

5. Step: Payment of purchase price & land transfer tax

Between the signing of the purchase contract and the payment of the purchase price, the notary handles numerous processes in the background. These include informing the tax office that the priority notice of conveyance has been given. Based on this, the real estate transfer tax owed by the buyer is determined. Depending on the federal state, it amounts to between 3.5 and 6.5 % of the purchase price. Payment of the purchase price is also due during this period. You can find the exact time and terms of payment in the purchase contract.

As soon as you have paid the real estate transfer tax, the responsible tax office will contact the notary again to send the so-called clearance certificate. This is a prerequisite for the notarial change in the land register. The house then officially becomes your property.

6. Step: Handing over the property

Have you signed the purchase contract and paid the land transfer tax and the purchase price? Then you can soon move into your dream home. Once the land register has been changed, the time has come for the physical handover.

You can agree the time of handover individually. In practice, it is common for buyers to pay the purchase price first before moving in. Other arrangements are also possible by mutual agreement.

During the handover of the property, the former owners will hand over all important documents and the keys to the property. During an inspection, you should have the technical features of the building explained to you, such as the functions of smart home technologies or the heating system.

Conclusion on the timing of the purchase of a house

Buying a house is a complex business and the process can be overwhelming at first. By proceeding systematically and thoughtfully, you can avoid pitfalls and possible obstacles during the purchase. Realistic budget planning, plenty of time to search for a suitable property and viewing are essential to finding the best property. Thoughtful financial planning and professional advice (from building experts, specialist lawyers or estate agents) prevent costly wrong decisions at your expense. The time, effort and care will pay off at the latest when you move into your new home.