On March 20, 2024, the National Council decided to temporarily waive land registration fees when purchasing a home under certain circumstances. This can save up to EUR 11,500.00 in total. This is intended to promote the purchase of owner-occupied homes and boost the economy.
When buying a property, there are some additional costs on top of the agreed purchase price, such as the registration fees in the land register. To be entered in the land register as the owner, a fee of 1.1% of the purchase price (or the consideration) is charged as the basis of assessment. Due to the amendment to the Court Fees Act, which comes into force on April 1, 2024, purchasers can be exempted from the fee under certain conditions.
The exemption is subject to the following conditions: The purchaser must establish their main residence in the residence in question. This requirement corresponds to the satisfaction of an urgent residential need. Moreover, only natural persons can justify this, which is why legal entities cannot make use of this regulation. Proof of such a residential need can then be provided at the same time as the entry in the land register. In addition to the main residence notification, proof of the abandonment of the residence that previously served the urgent need for housing is also required. However, the proof can also be submitted up to 3 months after the purchase of the property or its completion (in the case of construction projects).
The exemption applies up to an amount of EUR 500,000.00. If the purchase price exceeds this amount, the EUR 500,000.00 still counts as an exemption amount. This means that the first EUR 500,000.00 is exempt in any case and fees only apply to the purchase price in excess of this amount. The limit of the exemption is a total purchase price of EUR 2 million. If the purchase price exceeds this amount, there is no exemption at all.
Purchasers are also spared the registration fee of 1.2% of the pledge amount for the registration of liens. The basic condition is that purchasers are also subject to the exemption from registration of the ownership right. The loan may be taken out exclusively or at least for more than 90% for the purchase of the property, its construction or renovation.
The regulations apply to property purchases from April 1, 2024. For technical reasons, entries in the land register can be applied for from June 30, 2024. This means that if the exemption is claimed, the contract cannot be entered in the land register until July. As a rule, no purchase price can be paid out until then because the registration of the title is usually a prerequisite for payment. Whether the premature entry of a ranking order or the priority notice of the ownership right will subsequently be regarded as detrimental to the exemption from fees is currently still completely unclear.
The exemption will cease to apply retroactively if – within five years – the urgent need for housing ceases to exist or the right of ownership to the residence in question is relinquished. This is intended to avoid workarounds.
The measure is initially limited until 30.06.2026.