Checklist 2: The notarial contract of sale
Be on the safe side with just 30 questions - how to make sure your contract of sale is waterproof!
A contract of sale of property must always be concluded before a notary. Two weeks before the contract is concluded, a draft must be submitted to both parties.
2. Everything complete?
In addition to the notarial contract, do you also have all of the other documents, such as an approved construction specification, floor plans and construction file, site plan and a certified extract from the land register?
A chapter in itself. Have you already had the contract and all of the documents examined by a lawyer and the tax advisor and/or by your bank advisor? Make sure you allocate sufficient time for this!
4. Land register:
Have you inspected the land register yourself and is all of the data stated in the draft contract of sale correct? All rights and encumbrances are also important. The notarial contract has to contain a note stating that the notary has inspected the land register.
The land register shows the owner. If the owner is represented by another person in the notarisation, this person must have a notarial power of attorney.
6. Change requests:
If you have any requests for changes, additions or deletions in the draft contract, these can be made both before or during the meeting with the notary at any time.
7. Basic information correct?
From your point of view, is all of the basic information such as the purchase price, plot area, living area, balcony and terrace areas, other useful area, number of rooms, parking spaces, garages, fixtures and fittings mentioned?
8. Purchase price:
After the total amount has been stated, this must also be divided into the shares for building substance and land – important for the tax office and thus for your tax advantages.
9. Condition under building law:
The contract of sale must clearly state whether the plot has been built on or not, is connected or not and what has been built on it.
10. Priority notice:
In order to secure your right to the transfer of ownership, the contract must contain a priority notice, so that the seller cannot sell the property again before the transfer of ownership or encumber it with further entries.
Are all of the furnishings or accessories that you have negotiated in the contract of sale and the purchase price listed in detail with individual prices in the contract?
12. Common charge:
Check whether the draft contract of sale of a freehold apartment contains the amount of the common charge payment and that the seller is not in arrears. This should be expressly confirmed, as otherwise you will be liable for the additional payments and will be asked to pay.
13. Purchase price due for payment:
Ein Kapitel für sich. Haben Sie den Vertrag nebst allen Unterlagen bereits von einem Juristen und dem Steuerberater und/oder von Ihrem Bankberater prüfen lassen? Nehmen Sie sich hierzu ausreichend Zeit!
14. Development costs:
Has the contract taken into account who pays possible development or other costs, such as road construction contributions? If applicable, the owner must ensure payment is made.
15. Additional documentation:
You should try to get the seller to assure that he will obtain any missing documents or additional documents requested by you, such as the energy pass.
16. Maintenance reserve:
Insist that the contract of sale shows the price for the freehold apartment and the amount of the maintenance reserve attributable to it. This part is exempt from property transfer taxes.
17. Entitlement to claim rent:
You should specify precisely when you will be entitled to claim all rents, for example with payment of the purchase price or not until your entry as owner in the land register.
18. Transfer of ownership (benefits and encumbrances):
Set the date for transfer of ownership or for transfer of benefits and encumbrances, which is often identical with the date set for entitlement to claim rent and also regulates the date for all payment obligations of the buyer, with payment of the purchase price or change of ownership.
19. Right of first refusal:
Check whether the municipality or another authority has a statutory right of first refusal. However, this request for information about right of first refusal will also be made officially by the notary and obtained by him.
20. Property transfer tax:
The property transfer tax is between 3.5% and 5%, depending on the federal state, and does not constitute a prerequisite for payment of the purchase price. It is usually borne by the buyer. However, both the buyer and the seller are liable for payment of this tax as well as the other incidental costs.
Remember that the homeowner’s insurance is first transferred to you by law. You have an extraordinary right of termination 30 days after the transfer of ownership (land register).
22. Partition deed:
If the partition has not yet been effected in the land register, you should check whether the building authorities have already issued a binding certificate of self-containment with a partition plan.
23. Planned conversion:
If you are planning a conversion before reletting, have the exact construction specification and the seller’s consent included in the contract. The same applies to any modernisation.
24. Defects and health hazards:
Make sure that the seller guarantees in the contract of sale that he is not aware of any hidden defects or health hazards (contaminated soil, evaporation of wood preservatives and formaldehyde, material containing asbestos).
Do you have the seller’s assurance that the building or freehold apartment is free from dry rot, woodworm and other pests such as cockroaches, bugs and spider beetles? (seller is liable)
26. Seller moving out:
If the landlord himself lives in the freehold apartment and does not move out in due time, a reduction of the purchase price should be agreed beforehand in the contract of sale, which is always better than a subsequent rent payment, which you even have to pay tax on.
27. Rent control – subsidised housing:
Has the seller assured you that the property is not subject to rent control under the Controlled Tenancy Act (Wohnungsbindungsgesetz), especially if you have not benefited from the subsidised housing?
28. Warranty claims:
Has the seller legally transferred/assigned to you any remaining warranty claims against his craftsmen?
29. Commercial use:
If the property is used in whole or in part for commercial purposes, the seller should declare and be instructed by the notary that there are no VAT arrears.
30. Leasehold contracts:
Make sure that you can freely dispose of the leasehold and, if necessary, sell the property again without any problems. Has a right of first refusal also been agreed for you?