Apartment Ownership and Partial Ownership
Terminology Definitions
The owner of a property is automatically the owner of the house standing on it. If spouses are each ½-share, co-owners of a property with a four-story apartment building on it, each spouse does not own two floors each, but rather all four floors are owned together in proportional fraction of the ownership shares.
The Housing Property Act (WEG) however allows the ownership of a property to be divided in such a way, that a co-owner of the property, becomes the sole owner of an apartment. Here, it is even possible, in addition to the apartment itself, for a cellar room, an underground parking space and the balcony to be listed as sole ownership. It is then a matter of so-called special ownership. In contrast, the shared premises (stairway, heater room, attic, etc.) remain common property owned by all co-owners.
The division into ownership of residential apartments requires a notarized declaration of division that is entered into the land title register. The partition declaration is accompanied by copies of the construction plans, in which the exact division is drawn, namely, which rooms become separate special property and thus sole property, and which parts of the building remain as common property. During the division, it must be ensured that the apartment itself is self-contained, or rather that it possesses its own access from the community property. This is verified by the building authorities with a so-called certificate of separation. You should obtain this certificate, which your notary and, if applicable, your architect can help you apply for, prior to notarization of the declaration of division. Generally, the building authorities (district office) require 3 to 4 weeks for the issuance.
Another component of the notarial certification, in which ownership of residential apartments is established, is the so-called community regulations declaration, in which special arrangements are made for the community of co-owners. It clarifies how the costs for the maintenance, management, electricity, heating, water, insurance, etc. are divided and who should be responsible for repairs. In addition, the course of the property owners’ meeting and voting rights are further regulated.
As an apartment owner, one is only partially “his own master”: The owner’s meeting can usually make decisions based on a simple majority, which can then regulate the building’s rules and can also bring about a financial burden to the individual co-owners. The buyer of an apartment should therefore, prior to contract signature, carefully review the declaration of partition and all resolutions of the owners' meetings, which as of late must be recorded in the so-called archive of resolutions. They are binding for him!
In the usually annually occurring apartment owners’ meeting, the apartment owners rule on all matters of the community building, in particular about:
- The amount of the residential or housing allowance,
- The economic plan for the following year
- The housing regulations (periods of rest, usage of the garden, etc.)
- The appointment of a property manager,
- The carrying out of major repairs, which may require special contributions to be agreed upon.
Especially for larger residential complexes, it is common and appropriate for the owners to appoint an administrator, who is responsible, in particular, for the maintenance, cleaning and insurance of the property as well as the convocation of the owners' meeting. For this purpose, each owner has to pay a monthly residential or housing allowance, from which the administrator meets the costs incurred, builds up reserve funds and also which contains the compensation for the administrative work.
Checklist Partitioning into Residential Ownership and Partial Ownership
For the partitioning of a property into ownership of residential apartments, a comprehensive meeting with the notary is required before the notarization. For this meeting, you should bring all of the plans (site plan, construction plans: floor plans, views, sectional plans) with you and clarify the following questions:
- Does a separation declaration exist?
- Which key is to be used for dividing the common community costs (for example: according to apartment size, by the number of apartments, by co-ownership shares, etc.)?
- What should the voting distribution of the owners look like?
- Should an administrator be assigned?
Costs Partitioning into Residential Ownership and Partial Ownership
Notary fees cannot be levied or negotiated at the will of the notary; they are strictly regulated by law. Decisive is the Court and Notary Fees Act that applies throughout federal territory. Therefore, the same fees are always charged by each notary for the same notarial activity.
The notarization fees are based on the so-called commercial value, and in the case of a declaration of division, therefore according to the value of the property including any existing or planned development. In the above-mentioned fees, the costs for consultation and draft creation as well as all changes to it are included. In addition, there are usually some additional small expenses for copies, postage and telephone as well as the statutory value-added tax. When dividing a property into residential ownership or partial ownership, the costs also depend on whether the division is made by a sole owner, or if the property already belongs to several owners.
In addition to this, there are administrative costs for the separation certificate that you need to submit to the building authorities. For additional information, please contact the building authorities responsible for the property.
