Checking a Developer Contract: What to Look for Before the Notary Appointment

Kevin Celentano · 2026-10-13

You have reserved a new-build apartment. The notary sends a 40-page draft contract, along with a building specification and a payment plan. The appointment is in two weeks. And you wonder what parts you actually need to read.

The short answer is: four places. The payment plan, the completion date, the building specification, and the rules for handover. It is at these points that it is decided whether you only pay for what has been built, and whether a delay costs the developer something or just you.

We will go through these points in order and use an example to calculate what the construction period costs. At the end, there is a checklist for the appointment.

01What a property developer contract is

When buying an existing apartment, you are buying something that already stands. With a developer, you are buying a promise. The developer commits to building the apartment and providing you with ownership of the land share. The law calls this a property developer contract (§ 650u BGB).

For the construction, contract-for-work law applies; for the land share, sales law applies. This has practical consequences. You take delivery of the apartment like a client, and your claims for construction defects only expire five years after handover (§ 634a Para. 1 No. 2 BGB). In contrast, with a used apartment, defect rights are usually excluded.

The contract must be notarised. If you are buying as a consumer, the notary should generally send you the draft two weeks before the appointment (§ 17 Para. 2a BeurkG). This time belongs to you. Use it for the four points below.

02"Do I have to pay before completion?" The MaBV payment plan

The Real Estate Broker and Property Developer Ordinance (MaBV) determines when money can flow. Before you pay the first instalment, four things must be fulfilled (§ 3 Para. 1 MaBV):

• The contract is effective, and the notary has confirmed this.
• A priority notice of conveyance is entered in the land registry for you.
• The release from encumbrances is secured. The developer's bank will therefore release your apartment from its land charge when you pay.
• Planning permission has been granted or construction start is officially permitted.

Thereafter, you pay in a maximum of seven instalments based on construction stages (§ 3 Para. 2 MaBV). The ordinance lists 13 construction stages, which are combined into seven instalments. A common plan looks like this:

Check in the draft whether the instalments follow these stages and whether no instalment is higher than the MaBV permits. If stages deviate, ask the notary why. The developer requests each instalment in writing, usually with confirmation from a site manager. You are entitled to check the construction status yourself or have it checked before you pay.

Instead of instalments, the developer can also provide a guarantee for all payments (§ 7 MaBV). Then they may accept money earlier. For you, this is only as good as the bank providing the guarantee. Ask to see the guarantee before you pay.

03"Is the completion date fixed?"

The law requires the contract to provide binding information regarding the time of completion or the duration of construction (§ 650k Para. 3 BGB). If it is missing, the information from the building specification applies. What exactly is in the contract makes a big difference.

Without a contractual penalty, you must prove your damage, such as lost rent and additional interest. This is possible but takes time and often a solicitor. Distinguish between readiness for occupancy and complete completion. The apartment is ready for occupancy when your tenant can move in. The house is only finished with outdoor facilities and final work.

04Building specification, special requests, and handover

The building specification

What is not in the building specification, the developer does not owe. It must be available to you before the contract (§ 650j BGB) and becomes part of the contract. If it is unclear, doubts are to the detriment of the developer (§ 650k Para. 2 BGB). You should not rely on that.

For a let apartment, pay particular attention to points that determine your rent and costs:

• Living area and calculation method. Does it say "according to the Living Space Ordinance"? How are the balcony and terrace credited? The rent depends on the area.
• Heating and energy standard. Which heating, which efficiency house standard? Service charges and, if applicable, subsidies depend on this.
• Equipment. Floor coverings, bathroom, kitchen yes or no, roller shutters, cellar room, parking space. Every gap will cost you money or rent later.
• Wording like "equivalent" or "at the developer's choice". They allow substitution. Ask what is owed at a minimum.

Special requests

Requests beyond the building specification should be agreed in writing, with price and impact on the deadline. Special requests are a common justification for delays. As a buy-to-let investor, ask yourself for every request whether a tenant would pay more for it.

