Property tax on real estate: annual cost of your first apartment

Property tax for real estate – If you own a property or are the owner of an apartment, you have to pay property tax. Depending on where you bought your first own apartment or property, the property tax differs by state or municipality. But how much property tax do I have to pay in the end? Learn everything about the cost of property tax here.

Why do I have to pay property tax?

The property tax generally taxes the property. In contrast to land transfer tax, which is only levied once when an apartment is purchased, property tax is levied up to four times a year. For tenants, the property tax does not mean any additional costs, because it is part of the operating costs that can be passed on to the tenant. The property tax is calculated on the basis of the area or value and the individual assessment rates of the municipalities. There are also two types of property tax.

Two types of property tax:

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  • Land tax “A”: land for agricultural and forestry use
  • Real estate tax “B”: Other developed and developable real estate

Property tax B: factors

Real estate, such as your first apartment that you bought as an investment, therefore always falls under the property tax B. However, the property tax does not have a specific value, but there are many factors that influence the property tax B, such as the assessment rate of each municipality, the state or the type of real estate.

Factors that influence the property tax are:

  • Survey according to real estate value (unit value = real estate value)
  • Individual assessment rate of the municipality
  • State
  • Real estate type

How is the property tax B calculated?

Fortunately, the property tax is easy to calculate. The unit value figure must always take into account the value of the land, which falls or falls depending on whether it is developed or undeveloped. The determined unit value is first multiplied by the uniform factor, the property tax rate, which in turn is multiplied by the municipal assessment rate.

Here is the formula of the calculation in brief:

Unit value x property tax rate x municipal assessment rate = property tax rate

Excursus Hebesatz: What is it?

The assessment rate for calculating the property tax is determined by each municipality itself and thus varies throughout the country. It ranges from 0% to 1,050%.

Property tax rate: what is it?

The property tax rate applies to the whole of Germany, but a distinction is made between the old and the new federal states. The figure is often given not in % but in per mille, i.e. ‰.

Old federal states

Here in brief how the property tax rate is measured in the old federal states:

  • Single-family houses up to ~ 38,347 euros: 0.26%.
  • Single family houses above: 0,35
  • Semi-detached house: 0.31%
  • Other residential property: 0.35%

New federal states

Here are the measurements of the new federal states:

up to 25.000 > 25,000 to 1 million > 1 million
Old building without single family houses 1,0% 1,0% 1,0%
New construction without single-family houses 0,8% 0,7% 0,6%
Single-family houses old building up to 15,338.76 euros unit value 1,0% 0,8% 0,6%
exceeding amount 1,0% 1,0% 1,0%
Single-family houses new buildings up to 15,338.76 euros unit value 0,8% 0,6% 0,5%
exceeding amount 0,8% 0,7% 0,6%
undeveloped plot 1,0% 1,0% 0,6%

The next step: documents for the bank

You’ve found the perfect apartment? Great, now it’s down to the nitty-gritty – the financing, with the self-disclosure and all documents for the bank. Here, the completeness, neatness and seriousness is particularly important. What else you need for your financing and what you should pay attention to, you can find out here!