Heritable Building Right in Berlin: Buying a Flat or House with an Erbbaurecht
The listing says “Erbbaurecht” or “Erbpacht”. This means you buy the house or flat, but not the land underneath. For the use of the land you pay an ongoing ground rent (Erbbauzins). The State of Berlin generally grants its own land as a heritable building right.
Table of contents
At a glance – heritable building right
- Building instead of land: With a heritable building right you acquire the right to have a building on someone else’s land. In return you pay the landowner a ground rent.
- Consent: Most agreements require the landowner to consent to the sale and to your bank’s land charge. Without this consent the purchase agreement is not effective. The notary obtains it.
- End of the term: The law provides for compensation for the building. The contract can set the amount or exclude it entirely. The law only guarantees two thirds of the value in one special case.
- Real estate transfer tax: The tax office calculates it on the purchase price plus the ground rent capitalised over the remaining term. The worked example below shows the effect.
- No municipal right of first refusal: When someone buys a heritable building right, the municipality has no right of first refusal. You do not need a negative certificate.
- Property tax: You pay the property tax for the building and the land.
What is a heritable building right?
A heritable building right is the right to have a building on someone else’s land. You can sell and inherit it (section 1 (1) ErbbauRG). Legally, the building belongs to the heritable building right, not to the land (section 12 ErbbauRG). “Erbpacht” is only the colloquial German term for it. It is not a lease within the meaning of the BGB.
The heritable building right agreement sets out exactly what applies. It mainly regulates the term and the ground rent. It can also regulate, for example, the duty to maintain the building, the grounds for reversion, a preferential right to renewal and a right to buy the land (section 2 ErbbauRG).
Heritable building right register and flat ownership
For every heritable building right the land registry opens its own register folio, the heritable building right register (Erbbaugrundbuch, section 14 ErbbauRG). In the land register of the plot, the heritable building right stands in first rank (section 10 ErbbauRG). For the structure of the land register, see our article on the land registry.
Anyone who buys a flat on land held under a heritable building right acquires a heritable building right in a flat (Wohnungserbbaurecht). It has its own register folio. The rules on flat ownership apply to the flat (section 30 WEG).
Ground rent: amount and adjustment
The ground rent is the payment for the use of the land. The land register records it like a charge on the land (Reallast, section 9 (1) ErbbauRG). The agreement sets the amount, for example 2,400 euros a year.
For new agreements for single-family homes and owner-occupied flats, the State of Berlin applies a ground rent rate of 4 percent (Senate decision of 8 June 2021). According to the Senate Department for Finance, it grants such rights for up to 75 years. Anyone who buys an existing heritable building right pays the ground rent under the existing agreement.
Many agreements contain an indexation clause. The law permits it if the term is at least 30 years (section 4 PrKG). If the building is used for residential purposes, the ground rent may rise no earlier than three years after the parties concluded the agreement or after the last increase. An increase beyond the development of general economic conditions is usually inequitable (section 9a ErbbauRG).
What happens at the end of the term?
At the end of the term the heritable building right expires. The building passes to the landowner (section 12 (3) ErbbauRG). In return the landowner owes compensation (section 27 (1) ErbbauRG). The agreement can set the amount or exclude it entirely.
The law only requires at least two thirds of the value of the building for heritable building rights granted to meet the housing needs of low-income groups (section 27 (2) ErbbauRG). The two-thirds rule does not apply to other heritable building rights, even though many sources claim otherwise. The agreement sets out what applies to your right.
The landowner can avoid paying compensation by offering you, before the term ends, an extension for the expected remaining life of the building. If you decline such an extension, the compensation lapses (section 27 (3) ErbbauRG).
You only have a preferential right to renewal if the agreement provides for one. It only applies once the landowner agrees a new heritable building right with another person, and it expires three years after the end of the term. You cannot exercise it if the new heritable building right is to serve a different economic purpose (section 31 ErbbauRG).
If the parties extend a heritable building right in return for ground rent, real estate transfer tax is payable (Federal Fiscal Court, judgment of 10 July 2024, II R 3/22).
Reversion: when the right falls back early
The agreement can provide that you must transfer the heritable building right to the landowner in certain cases (section 2 no. 4 ErbbauRG). Because of unpaid ground rent, this is only possible once at least two years’ payments are outstanding (section 9 (4) ErbbauRG).
A sale without the required consent may not be a ground for reversion (section 6 (2) ErbbauRG). On reversion you are generally entitled to reasonable remuneration for the heritable building right. The agreement can set the amount or exclude it (section 32 (1) ErbbauRG). For heritable building rights granted to meet the housing needs of low-income groups it cannot be excluded and must be at least two thirds of the value of the heritable building right (section 32 (2) ErbbauRG).