The handover

With the handover, you declare that the apartment is essentially in accordance with the contract (§ 640 BGB). Thereafter, you must prove defects, and the five-year expiry period begins. Therefore, do not walk through the apartment alone. A building expert finds more in an hour than most buyers in a day.

For a condominium, there are two handovers. You take delivery of your apartment (separate property) yourself. The communal property, i.e., roof, facade, staircase, and technology, concerns all buyers. Check in the contract who takes delivery of it. Clauses according to which an expert selected by the developer takes delivery for you are viewed critically by courts. Ask the notary about this.

05Example calculation: what the construction period costs

Let's take Julia. She is 41, employed, single, and has a taxable income of €80,000. She buys a new-build apartment with 65sqm for €300,000 and finances the full purchase price. She pays the purchasing costs from savings. The name is fictitious, the numbers are a calculation example and not a forecast.

The instalments flow according to the plan above. The bank pays them out; Julia only pays interest during the construction phase, no repayment. For the part that the bank has committed to but not yet paid out, it charges commitment interest after six free months.

Before tax, Julia pays around €7,270 out of her own pocket in the first year, without a single euro of rent. The tax office contributes around €3,300 because the interest counts as professional expenses. By the time of handover after 18 months, interest and commitment interest in the example add up to around €12,540.

After handover, it doesn't automatically get easier. At €13/sqm, Julia gets €845 cold rent per month. This is offset by €900 interest, €375 repayment, and around €60 non-recoverable service charges. Before tax, around €490 are missing every month. Although repayment builds equity, it must come from her salary.

And if construction takes half a year longer?

A delay of six months costs Julia around €10,360. That's exactly why the difference between "expected" and "at the latest" in the contract is worth so much. Use the purchasing costs calculator to calculate what you need to have ready in addition to the purchase price.

What does your purchase cost in addition to the purchase price? Enter purchase price, federal state, and land charge, and you will see notary, land registry, and property transfer tax individually.

06Checklist before the notary appointment

Go through the list with the notary. They explain the contract neutrally but do not advise you one-sidedly. Anyone who wants a second opinion should have the draft checked by a construction law solicitor. This costs money, and for a six-figure purchase, it is well spent.

07For whom a new-build from a developer is suitable

08Risks: What can go wrong with a developer purchase

• Developer insolvency. Because you only pay according to construction progress and have a priority notice, there is a countervalue for your money. However, someone else has to finish building the rest, and that almost always costs more than the open instalments. Added to this are time and legal costs.
• Delay. As the example shows, half a year quickly costs a five-figure sum. Without a binding deadline, you bear this alone.
• Defects. New-builds have defects, even good ones. Without careful handover, you lose evidentiary advantages.
• Interest. Your loan already runs in the construction phase. If the fixed-interest period ends, follow-on financing can become more expensive. Plan for a sufficiently long fixed-interest period.
• Letting. After handover, a tenant must be found. Expect vacancies of a few months if many apartments in the same building are finished at the same time.
• Maintenance and resale. Even a new-build needs a reserve. Anyone who sells early competes with newer projects.

09Further reading

• Process for purchasing a property
• New-build or existing property as an investment
• Check purchase agreement for a condominium
• MaBV payment plan in the glossary
• Property developer contract in the glossary
• Commitment interest in the glossary

10Sources

All sources retrieved on 13/10/2026.

• § 650u BGB, § 650v BGB, § 650j BGB, § 650k BGB, § 650m BGB
• § 640 BGB (Handover), § 634a BGB (Statute of limitations)
• § 3 MaBV, § 7 MaBV
• § 17 BeurkG
• § 8 WEG (emerging community)
• § 9 EStG, § 32a EStG (2026 tariff), §§ 3, 4 SolZG
• All example calculations: own calculation, status 13/10/2026

Note: This guide is general information and does not replace tax or legal advice. All numbers are example calculations with disclosed assumptions, status 13/10/2026.