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This is an up-date to an article I had written a few months ago in Escape Artist, on how to buy a castle in the former east German states where many such castles and manor houses are still for sale. Some regulations and prices (unfortunately) have changed recently in regard to the low dollar and the high euro. Yet, considering what you get, the prices for a historic castle or manor house in those states are about 1/3 to 1/2 of what a similar property costs in the rest of Europe. The castles and  manor houses that are for sale were confiscated by the East German Communist Government after the end of the WWII, or they were simply left behind by its owners who had fled to the west. When the Berlin Wall came down the castles and manor houses were offered back to their former owners. However, many did not want them back because of the run-down condition they were in, or the owners could no longer be found. The states then acquired these castles for the value of the property, or if they were not claimed back by a certain date, they became automatically the property of the state, a town, or a city. The departments of historic preservation (Denkmalschutz) of the states of Saxony, Brandenburg, Saxon-Anhalt, Thueringia and Mecklenburg-Vorpommern, in conjunction with the cities and towns where such properties were located, set up a fund to restore these historic castles and manor houses, however, the fund fell far short of what was needed. Thus they began to offer them for sale. A castle or manor house to this day still sells for about 1 Euro plus the cost of the property which is often less than its market value. However, renovation is always needed which can run from about E6,000,000.-- to E2,000,000.-- depending on the size and condition of a property. There are, however, incentives to restore such castles and manor houses. The states have funds which pay subsidies toward renovation. This can be as much as 30% to 40% of the cost of renovation. Grants are allowed and agreed to before renovation begins, but are paid after renovation is finished. Thus, an investor will have to invest his own capital before receiving the subsidies.  An investor is also entitled to receive the 16% VAT tax (value-added tax) back he has paid for building supplies. This too has to be applied for, and is paid after renovation is finished.

Castle Lauterbach  -  17th century Note: EscapeArtist.com also has listings for Castles and Mansions. Castles for Sale - Castles for Sale - Mansions - Mansions For Sale Worldwide -

Castle Wachau - circa 1720

In some cases you may even be able to acquire a property without having to pay for it at all. This is called Erbbaurecht in German. It involves a historic property which is given to you on a 99-year lease in exchange for renovating it. Renovation guidelines for such properties are strict and the Denkmalschutz, the department of historic restoration, will stipulate what you can and can not do. Their aim, to restore the property in its original form and to give it a cultural or commercial use.  Proof of financial ability to restore the project is necessary.  If the property has a commercial use and it starts to show profits, an interest payment of from 2% to 4% per month of the profit is charged. Thus, if you would earn $3000 a month you would have to pay  from $60 to $120. Another stipulation is that you must keep the property for 10 years, after this you are free to sell it. At the end of the 99-year lease the then owner of the property may sell it or renew the lease, or the state will buy it back for its market value. The latter, however, is of little consequence to most who enter into such a contract.

All this is not as complicated as it sounds, the problem, however, is that if someone wants to buy a castle he or she often runs into a brick wall since little or no information is available about such properties. The Ministry of Interior of Saxony used to publish a book which was available from a publisher of the ministry.  However, the book was discontinued recently and is no longer available. For the most part real estate agencies do not deal in such properties since no commissions are paid. Some agencies such as www.brecht-immo.de offer a few castles, but they are castles that have already been restored or bought by someone, and are for sale again, consequently they are more expensive.  There is also an auction house; http://www.immobilienauktionen-sachsen.de  which sells properties on behalf of the state, the problem here is that the list of objects offered for sale comes out a month or less before an auction takes place. Not enough time to gather info, or make a trip to look at the objects offered for sale.

