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Coronavirus effects on the property market – FAQ for Germany

The measures being taken to stop the spread of the coronavirus are having a huge economic impact across many industries. Here’s a list of frequently asked questions that will help you understand how the coronavirus is affecting the property market in Germany.

Can I move house during the Corona pandemic?

Moving house during the coronavirus pandemic is still allowed in Germany, but only with professional help. Friends and family are only allowed to help with moving if they are members of your household. Removal companies are still allowed to work. Right now they are experiencing high demand from private households. To be on the safe side, get in touch with as many removal companies as possible. That’ll give you the best chance of finding professional help for your desired date. It is strongly recommended to ask your local municipality whether there are any special restrictions.

Can I still visit a property?

If there is no curfew in your municipality, visits can still take place. We recommend that all housing providers arrange individual appointments or, even better, video tours. Also, no physical documents should be distributed.

Does it make sense to buy a property at the moment?

There are pros and cons to buying a house during an economic downturn. So far prices have not been significantly affected. Unfortunately, nobody knows how the future will look, so it’s a bit of a waltzing game.

Can I still build a house now?

Building a house is still possible. Most construction companies are operating and also accepting new orders. In fact, with all the spare time, it’s a good idea to start planning. You could, for example, browse some house catalogues. House suppliers generally send these out free of charge. You can also find out about financing your home project and take advantage of online consultations. Check out our article on getting a mortgage.

Do I still need to pay my mortgage?

The German government passed a new law on 27th March which states that anybody that has closed a mortgage before 15th March 2020 has the right to pause their monthly mortgage payments due from 1 April 2020 and 30 June 2020. The borrower must prove that the pandemic directly caused a reduction of income. For more information, we recommend you read this article from Hypofriend, a digital mortgage broker in Berlin.

What happens if tenants cannot pay their rent now?

Rent payment due from April 1 to June 30, including service charges, can be deferred. The missed payments must be made by 30th June 2022. Otherwise, the landlord is entitled to terminate the lease without notice at this point in time. In addition, interest on arrears may be incurred. In any case, the landlord should be informed in good time.

However, tenants are protected against contract termination if they can prove the effects of the pandemic are the cause of payment difficulties. This is also necessary for later legal disputes. This can be proved with an affidavit, an application for or granting of public aid, or proof of loss of earnings.

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