I bought a house in Baden-Württemberg for 690,000 euros. Every month, before I buy a single grocery, I pay 3,766 euros just to keep it. Here is what it really takes to buy a house in Germany, and what mine really costs, line by line.
That is about 45,000 euros a year. I've lived in Germany for over twelve years, and in the video I walk through why most Germans rent, whether a foreigner can get a mortgage, how the buying process works, what the market looks like right now, and then my own bills with the real numbers. This post has the same story in written form, so you can come back to the figures.
Quick note: this is general information and my own experience. It is not financial, legal or tax advice, and I am not a mortgage broker. The numbers for my house are my situation only. Market figures are rounded and they change, so check the current ones with a bank or an adviser before you decide anything.
German mortgage calculator
Put in the price, your cash, your state and the interest rate. It shows the monthly payment, the buying costs, how much you still owe when the fixed period ends, and a rent versus buy comparison. It gives estimates, not a bank offer.
Open the calculator →Why most Germans rent
In the European Union, about 68 percent of people live in a home they own. In Germany it is about 47 percent, and depending on whether you count people or households, the figure lands somewhere between 44 and 47 percent. Germany is the only EU country where most people rent. Romania, for comparison, is at about 94 percent.
So a German who rents is not unlucky or poor. In a big city, renting is simply the normal way to live. Economists point to a few reasons. After the Second World War, Germany was short of money and needed housing fast, so it built a lot of rental housing, and rents stayed affordable for a long time. Tenants here have strong protection against eviction and sudden rent hikes. And buying is expensive: the Bundesbank points to the property transfer tax, and to the fact that owners who live in their own home cannot deduct their mortgage interest, unlike many homeowners in the United States. I compared renting here and in the US in this report.
My honest take, and this part is opinion: Germans did not skip homeownership because they don't care about it. Renting was safe, stable and legally protected for a long time, so there was less pressure to buy.
That is changing, because renting is getting harder too. But it means buying here is not the default. You are swimming a little against the current.
Can a foreigner buy a house in Germany?
Yes. There is no law that stops foreigners from buying property here. Your residence status does not decide whether you may buy. It decides whether a bank will lend you the money, and that is the hard part.
A German bank is not a government office. It makes its own rules, and it asks one question: will this person pay us back over the next twenty to thirty years? So it looks at four things.
Your income, and how stable your job is.
Your Schufa, Germany's credit record. If you have just arrived, you may have little or no history here, and your American credit score does not carry over.
Your Eigenkapital, the cash you put in yourself. The figures I see for what you may need range from 20 to 40 percent of the price, and banks do not all agree, which is why it pays to ask more than one.
Your residence status. A mortgage runs for decades and a permit does not. With a Niederlassungserlaubnis, a permanent residence permit, or a German passport, banks usually treat you much like a German. With a temporary permit, the bank looks at how many years are left and how likely it is to be renewed. Some will lend you less, some will want more cash, and some will say no.
A thin Schufa history does not make a loan impossible, but it makes the bank's job harder. And if you do not live in Germany at all, expect fewer banks and higher rates.
How a German mortgage works
You borrow a sum and pay a fixed amount every month, made of interest and repayment. The interest rate is locked in for a set time, usually ten, fifteen or twenty years. That is the Zinsbindung, the fixed interest period. When it ends, you either pay off what is left or take a new loan at whatever rates are then. That is the Anschlussfinanzierung.
Many loans let you pay extra once a year without a penalty, called a Sondertilgung, but the limit is written in your contract. And many buyers split their financing into several loans, for example a state development loan plus a bank loan. Mine is made of three, and you will see the numbers below.
The cash: the price is not the price
On top of the price come the Kaufnebenkosten, the buying costs. In Baden-Württemberg the property transfer tax, the Grunderwerbsteuer, is five percent. The notary and the land registry take roughly one and a half percent. And if a Makler, an estate agent, is involved, the buyer often pays about 3.57 percent.
Most banks expect you to pay these costs from your own cash, not borrow them.
The paperwork and the buying process
When you are ready, bring your passport and residence permit, your last few pay slips, your employment contract, your tax assessments, your bank statements, and your Schufa report. Many people use an independent mortgage broker, who can ask many banks at once instead of just one.
The process is more formal than many Americans expect:
Find the house, visit it and negotiate the price.
Get your financing confirmed by the bank.
Go to a Notar, a notary. The notary is neutral and drafts the contract for both sides. You should usually receive the draft at least two weeks before you sign.
Sign. The contract is read out loud, line by line, and then you both sign.
The notary registers your claim in the Grundbuch, the land register, and handles the transfer. You pay the purchase price once the notary confirms the conditions are met, and only then do you get the keys.
One more thing, especially for expats. A mortgage is a promise for decades. If you leave Germany, you still owe the money. And if you sell before the fixed interest period ends, the bank can charge a fee for ending the loan early, called a Vorfälligkeitsentschädigung. So before you buy, ask yourself honestly how long you plan to stay.
The order is simple. First, get your residence status as solid as you can. Second, save the cash, both the down payment and the buying costs. Third, talk to a few lenders before you fall in love with a house.
The market right now
After the boom that ended in 2022, prices fell. Now they are creeping up again. Destatis, the federal statistics office, says residential property prices rose about 3.2 percent in 2025, the first full year rise since 2022, and in the first quarter of 2026 they were 1.4 percent higher than a year earlier. This is not a crash and it is not a boom. It is a slow, expensive market.
