Location

Location - Location refers to the geographical location of a property-that is, the exact location of the parcel of land by municipality, cadastral district, cadastral section, and parcel number. In legal terminology, the term is used to determine the competent land registry office, the competent court, and the tax classification of a property. Location is the most important factor determining a property’s value.

Legal Significance

Location determines several areas of legal jurisdiction:

• Land Registry Office: The local court in whose district the property is located has jurisdiction. In Nuremberg, the Nuremberg Local Court and its associated land registry office have jurisdiction; for properties in the surrounding area, the respective local courts in Fürth, Erlangen, Lauf, or Schwabach have jurisdiction.
• Jurisdiction: For lawsuits concerning rights to a property-such as boundary disputes, easements, or claims for the return of property-the court at the location of the property has exclusive jurisdiction (Section 24 of the German Code of Civil Procedure (ZPO)-exclusive venue). This jurisdiction is mandatory and cannot be altered by contract.
• Real Estate Transfer Tax: Real estate transfer tax is levied by the tax office in whose district the property is located. In Bavaria, the tax rate is a uniform 3.5%, regardless of the buyer’s place of residence.
• Property Tax: The municipality where the property is located levies property tax-even if the owner resides in a different municipality. Since the 2022 property tax reform, Bavaria has been using its own calculation model.
• Inheritance and Gift Tax: Real estate is valued according to the Valuation Act at the location of the property and is subject to tax in Germany-even if the decedent or heir lives abroad.

Location as a Valuation Factor

In real estate valuation, location-colloquially referred to as the site-is the most important factor determining value. Appraisers distinguish between:

• Macro-location: Region, city, economic area-influenced by the labor market, population trends, infrastructure, purchasing power, and vacancy rates. The Nuremberg metropolitan region is considered a stable macro-location with a positive employment outlook thanks to companies such as Siemens, Bosch, Schaeffler, and the growing technology sector.
• Micro-location: neighborhood, street, immediate surroundings-determined by building structure, noise pollution (railway line, highway, commercial activity), local amenities, schools, kindergartens, public transportation connections (subway, tram), and recreational quality.

The standard land values set by the Appraisal Committee reflect the assessment of the location: Within Nuremberg, standard land values can vary from under 200 euros/m² in peripheral areas (Reichelsdorf-Süd, Katzwang) to over 1,000 euros/m² in premium locations (Erlenstegen, parts of Wöhrder See).

Location as Hidden Appreciation Potential

Changes in a neighborhood’s character alter property values over time. In Nuremberg, districts such as the Gänsbergviertel, parts of Gostenhof, and the Südstadt have significantly increased in value in recent years-thanks to investments in public spaces, new restaurants, co-working spaces, and cultural institutions. Those who invest early in up-and-coming locations can benefit from neighborhood developments that increase property values far beyond general market trends. We continuously monitor the development of Nuremberg’s various neighborhoods and, upon request, advise our clients on locations with particular growth potential.

Practical Tip for Property Owners in Nuremberg and Franconia

We recommend that sellers in the Nuremberg metropolitan region describe the location of their property in the listing not merely as an address, but as location quality: distance to the subway station, walking time to the Old Town or the main train station, school districts, local recreational areas (City Park, Pegnitz River, Wöhrder Lake), and the neighborhood’s development prospects. In Nuremberg, even small differences in location lead to significant price differences-a property in Erlenstegen commands three times the standard land value of a similarly sized property in Langwasser. A professional location description in the property listing can significantly improve the speed of the sale.

Frequently Asked Questions

How do I find the exact location of my property?

The exact location is determined by the land registry extract and the real estate cadastre: municipality, cadastral district, parcel, and parcel number. You can obtain the land register extract from the relevant local court or a notary. An extract from the real estate cadastre-i.e., the parcel map-is available from the cadastral office (in Nuremberg, the Office for Geoinformation and Land Use Planning). Alternatively, you can determine and view the parcel number online via the Bavarian Geoportal (geoportal.bayern.de).

Does the location affect the financing terms?

Yes, banks assess real estate based on location-properties in sought-after areas with stable or rising standard land values generally receive higher loan-to-value ratios and thus more favorable interest rates. In prime locations in Nuremberg, the mortgage lending value is often only 10% below the purchase price; in outlying areas or structurally weak regions, discounts of 20-30% are common. Banks assess properties in regions with declining populations with particular caution-financing there is more expensive or harder to obtain.

What does the “location principle” mean in tax law?

The location principle states that income from real estate (rents, capital gains) is taxed in the country where the property is located-regardless of the owner’s place of residence. German tax law applies to real estate located in Germany, even if the owner lives in Switzerland, Austria, or a third country. Double taxation agreements (DTAs) govern how the tax is divided among the countries involved. Foreign owners of German real estate are subject to limited tax liability in Germany.

How do infrastructure projects affect the quality of a property’s location?

New infrastructure projects can significantly improve or worsen a property’s location quality. A new subway station or the expansion of a tram line increases a neighborhood’s public transportation connectivity, thereby improving the micro-location for nearby residential and commercial properties. Conversely, the construction of a bypass or a logistics center can increase noise pollution and reduce the quality of life. Several projects are currently underway in Nuremberg that will influence the location quality of entire neighborhoods: the expansion of the subway network, the development of the rail yard area, and the redesign of the southern city entrance. Anyone investing in up-and-coming Nuremberg locations today should factor in planned infrastructure development as part of their location analysis.

Location in Digital Marketing

In modern real estate marketing, location is no longer communicated merely as an address but as a multidimensional description of the area. Professional property listings use interactive maps, isochrone analyses (which destinations can be reached in x minutes on foot, by bike, or via public transit?), and location evaluations based on standardized criteria. For sellers in the Nuremberg metropolitan region, this means: The description of the location in the property brochure should explicitly highlight the area’s strengths-school district, access to parks, distance to the nearest subway station, proximity to local recreational areas such as the City Park or Lake Wöhrder. A professional location description can positively influence potential buyers’ perception of the property and shorten the time it takes to sell.

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