What Does Owning a Home in Germany Cost per Month?

In short

The bank's monthly payment is only part of it. On top come running costs (property tax, insurance, water, trash, energy) and a reserve for repairs. And not all of it is gone: the principal leaves your account but builds equity. What actually costs you money is interest and running costs. Separating the two shows what your home really costs each month.

Telling costs from equity

Item	Leaves your account	Is it a cost?
Mortgage interest	yes	yes
Running costs	yes	yes
Principal	yes	no, it builds equity
Reserve	only if you set it aside	provision for future repairs

That's why "payment versus rent" is a lopsided comparison: the payment includes principal, which is saving. Rent doesn't, but it does include upkeep, which the landlord pays.

The payment: interest and principal

With a standard German annuity loan, the monthly payment stays the same during the fixed-rate period (Zinsbindung). At first the interest share is high; with every payment it shrinks and the principal share grows.

Example: €300,000 loan, 3.5% interest, 2% initial repayment.

Payment: €300,000 × (3.5% + 2%) ÷ 12 = €1,375 a month
Of the first payment: €875 interest and €500 principal
Balance after ten years: about €228,300

Worked example, not financial advice. Interest rates change constantly.

Running costs

What comes on top depends heavily on the municipality, the house and your usage. Typical items for an owner-occupied house in Germany:

Property tax (Grundsteuer), since 2025 based on the new assessed values, usually due quarterly
Building insurance (Wohngebäudeversicherung), often yearly
Water and sewage, trash collection, possibly street cleaning
Chimney sweep with oil, gas or a fireplace
Heating and electricity, usually as monthly installments
Internet, the broadcasting fee and other contracts

Many items aren't charged monthly but quarterly or yearly. To compare them, convert them to a monthly amount: €480 of property tax a year is €40 a month.

With a condo, many of these items are part of the Hausgeld, paid monthly to the building management, including a share of the shared reserve.

Reserve: the Peters formula

Roof, heating, windows: at some point it gets expensive. A common rule of thumb in Germany for the reserve is the Peters formula (Petersche Formel). It assumes a building needs about 1.5 times its construction cost in maintenance over 80 years:

Reserve per year = construction cost per m² × 1.5 ÷ 80 × living area
Example: €2,500/m² construction cost, 130 m² living area: 2,500 × 1.5 ÷ 80 × 130 = about €6,100 a year, just over €500 a month.

That looks high, and in the first years after construction less is usually needed. Bigger bills come later, all at once. If you don't set aside the full amount, at least know how big the gap is.

When the fixed rate ends

After the fixed-rate period, often ten or fifteen years, the remaining balance needs refinancing at the rate of the day. In the example above about €228,300 is still owed after ten years. What the new rate means for monthly interest:

New rate	Interest in first month	Payment at 2% repayment
3%	€571	€951
4%	€761	€1,141
5%	€951	€1,332

Here, one percentage point more costs about €190 a month. Knowing when your fixed rate ends and what the balance will be lets you compare offers in time and plan extra repayments.

Repairs and the tradesman tax credit

For tradesman work on an owner-occupied home in Germany there's a tax reduction under Section 35a of the Income Tax Act: for 2026, 20% of the labor cost, up to €1,200 a year. Only labor, machine and travel costs count, not materials, and the bill must be paid by bank transfer, not cash. A reduction for 2027 is under discussion; the law in force applies.

General information, not tax advice.

Keeping track

List every item with amount, frequency and next due date.
Add up costs (interest, running costs) and equity building (principal) separately.
Work out the cost per square meter per month to compare your home with renting.
Know when your fixed rate ends and what you'll owe on that day.
Keep repair invoices, for the tax credit and an overview over the years.

As of October 23, 2026. All figures are worked examples.

The matching app

One number for your home: Heimblick

Heimblick does exactly this split: what your home costs you each month and what actually leaves your account including principal. All running costs with a debit calendar, plus mortgage, reserve and deadlines. Built for owner-occupied homes in Germany, for iPhone and iPad.

Running costs with frequency and due date, converted to monthly
With Heimblick Plus: amortization schedule with balance curve and end of the fixed rate
Reserve recommendation by the Peters formula
Repairs with receipts and a guide value for the tradesman tax credit

More about Heimblick

Frequently asked questions

What does a house in Germany cost per month besides the mortgage payment?

Running costs such as property tax, building insurance, water, sewage, trash, chimney sweep, heating and electricity, plus a reserve for repairs. The amounts depend heavily on the municipality, the house and your usage.

Is the principal repayment a cost?

No. It leaves your account every month, but it reduces the debt and builds equity. The costs are interest and running costs.

How big should a home maintenance reserve be?

A common rule of thumb in Germany is the Peters formula: construction cost per square meter × 1.5 ÷ 80 × living area gives the reserve per year. At €2,500/m² and 130 m² that's about €6,100 a year.

How is the monthly payment of an annuity loan calculated?

Loan amount × (interest rate + initial repayment rate) ÷ 12. At €300,000, 3.5% interest and 2% repayment that's €1,375 a month, of which €875 is interest and €500 principal in the first payment.

How much is the tradesman tax credit in Germany?

For 2026, under Section 35a of the Income Tax Act, 20% of the labor cost, up to €1,200 off your tax a year. Materials don't count and the bill must be paid by transfer. A reduction for 2027 is under discussion.

What does a home cost per month?