Heritable building right or full ownership: differences, pros and cons
The table shows how buying a heritable building right differs from buying a property together with the land.
| Heritable building right | Ownership including the land | |
|---|---|---|
| What you buy | building or flat, the land stays with the landowner | building and land |
| Purchase price | without land value, usually lower | including land value |
| Ongoing costs | ground rent, often with adjustment | no ground rent |
| Real estate transfer tax | on the purchase price plus capitalised ground rent | on the purchase price |
| Consents | usually needed for sale and land charge, for flats possibly also the property manager’s | for flats, possibly the property manager’s (section 12 WEG) |
| Financing | lending often limited, rank of the land charge to be clarified | usual |
| Value as the remaining term falls | may fall | depends on the market |
| End | building passes to the landowner, compensation as agreed | unlimited |
| Property tax | for building and land (section 261 BewG) | for building and land |
Whether a heritable building right makes financial sense for you depends on the purchase price, the ground rent and the remaining term.
Buying a flat or house with a heritable building right: the process
A notary must notarise the purchase agreement for a heritable building right (section 11 (2) ErbbauRG, section 311b (1) BGB). After that, the purchase proceeds as for any other property, with a priority notice and transfer in the land register. There is no municipal right of first refusal for a heritable building right (section 24 (2), section 25 (2) BauGB). Contractual rights of first refusal or those entered in the heritable building right register may still exist. If the property is in a formally designated redevelopment area, the sale also requires the municipality’s approval (section 144 (2) BauGB).
Check before buying
Ask for the heritable building right agreement with all amendments and the latest ground rent adjustment, and a current extract from the heritable building right register. Pay attention to these points:
- remaining term
- amount of the ground rent and adjustment clause
- ground rent arrears
- grounds for reversion
- rules on compensation at the end of the term
- consent requirements for sale and land charge
- right to buy the land
- contractual rights of first refusal and those entered in the register
- for a flat, also the declaration of division, community rules, recent resolutions, budget and annual statement
The landowner's consent
Most agreements require the landowner to consent to the sale (section 5 (1) ErbbauRG). Until the landowner consents, the purchase agreement is provisionally ineffective (section 6 (1) ErbbauRG). The land registry only registers you once you have proven the consent (section 15 ErbbauRG).
The notary obtains the consent. The purchase price only becomes due once the landowner has consented. The landowner must consent if the purpose of the heritable building right is not significantly impaired and you offer assurance that you will meet the obligations under the agreement. If the landowner refuses consent without sufficient reason, the local court can replace it (section 7 (1), (3) ErbbauRG). How long this takes and whether the landowner charges a fee for it depends on the landowner. Ask about this before you buy.
Financing: consent to the land charge and rank
Your bank’s land charge usually also needs the landowner’s consent (section 5 (2) ErbbauRG). You are entitled to it if the charge is consistent with proper management and does not endanger the purpose of the heritable building right (section 7 (2) ErbbauRG). For heritable building rights granted by the State of Berlin, the Senate Department for Finance states that, with proof of creditworthiness, the State generally consents to a charge of up to 60 percent of the value of the heritable building right, or alternatively up to 70 percent of the value of the building. Clarify how much equity you need with your bank at an early stage.
For financing, what matters is the rank of the land charge relative to the ground rent and what happens to the ground rent in a forced sale. The parties can agree that the ground rent remains in place in a forced sale and that the bank’s land charge ranks ahead of it at the same time (section 9 (3) ErbbauRG). For how to register a land charge, see the page Registering a land charge.
You can enquire about buying a heritable building right using our enquiry form.
What does buying a heritable building right in Berlin cost?
The same fee rules apply to notary and land registry as for a comparable property purchase. The amount depends on the transaction value and the work required. Obtaining the consent is included in the notary’s completion fee. For the same purchase price, the real estate transfer tax is higher because the ground rent is included. In the example below, the additional purchase costs come to around 23,960 euros, which is around 8 percent of the purchase price.
