A Guide for Heirs to German real property in an estate: why title passes on registration rather than on death; what the land register requires; the notary whose involvement cannot be waived; the two-year window that avoids the registry fee; and the taxes that do and do not arise.
German land is the part of an estate least amenable to American habits. There is no escrow, no title insurance and no personal representative whose signature moves the asset. The land register does the work that title insurance does in the United States, and it does it by being constitutive.
An heir owns inherited German land from the date of death. What the heir cannot do is deal with it, because until the register is corrected the register says somebody else owns it, and a good faith purchaser is entitled to rely on what the register says.
The mistake this page exists to prevent is treating the German property as something to attend to once the American administration is finished. Registration within two years of the death is free of the registry fee, and registration requires a certificate of inheritance or a notarial will, which itself takes months to obtain from abroad. The sequence has to start early or the saving is lost and the delay compounds.
The second point is that nothing about German land can be done informally. Every disposal requires a notarial deed, the notary acts for the transaction rather than for either party, and a power of attorney used in place of personal attendance must be notarially certified.
(1) Title to German land passes on registration in the Grundbuch, not on death, so an inherited property cannot be dealt with until the register is corrected.
(2) Correction requires a certificate of inheritance or a notarial will with the court record of its opening.
(3) Registration applied for within two years of the death is free of the registry fee.
(4) Every disposal of German land requires a notarial deed. The Auflassung is the agreement declared before the notary, and the priority notice entered in the register protects a buyer between contract and registration.
(5) German real estate transfer tax is not charged on an acquisition by inheritance or by gift, nor on a division of the estate among co-heirs, but it is charged where one co-heir buys out another after division.
(6) German real property is German situs for inheritance tax whoever owns it and wherever that person lives, and it is valued under the German Valuation Act rather than at any American figure.
Part I. Why the register governs
The German land register is constitutive rather than evidential: ownership passes when the entry is made, and the register is conclusive in favour of a purchaser acting in good faith. That is why there is no German equivalent of title insurance. The register performs the function, and the state stands behind it.
For an heir the consequence is procedural. Ownership arises at death, but the register still names the deceased, and no bank, buyer or notary will act on the strength of a death certificate alone. Correcting the register requires a certificate of inheritance or a notarial will together with the probate court’s record of its opening, which is the same documentary bottleneck that governs the rest of a German estate.
Part II. The notary, and what cannot be done remotely
Every disposal of German land requires a notarial deed. The Auflassung is the agreement of transferor and transferee on the passing of ownership, declared before the notary, and the Auflassungsvormerkung is the priority notice entered in the register to protect a buyer between contract and registration. Neither has an American counterpart, because in the United States escrow and title insurance do that work.
The notary is a public officer who acts for the transaction rather than for either side, reads the deed aloud and advises both parties. An heir in the United States who cannot attend must act through a power of attorney, and for dealings with land that power must be notarially certified and, if executed abroad, apostilled. This is not a formality that can be dispensed with by agreement.
Part III. Which taxes arise, and which do not
German real estate transfer tax, charged by the Land at between 3.5 and 6.5 per cent of the consideration, is not charged on an acquisition by inheritance or by gift, and is not charged on a division of an estate among co-heirs. It is charged where one co-heir buys out another after the estate has been divided, and it can be triggered by transfers of shares in companies that hold German land, which is a trap in structures built for American estate tax purposes.
German inheritance tax does reach the property, because German real estate is German situs whoever owns it and wherever that owner lives. The figure brought into charge is the German valuation, not the American appraisal.
| Event | German real estate transfer tax | German inheritance or gift tax |
|---|---|---|
| Acquisition on death | Not charged | Charged; German situs in all cases |
| Gift of German land | Not charged | Charged |
| Division of the estate among co-heirs | Not charged | Already charged on the acquisition |
| One co-heir buying out another after division | Charged on the consideration | Not a further acquisition |
| Sale to a third party | Charged on the consideration, payable by the buyer in practice | Not applicable; income tax may arise on the gain |
Part IV. Practical steps
- Start the certificate of inheritance immediately. Registration depends on it, and obtaining it from the United States takes months. The two-year fee-free window runs from the death, not from the grant.
- Obtain the land register extract before deciding anything. It identifies the registered owner, the charges on the property and any priority notices, and it is the document a German notary will work from.
- Settle whether the property is being kept, divided or sold. A division among co-heirs attracts no transfer tax, while a buy-out after division does. The order of the steps changes the tax.
- Execute any power of attorney in notarially certified form. An uncertified power is of no use for land, and one executed in the United States needs an apostille.
- Obtain a German valuation rather than relying on an American appraisal. The German Valuation Act decides what the property is worth for inheritance tax, and since 2023 the methods bring German property into charge at materially higher figures than before.
Conclusion
German land is moved by the register and the notary, not by the executor, so the work that matters in an estate with American heirs is documentary and it is sequential. The certificate of inheritance governs the timetable, the two-year registration window rewards starting early, and the order in which co-heirs divide or buy out one another decides whether transfer tax arises at all.
Sections 873, 883, 892 and 925 of the German Civil Code (transfer of land, priority notice, public faith of the register and the Auflassung); section 29 of the Land Register Code (form of evidence); item 14110 of the schedule to the Court and Notary Costs Act (fee-free registration within two years); section 3 numbers 2 and 3 of the Real Estate Transfer Tax Act (acquisitions on death and by gift, and division of an estate); sections 121 and following of the Valuation Act, and the valuation amendments made by the Annual Tax Act 2022 with effect from 1 January 2023; section 13d ErbStG (let residential property). Statuses are stated as of September 2026.
- 13 October 2026: page created.
- Real estate in Germany
- Grundbuch, the German land register
- Auflassung and the priority notice
- The German notary
- Grunderwerbsteuer, the real estate transfer tax
- Unbedenklichkeitsbescheinigung, the tax clearance
- Erbengemeinschaft, the community of heirs
- Familienheim, the family home exemption
- How German property is valued for inheritance and gift tax
- The German family home exemption and the American heir
- German property income and the American owner
- The German certificate of inheritance for heirs living in the United States
Contact
An heir in the United States who has inherited German land faces a registration problem before a tax one. Ashford International Law PC advises families and their advisers on obtaining the certificate of inheritance required for registration; instructing and working with the German notary; correcting the land register within the fee-free period; advising on division, buy-out and sale, and the transfer tax consequences of each; obtaining the German valuation and filing the inheritance tax return, alongside the family’s existing advisers or leading the United States side end to end.
The firm is led by attorney Caroline Esche Ashford, PhD, JD. A graduate of Columbia University Law School, her practice focuses on international estate planning and the cross-border taxation and administration of estates and trusts, including German real property in estates with heirs resident in the United States. Dr. Ashford is also licensed to practice law in Germany. She advises in French and German as well as English.
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This guide is intended for general educational purposes and does not constitute legal or tax advice, nor does it create an attorney-client relationship. The matters described, the German land register, the Auflassung and priority notice, the notarial form requirement, German real estate transfer tax and the valuation of German property for inheritance tax, depend on the specific facts, assets, countries and states concerned and on the law in effect at the relevant time, and they change. Statuses and figures are stated as of September 2026 and must be confirmed before any decision. Nothing here is advice on any particular estate or transaction. A family in this situation should obtain advice from qualified counsel in each relevant country promptly, and before any German property is sold or divided.
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