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Buying New Construction (Bauträger): Payment Schedule and Security
Buying off-plan means paying in installments. Learn about the 'MaBV' regulation that protects your money if the developer goes bankrupt before finishing the house.
Table of Contents
Buying a property that hasn't been built yet (off-plan) is popular because you get a modern, energy-efficient home tailored to your taste. However, you don't pay the purchase price all at once. Instead, you pay according to the progress of construction, regulated by the 'Makler- und Bauträgerverordnung' (MaBV).
1. The 7 Payment Installments
Under German law, the developer can only ask for money when specific milestones are reached. For example: 30% after the groundworks began, 28% after the structural shell (Rohbau) is finished, and so on. You retain the final 5% until the property is fully handed over without defects.
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2. Insolvency Protection
The biggest risk is the developer going bust. Therefore, the MaBV usually requires the developer to pay effectively for a guarantee or insurance. Never transfer money directly to a developer's private account without a notary's clearance.
