Caution! Liability for defects
Mold in the basement and a roof that's long overdue for replacement – anyone wanting to sell their property knows that such defects significantly lower the selling price. But beware! Concealing this can lead to expensive consequences.
In Germany, real estate sellers are subject to liability for defects. Section 433, paragraph 1 of the German Civil Code (BGB) states: "The seller must provide the buyer with the property free from material and legal defects." A material defect is, for example, a leaky roof or other defects in the building structure. A legal defect exists if the rights of third parties render the property uninhabitable for the buyer, for example, if Aunt Erna has a usufruct right to the property.
These legal consequences are looming
For defects in the property that the seller has concealed, the buyer is entitled to subsequent performance according to § 437 No. 1 of the German Civil Code (BGB). This applies, for example, if the seller hides defects in the building structure. According to § 439 BGB, theoretically an equivalent item can be provided as a replacement – however, this is hardly feasible in the case of real estate. If the seller cannot provide a replacement or subsequent performance, the buyer can withdraw from the purchase agreement (§ 440 BGB) or reduce the purchase price (§ 441 BGB).
This regulation does not apply to visible damage such as a large hole in the floor. The law assumes that the buyer noticed this obvious defect during the viewing and purchased the property with this knowledge. However, an exception would be if the seller guaranteed that, for example, the property could be used immediately. Since this is unlikely to be the case with a large hole in the floor, the seller must provide compensation.
Protect yourself from liability for defects
Property sellers are not always aware of defects in their property and sometimes intentionally conceal them. So how can one protect oneself from liability for defects? Certain clauses in the purchase agreement can release sellers from liability for defects that arise after the contract is signed. However, this only applies to defects that were unknown to both parties before the contract was concluded. If an expert has alerted the seller to the defects before the sale, this can be proven in a potential legal dispute.
The better solution is to have the property professionally appraised by a real estate expert. This way, property sellers not only know how much their property is worth, but also receive an overview of any defects in the house, which can then be included in the purchase agreement. Additionally, it provides an excellent basis for negotiation. If potential buyers try to lower the purchase price by pointing to defects, the seller can always argue that these defects have already been factored into the asking price.
Do you need a professional appraisal for the sale of your property, or are you unsure about the wording in the purchase agreement? Contact us! We'd be happy to advise you.
No results found:
https://www.anwalt.de/rechtstipps/augen-auf-beim-immobilienkauf-was-ist-zu-beachten_184252.html
https://www.juraforum.de/lexikon/maengelhaftung
Notes
For the sake of readability, this text uses the generic masculine form. Female and other gender identities are explicitly included where relevant to the statement.
Legal notice: This article does not constitute tax or legal advice for any specific case. Please consult a lawyer and/or tax advisor to clarify the facts of your individual situation.
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About the author
Harry Mohr
Real estate agent (Chamber of Industry and Commerce)Harry Mohr, author of this article
