Investing into Real Estate in Germany - the SAGA*

*warning - contains long German words

As many of you will already know we have been looking at buying an apartment here in Berlin for some time (just under a year), so I thought it might be about time to give an account of our trials and tribulations. Around May we found our "dream home" (pics here). It was a lovely Dachgeschoss (rooftop) 94sqm Wohnung (apartment) with a big terrace and open plan kitchen. Right when we went to see it we knew it was the one, and told the seller (Herr F.) that we want to buy it - on the spot. Herr F. had lots of interested parties and hence decided to wait until he got all the offers. We ended up being the highest bidders (giving him the asked price), and then all the fun began.

I actually started writing up a drawn-out very long account of what happened, but decided to scrap that and give a short summary...

1) there were problems with the flat: zweiter Rettungsweg (fire escape), Wärmedämmung (insulation) of the roof and the terrace
2) there were VERY MANY PROBLEMS with the Wohngemeinschaft (body corporate equiv.) - actually with them, and also with the fact that they were doing lots of dodgy accounting documented in the last couple Eigentumsversammlungsprotokollen (minutes of the meetings of the community of flats)
3) the Teilugserklärung (partition deed - how the flats are divided in the house) didn't reflect in a lot of ways how the flat was _actually_ layed out
4) there were documents missing (eventually restored though): staatliche Bauabnahme (acceptance of construction work)
5) right in the end (last Tuesday) when were were at the Notar (notary), Herr F. refused to guarantee that the flat is actually his - in a legal sense that he didn't steal any area from any of his neighbours when it was built in 1994.

At that point (at the notary) we decided there was WAAAAY too much risk involved, and didn't sign the Kaufvertrag (deed of purchase). And now 4 months, two drawn-up and then again revoked Darlehen (mortgage), about 1500EURs in legal costs (final bill still coming), three quarters of two heads combined of grey hair, about a million broken nerves later we're still looking for a place to buy :) In essence we're happy that we didn't end up buying something very crappy with lots of problems, and now we know pretty much everything there is to know about property buying in Germany, thanks to our wonderful lawyer (if anyone needs one in Berlin, give us a bell). So we're not completely sour. We actually found some good options this last weekend - 1) a new set of flats that are being built (only ready Oct 2008 though) with really well layed-out rooms and two big terraces, and 2) a Dachgeschoss which is reasonably priced, but needs some work done (taking out a couple of walls to make one big lounge room). Thus there are options on the table and Maklers (real estate agents) running around finding out the information we requested.

TBC...