Real estate transfer tax: purchase price plus ground rent
When someone buys a heritable building right, the ground rent counts as part of the consideration. The tax office capitalises it over the term of the heritable building right and adds it to the purchase price (Federal Fiscal Court, decision of 23 April 2020, II B 80/19, and judgment of 22 October 2025, II R 5/22). The Valuation Act sets the multiplier (section 13 BewG, Annex 9a).
| Item | Calculation | Amount |
|---|---|---|
| Purchase price | €300,000 | |
| Ground rent, capitalised over 60 years remaining term | €2,400 × 17.930 | €43,032 |
| Tax base | €343,032 | |
| Real estate transfer tax 6% | rounded down to full euros | €20,581 |
For a purchase including the land at the same price of 300,000 euros it would be 18,000 euros. The tax office sets the exact amount. It is open, for example, how it takes an indexation clause into account or, for flats, the flat’s share of the ground rent. Clarify questions about your case with your tax adviser.
Worked example: flat with a heritable building right for 300,000 euros
The assumptions are a purchase price of 300,000 euros, ground rent of 2,400 euros a year, a remaining term of 60 years and completion with a priority notice and monitoring of the purchase price payment. The transaction value is the purchase price; the value under section 49 (2) GNotKG is not higher. The notary also generates structured data in XML format.
| Item | Calculation | Amount |
|---|---|---|
| Notarisation of the purchase agreement (KV 21100) | 2.0 × €635 | €1,270.00 |
| Completion, including the landowner’s consent (KV 22110) | 0.5 × €635 | €317.50 |
| Supervision: checking when payment is due and monitoring the transfer (KV 22200) | 0.5 × €635 | €317.50 |
| Structured data in XML format (KV 22115) | 0.1 × €635 | €63.50 |
| Expenses: postage, copies, land register searches (estimated) | €46.00 | |
| VAT 19% | €382.76 | |
| Fee of the electronic deed archive | €4.50 | |
| Notary | €2,401.76 | |
| Land register: priority notice, its cancellation, registration as holder of the right (KV 14150, 14152, 14110) | €977.50 | |
| Real estate transfer tax | see above | €20,581.00 |
| Total | €23,960.26 |
If the purchase price is below 80 percent of the value of land and building, the notary and land registry use this higher value (section 49 (2) GNotKG). A land charge of 240,000 euros adds further costs: 535 euros each for notarisation and registration in the land register, plus expenses, VAT and, where applicable, completion fees, for example for the consent to the land charge. For the other purchase costs, see the article Property purchase costs in Berlin.
Practical tip: Get the heritable building right agreement before you talk to your bank about financing. The remaining term, the ground rent and the consent requirements affect whether and how much the bank will lend.
Prepare the purchase of a heritable building right
Would you like to buy a flat or house with a heritable building right in Berlin? Send us the key details and, if available, the heritable building right agreement. We will get back to you with the next steps.
Frequently asked questions: heritable building right (FAQ)
What is the difference between Erbbaurecht and Erbpacht?
Legally there is only the heritable building right (Erbbaurecht) under the Heritable Building Rights Act. “Erbpacht” is the colloquial term for it. It is not a lease within the meaning of the BGB.
Can I buy a flat with a heritable building right?
Yes. You then buy a heritable building right in a flat with its own register folio (section 30 WEG). The rules on flat ownership apply to the flat, the heritable building right agreement to the land.
Who pays the property tax for a heritable building right?
The holders of the heritable building right, for land and building together. The tax office attributes the entire value to the heritable building right (section 261 BewG).
What happens if the landowner does not consent?
Until the landowner consents, the purchase agreement is not effective. If the landowner refuses consent without sufficient reason, the local court can replace it on application (section 7 (3) ErbbauRG).
Can I buy out the ground rent and acquire the land?
Only if the agreement provides a right to buy or both sides agree (section 2 no. 7 ErbbauRG). The State of Berlin generally grants its own land as a heritable building right.
What should I look out for before buying a heritable building right?
The remaining term, the amount and adjustment of the ground rent, the rules on compensation at the end, the grounds for reversion and the consents required. The checklist above lists all points.
Can I sell or inherit a heritable building right?
Yes, a heritable building right can be sold and inherited (section 1 ErbbauRG). For a sale you usually need the landowner’s consent. Inheritance itself is not a sale. If the community of heirs later transfers the heritable building right to one person, this counts as a sale and requires the agreed consent (section 5 (1) ErbbauRG).
What happens to the house after 99 years?
When the term ends, the house passes to the landowner. The landowner owes compensation, the amount of which the agreement regulates or can exclude. Instead of paying, the landowner can offer you, before the term ends, an extension for the expected remaining life of the house (section 27 ErbbauRG).
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Heritable building rights with a notary in Berlin
The notary notarises the purchase agreement for the heritable building right, obtains the landowner’s consent and arranges the registration in the heritable building right register. You can find further services relating to buying property on the page Notary for real estate law in Berlin.
