Tips & facts Important tips on buying your own home

Many people dream of owning a house or apartment – it’s better to invest in your own home and build up assets than to pay rent. To make your dream come true, we have put together a guide on buying your own home that explains the typical pitfalls.

Purchasing a property is the biggest acquisition in many people’s lives. This change can have far-reaching consequences for their personal finances and quality of life. This makes it all the more important to do thorough groundwork beforehand. Make sure you allow enough time.

The first pitfall looms even before you start looking for property – not knowing your own budget. You should therefore start by calculating the maximum price you can afford. It’s not just the purchase price itself you should take into account, but also any conversion or renovation and, in particular, maintenance costs. Make a list of the criteria that are important to you, such as location, size or furnishings. After these two steps, you will be much more focused in your search for your dream property.

The general principle to observe is “buy what you see.” You must check the property and purchase contract thoroughly before signing. Unless otherwise specified in the contract, it is subject to the applicable statutory provisions.

Claims regarding defects in the work or property asserted by the buyer or customer lapse two or five years after acceptance of the work or delivery, depending on the cause. However, depending on the basis for the defect, other limitation periods may apply. The notification and rectification of defects should be demanded rapidly; the burden of proof lies with the buyer. The purchase contract can usually only be canceled in extreme cases. Conversely, you are obliged to pay the contractually agreed sums on time, although a reduction in the price to be paid is possible under certain circumstances.

Clarity: Costs, deadlines and services must be defined precisely and in as much detail as possible. All the documents describing the property must form part of the contract. Caution is advised if the building description is brief and imprecise.

Price: Be wary of promises of fixed and all-inclusive prices. In practice, buyers often find that many equipment details are not included in these flat rates. In addition, high surcharges may be demanded for changes and additional requests.

Modifications: When you buy a property off-plan, it is usual for the buyer to request modifications. The kitchen, floor coverings and bathroom fittings are often customized. Make sure that the procedure is set out in the contract. The additional costs and expenses incurred by the contractor must be agreed in writing in advance. Verbal or unclear statements can be expensive.

Condominium ownership: You should also check the condominium ownership documents. In particular, these include the regulations and the publicly certified deed of foundation, which defines the value quotas and size of condominium units, the renovation fund, etc.

If you need any further information, you can contact the following associations:

Obtaining financing confirmation from the bank will enable you to clear an important hurdle on the path toward buying a home. The lender will check your credit rating and the value of the property.

There are a number of points that you should critically assess before choosing your property. We have summarized them in our “Home ownership checklist: important points and requirements when searching for property.”

Bank appointment

Make an appointment with one of our client advisors. They will clarify whether you meet the financial framework conditions and discuss which mortgages are suitable for you.

Contract

The purchase contract for a property must be certified by a notary. As a rule, a notary draws up the contract. It essentially contains details of the parties, the purchase price, any advance payments, payment terms, transfer fees and the date of transfer of ownership. The contract should be available before the notary’s appointment so that you have enough time to check it thoroughly. If necessary, ask for assistance.

Transfer of ownership

You only legally become the owner when you are entered as such in the land register.

It pays to closely examine contracts and to call in experts.

Take a close look at the property and don’t forget the rest of the building (in the case of condominiums, the shared parts, the renovation fund, etc.). You must read and understand all contracts carefully.

If in doubt, you should seek advice.

When obtaining financing, you should ensure that you have a sufficient financial cushion that takes into account not only the purchase price, but also any renovation, conversion and maintenance costs.