Then there is income. One institute calculated that in 2022 a typical home cost almost 10.7 times the average annual gross wage. Since 2023 wages have grown faster than prices, so that has improved, but in Munich one study puts the figure at 11.6 years of income.
And Germany is not building enough. About 126,000 homes were approved in the first half of 2026, 15 percent more than a year earlier, but a permit is not a home. Completions this year are forecast at roughly 185,000 to 215,000, about half of the government's goal of 400,000. Estimates of the total shortage range from about 550,000 homes to more than a million, depending on who is counting. The government's Bau-Turbo, a reform to speed up building, is not expected to show real effects until 2027 or 2028.
That shortage hits renters too. Asking rents rose about three percent in the year to early 2026, and over ten years they rose by an average of 43 percent in the big cities and 69 percent in Berlin. The Mietpreisbremse, the rent brake that limits increases in tight markets, was extended to the end of 2029. So renting is not a cheap escape either.
Where you buy matters as much as what you buy. One analysis found that a comparable single family house in Bavaria costs roughly four times as much as in Thuringia, and in Salzgitter, one of the cheapest big markets, a home costs less than three times a typical annual income. The catch, in my view, is that cheaper regions often come with fewer jobs.
Help, and what an old house can cost
Germany does have cheaper state backed loans through the development bank KfW. One program supports families with children who build or buy a new, climate friendly home. Another, called Jung kauft Alt, helps with buying an older home that needs renovation, with income limits. Conditions changed in August 2026 and the money is limited, so check the current rules before you plan around it.
If you are looking at an older house, ask for the Energieausweis, the energy certificate, which rates the house from A plus to H. Under the building energy law, new owners can be required to do certain upgrades after buying, such as replacing very old heating boilers or insulating attic floors, usually within a couple of years. The rules for heating systems have changed again and again and may change with the heating law reform. An old house can be cheap to buy and expensive to own, so get a surveyor or an energy consultant to look before you sign, not after.
Where I land, and this is my opinion, not a forecast: buying right now is not a bargain and it is not a disaster. If you buy, buy because you want to live in that house for a long time, not because you expect to get rich quickly.
What my house really costs
I bought a detached house in Baden-Württemberg in 2023 for 690,000 euros. It is about 150 square metres, with three bedrooms, a terrace and a garden. That works out to about 4,600 euros per square metre, though that includes the land and the garden. Here is what I pay every month.
L-Bank is the state development bank of Baden-Württemberg. Multiply the total by twelve and it is about 45,194 euros a year, just for financing and basic utilities. That is about 124 euros every single day.
And that is before the costs that are not on that list: property tax (Grundsteuer), building insurance, repairs and maintenance, renovations, and all the other wonderful surprises that come with owning a house. A common rule of thumb is to set aside about one percent of the purchase price every year for upkeep, and more for an older house. On 690,000 euros that rule alone would be around 6,900 euros a year, or about 575 euros a month. That is a general rule of thumb, not my actual spending.
Is buying better than renting?
The honest answer is that it depends. When you pay rent, all of it is gone. When you pay a mortgage, part of the payment is repayment, which builds your ownership in the house, and part is interest, which is gone, just like rent. On top of that, the purchase tax, the agent and every repair are costs you do not get back. What you get in return is stability: your rent cannot be raised by the bank, and in a market with rising rents and few homes, that has real value.
My view, and again it is my opinion: the right question is not which one is cheaper. It is which one fits the next ten years of your life. If you might move countries, renting keeps you free. If you know where you want to be and you can afford the whole bill, buying can make sense. The mortgage calculator has a rent versus buy comparison, so you can test it with your own numbers.
Three mistakes I think buyers make most
This is my opinion, based on how the numbers work.
Falling in love with a house before the bank has said yes. A viewing feels like a decision, but the financing is the real decision.
Planning only for today's interest rate. Ignoring what happens when the fixed period ends is how a comfortable payment turns into a painful one.
Treating the purchase price as the whole cost. Between the buying costs, the upkeep and the monthly bills, the price is only the start.
Insurance built for expats in Germany
Owning a house adds insurance to your list on top of the loan. For health, liability, and other policies, Feather is the English-language insurance service I point expats toward, so you can compare and sign up without wrestling German paperwork or a commission-driven sales agent. I explain why liability cover matters in this report.
Check out Feather →The buyer's checklist
Get your residence status as strong as you can.
Save enough cash for the buying costs, roughly ten percent of the price in a state like Baden-Württemberg, plus the down payment.
Ask several banks or an independent broker, and compare.
Look at the fixed interest period, and plan for what happens when it ends, because the follow on loan can come at a very different rate.
Budget for the whole month, not just the loan: energy, water, insurance, tax and repairs.
Be honest about how long you will stay. Then run your own numbers in the free mortgage calculator before you talk to a bank.
That is buying a house in Germany, with real numbers. If you want more, the free guides cover investing and retirement for expats, and the calculators page has the other tools. Tell me in the comments on the video what you want me to break down next.
Disclosure: the Feather Insurance link in this article is an affiliate link. If you sign up through it, I may earn a commission, which helps support the channel. This is general information and my opinion, not tax, legal, financial or insurance advice. The figures about my house are my own situation, market figures are rounded and change, and your situation is your own, so check current numbers with a bank or an independent adviser before you decide anything.