Grundsteuer
Annual Property Tax. The recurring municipal property tax, fully reformed as of 2025 with new state-specific valuation models. Usually a few hundred euros per year for an apartment: and passable to tenants.
The 2025 reform replaced 1964/1935 values; municipalities set multipliers (Hebesätze), and several adjusted them again for 2025/26. Amounts vary by state model, location and size: check the current assessment (Grundsteuerbescheid) in due diligence.
As a recoverable operating cost, Grundsteuer passes to tenants via the Nebenkostenabrechnung in standard leases: it affects tenant affordability rather than your net yield, vacancy periods excepted.
Frequently asked questions
What is Grundsteuer B?
The ordinary annual property tax on developed and developable land, meaning apartments and houses. Grundsteuer A applies to agriculture and forestry, and since the reform municipalities may also levy Grundsteuer C on undeveloped building-ready plots.
How much is annual property tax on a German apartment?
Usually a few hundred euros per year, depending on the state model, location, size and the municipal multiplier. During due diligence, ask the seller for the current assessment notice rather than estimating.
What is the Hebesatz?
The percentage your municipality applies to the assessed tax base. It runs to several hundred percent depending on the municipality and is set annually by the local council.
Can property tax be passed on to tenants?
Yes. It is one of the passable operating costs under the Betriebskostenverordnung and moves to the tenant through the annual statement in standard leases.