The different ways to co-own property (real estate) in Germany
Well, the legal concepts of “Miteigentum” and “Tenancy in Common” are quite similar, if not identical. The German Miteigentum (co-ownership) is regulated by the German Civil Code in sections 1008 to 1011. Each “Miteigentümer” has a direct, separately transferable interest in the property. However, where property is concerned, the rights of co-owners in Germany are usually individually defined in the notarial deeds and the German Land Registry (Grundbuch). In particular, the co-owners usually agree a right of first refusal (Vorkaufsrecht) or they even bind themselves in a way that no one can sell his/her share without the consent of the other co-owners. Thus, in order to really be certain about the rights and obligations that come with a property share in Germany, one must definitely inspect the Land Registry. The rights and obligations amongst the German Tenants in Common are regulated in section 741 ff German Civil Code, titled “Co-ownership by defined shares” (Gemeinschaft nach Bruchteilen). Very much simplified, the basic rule is: everything must be agreed by unanimous vote (section 744 BGB). This means that if the co-owners cannot agree whether (or to whom) the property shall be let or sold, whether it shall renovated (or by whom), then there is deadlock.
What happens if the co-owners of a German property cannot agree?
If all attempts to reach an amicable solution with the other co-owners has failed, the only way to break free for a tenant in common who is caught in such a situation, is to apply to the local German court (Amtsgericht) for a so called Teilungsversteigerung procedure (compulsory partition by public auction). This means that the entire property (not just one share) is then auctioned off through the court and the proceeds are divided between the co-owners according to the size of their shares. Each co-owner is allowed to participate in the auction. This Teilungsversteigerung should, of course, only be the means of last resort, because it triggers significant court fees, surveyor costs and stress. However, in practice, this happens fairly often in Germany, especially is the Miteigentümergeeinschaft has come into existence due to an inheritance. More on this Miterbengemeinschaft here.
More information on buying property in Germany, the German Land Registry, the German conveyancing process and the rights and duties of tenants and landlords in Germany is available in these posts:
Or simply click on the sections “Property” or “Conveyancing in Germany” in the right column of this blog.
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The law firm Graf & Partners and its German-English litigation department GP Chambers was established in 2003 and has many years of experience with British-German and US-German probate matters, including the representation of clients in contentious probate matters.
Bernhard Schmeilzl, LL.M. (Leicester) at +49 941 463 7070.please contact German solicitor