Right of use

The right of use is the right of a person to use another person’s property-in real estate law, typically a parcel of land or a building-without being its owner. Rights of use can arise in various ways: through a contractual agreement, by law, or by court order. Rights of use that can be registered in the land register are called limited personal easements or real easements and are also binding on the respective owner.

Types of Rights of Use in Real Estate Law

There are various forms of rights of use that differ in scope and legal nature:

• Usufruct (§ 1030 BGB): The most comprehensive right of use-the usufructuary may use the property in its entirety and collect all proceeds (e.g., rental income). However, they are not the owner and cannot transfer or bequeath the right.
• Right of residence (Section 1093 BGB): Permits the personal use of a dwelling by the beneficiary and their family, but not rental to third parties. It expires upon the death of the beneficiary.
• Easement (§ 1018 BGB): A right granted for the benefit of a neighboring property-e.g., rights of way for utility lines, rights of passage, or rights to build over. Easements are property-specific and automatically transfer to the new owner upon a change of ownership.
• Limited personal servitude (Section 1090 BGB): Similar to an easement, but granted for the benefit of a specific person (not for the benefit of a property). Typical examples: utility rights for service providers, right of way for private individuals, parking space usage rights.
• Leasehold right (ErbbauRG): The right to erect and use a building on another person’s property-is entered in the land register as a separate right (leasehold register). Term is usually 60-99 years.
• Permanent right of residence (Section 31 WEG): The permanently secured right to use an apartment as living space without being the apartment owner. It is entered in the apartment land register.

Entry in the Land Register and Real Effect

Rights of use that are entered as limited personal servitudes or real servitudes have real effect-they bind not only the current owner but also every future owner. Anyone who purchases a property encumbered with a right of use automatically assumes this encumbrance.

Rights of use are listed in Section II of the land register (encumbrances and restrictions). Depending on their priority-i.e., the date of registration-multiple rights of use may encumber a single property simultaneously. In foreclosure proceedings, priority can determine which rights remain in effect.

Therefore, a careful review of the land register-particularly Sections II and III-is essential before any real estate purchase. Rights of use in Section II can significantly limit the usability and value of the property.

Depreciation Due to Rights of Use

A registered right of use reduces a property’s market value because it restricts its free availability. The reduction in value depends on the type, scope, and expected duration of the right:

• A lifetime right of residence for a 75-year-old person has a significantly lower deduction value than that of a 40-year-old person, as the statistical remaining useful life is shorter.
• A utility easement held by a utility company that affects only a small area and hardly restricts development potential results in a minor reduction in value.
• A right of way that ensures a neighbor’s access across the property can result in significant reductions in value, depending on the location and frequency of use.

When valuing such properties, it is advisable to consult a qualified appraiser.

Expiration and Redemption of Rights of Use

Rights of use generally expire due to:

• Death of the beneficiary (in the case of personal rights such as usufruct or right of residence)
• Expiration of an agreed-upon term
• Contractual termination with notarized authorization for cancellation
• Consolidation (when the owner and beneficiary are the same person)

Redemption of rights of use in exchange for compensation is possible, but only with the consent of the beneficiary. Therefore, existing rights of use should be addressed early on in the process of selling a property and, if necessary, redeemed. The amount of the redemption is determined by the present value of the right-that is, the discounted value of the remaining term of use.

Practical Tip for Property Owners in Nuremberg and Franconia

For every purchase transaction in Nuremberg and the metropolitan region, we check the land registry for registered rights of use. Housing rights and usufruct rights in favor of former owners or family members are often entered in the land registry following gifts or anticipated succession-and are sometimes forgotten. Buyers should pay particular attention to these entries, as they can significantly restrict the free disposal of the property.

Especially in older buildings in downtown Nuremberg, Erlangen, or Fürth, we frequently encounter historical easements and rights of way dating back to the early 20th century, which, while still legally valid, require an assessment of their economic relevance. We assist you with a legally sound assessment and, if necessary, the redemption of existing rights, and we have a broad network of specialized real estate attorneys in the region.

Frequently Asked Questions

Can I sell a property on which a right of use is registered?

Yes, a sale is possible-but the buyer automatically assumes the right of use as well. This restricts the free usability and value of the property. Many buyers therefore demand prior cancellation or request a corresponding reduction in the purchase price. In the case of residential rights or usufruct by an elderly person, the reduction is manageable; for younger beneficiaries, it can be significant.

What is the difference between a residential right and a usufruct right?

With a right of residence, the beneficiary may only occupy the property themselves-renting it to third parties is prohibited. With usufruct, however, the beneficiary may also rent out the property and collect all proceeds from it. Usufruct is thus the more comprehensive right and has a higher capital value-and therefore results in a higher reduction in value upon sale.

How long does it take to remove a right of use from the land register?

If the beneficiary has passed away or has issued a notarized authorization for deletion, the deletion takes place within a few weeks after the required documents are submitted to the land registry office. The exact processing time depends on the workload of the respective land registry office. In Nuremberg, experience shows that processing times for simple deletion requests are two to four weeks.

Can a utility easement prevent a construction project?

Yes. A utility easement may include a protective strip within which construction is prohibited. Before building on a property encumbered by such an easement, one should have the specific terms of the easement clarified in the land registry and with the registered holder (e.g., the municipal utility company). In Nuremberg, historic district heating or power lines often run beneath private properties-their protective zones can significantly restrict building plans.

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