Key Points at a Glance
- The declaration of division is the essential prerequisite for establishing residential or partial ownership (condominium ownership) in a property.
- If individual units are to be sold, the property must first be divided accordingly; only then can ownership of the individual units be transferred.
- The declaration of division is usually notarised so that a purchase agreement for an individual unit can validly refer to it.
What Is a Declaration of Division?
A Declaration of Division is the formal declaration submitted to the land registry to divide a property in such a way that each co-ownership share is linked to a defined unit of separate ownership.
For example, a property with a building containing four apartments is, by default, owned entirely by the property owner. Through a Declaration of Division, the property can be legally divided into four separate ownership units. Each ownership share of the property is then linked to the exclusive ownership of one apartment (separate ownership).
- Legal division: The Declaration of Division does not transfer ownership to another person. However, if individual units (e.g., apartments) are to be sold separately, the division creates the legal basis required for the transfer of ownership.
- Separate ownership: Separate ownership refers to the exclusive ownership of individual parts of a building. A condominium owner, for example, holds separate ownership of their apartment, which legally belongs to them alone.
- Common property: In addition to separate ownership, certain parts of the building remain jointly owned by all owners. These include structural components essential to the building and areas intended for shared use. Examples include staircases, the façade, elevators, the heating system, and communal gardens.
Prerequisites for Establishing Separate Ownership
A Declaration of Division is an essential step in establishing separate ownership, typically used when newly constructed apartments are to be sold to individual buyers.
The creation of separate ownership requires the following:
- Building: Separate ownership may only be established for self-contained rooms located within an existing or planned building. In practice, this means there must be—or will be—a building with multiple individual units (typically apartments).
- Declaration of Division: The property owner must issue the declaration dividing the property. If multiple persons already own the property jointly, separate ownership may also be created by a division agreement between the co-owners.
- Registration in the land register: The owner must file an application for registration. In the case of multiple co-owners, all must submit the application.
- Consents: In certain cases, third-party consent may be required. If rights or priority notices are recorded in the land register that do not continue on all new separate units, the rights holders must consent.
- Government approvals: In some regions, establishing separate ownership requires public approval—for example, in areas subject to milieu protection ordinances or in tight housing markets under § 250 BauGB.
Content of the Declaration and Application to the Authorities
In the Declaration of Division, the property owner declares to the land registry that the property shall be divided into separate ownership. The declaration itself is typically straightforward, stating that the property is divided into co-ownership shares and that each share is linked to a defined separate unit.
Two documents are particularly important:
- Partition plan: The partition plan outlines the physical division of the property and its units. It is a detailed representation of the size and location of both separate and common property. In simplified terms, it shows which owner will have exclusive ownership of which areas.
The partition plan must be signed by the building authority. - Certificate of completion/separation: This certificate, issued by the building authority, confirms that the units satisfy the requirements of § 3 (3) WEG.
Separate ownership may only be created for units that are structurally self-contained.
What Is the Community Rules?
The community rules govern the rights and obligations among co-owners as well as the management of common property (e.g., rules on cost allocations, voting rights, and administrative matters). These rules may be incorporated into the content of separate ownership, provided they are legally valid. If no valid community rules exist, the statutory provisions of the German Condominium Act (WEG) apply.
Can the Declaration of Division Be Amended?
Before the homeowners’ association is formed, the declaration may be amended without restriction.
The association is deemed to exist once individual units are sold to third parties. After sales have occurred, unilateral amendments are no longer possible. Any changes to the declaration require the consent of all affected owners.
General Information on the Declaration of Division
In the context of establishing separate ownership (condominium ownership) in real property, the declaration of division plays a central role. The following aspects are of particular importance for the declaration of division:
- Duration: The division process typically takes only a few weeks. Once registered, the division is generally permanent.
- Form: The declaration itself does not require a specific form. However, filing with the land registry requires a publicly certified signature (§ 29 (1) GBO).
In practice, the declaration is usually notarised so that it can be referenced in future purchase agreements. - Costs: Costs are based on the property's value and are set by law. Notarisation of the Declaration of Division typically incurs a 1.0 fee. For example, for a property valued at EUR 1,000,000, notarial fees amount to approx. EUR 2,000 (net). Land registry fees apply additionally and are generally similar in amount.