Castle Lauterbach  -  17th century

QUESTIONS AND ANSWERS
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Castle Stuelpe - circa 1750

Q.  Can an American citizen own real estate outright in Germany? A.   Yes, American, Canadian, Australian and citizens from many other European countries can own real estate in Germany without restrictions. Q.  How much does a castle cost on the average? A.  The cost, of course depends on the size of the property, its location and its condition. On the average, a castle or manor house in a rural area with about 1,200 square meters (13,000 square feet) floor space and 2 to 5 acres of ground runs approximately E100,000.-- to E200,000.-- if the condition is such that it needs extensive renovation. This sum could go up if the condition is good. Q.  How much does it cost to renovate a castle? A.  A castle that is in poor condition and needs extensive renovation costs about  E1000 per square meter (about 11 square feet) If the castle is in good condition renovation costs run about E600 to E700 a square meter.

Q.  Are there sources in the United States where I can find out about castles in eastern Germany?
A.  Yes, you can contact us at: contact@poshjourneys.com.  We can say with much certainty that we are the only ones in the United States who have detailed knowledge about such properties. You can go to our website Posh Journeys to see pictures of some of the currently available properties and information for them. There are many more than what is shown on our web site, but it is virtually impossible to list all, particular since availability can change at any time.

Q.  What is the charge if I want to carry things further and get a list of properties with pictures and descriptions that fit my interest?
A.  You can hire Mr. Pawlik to do a search for you. You will receive pictures, descriptions, purchase price, floor plans if available, location maps, a report on the condition of the properties and their approximate renovation cost for from 15 to 25 properties that are in your range of interest. The cost for this service is E2000.--
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Q. What if I would like to make a trip to Germany to inspect a number of castles? A.  The cost for Manfred Pawlik's services as your consultant are the same as above. In addition you will have costs for our services and expenses if you hire us as your driver, guide, interpreter etc. The cost per person based on two people traveling together, is about $3000 per person which includes Mr.Pawlik's service fee, 5 full days of castle inspections, an 7-nights lodging.  If you want to go on your own you will have the cost for a rental car, lodging, gas, food etc. as well as the fee for an interpreter. An interpreter will be necessary since quite obviously you will have technical questions. Mr. Pawlik does speak some English, but you will need someone who speaks it fluent to answer all your question correctly. Air fare is separate. You can also opt to join one of our castle inspection tours which are based on 3 to 5 persons traveling together, the cost then is about $2,500.00 per person, airfare not included.

Castle Schiernitz  - 14th century

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Q.  If I decide to buy a castle and hire Mr. Pawlik as my consultant to handle everything for me what will it cost?
A.  The costs for Manfred Pawlik to handle everything for you, from making the purchase offer to negotiating the price, to applying for subsidies, to handling all paperwork to close the sale, ranges from $6,500 to $11,500 depending if the property is private or commercial. Renovation will be handled on a cost-plus basis under a separate contract.

Q. Are there restriction to receiving grants?
A. Yes, in some states. For instance if you decide to make a castle into a B&B and operate it yourself you may not be able to get grant money. It seems that there is now a sufficient number of B&B's or holiday apartments, especially in the state of Saxony,  that no more are needed.  If, however, you hire help and create a job or jobs, assistance will still be available. A much desired use would be a computer related facility such a training facility of which there is a shortage at the present. Subsidies do, for the most part,  depend on the later use of a property.
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Castle Ruhetal - 13th century

Q.  Let's say I buy a castle and restore it, what about hiring someone to oversee it when am not there? A.  Since most castles and manor houses are located in rural areas it is not difficult to get good reliable people who will look after your property. You can probably hire someone for about $8 an hour who will come in an hour or two every day, or every other day, to make sure all is in order and handle any of the reservations if you decide to rent the property while you are absent. To find a reliable caretaker is included in Mr. Pawlik's fee. Q.  Is buying a castle or manor house a lucrative investment? A.  If you are looking to make a quick buck, no.  Profits will  come with time. Once the castle is restored its value does go up. In the long run when many of these castles and manor houses have been bought and restored, their value will be considerably higher.

Q.  Let's say I have bought a castle,  how long do I have to restore it?
A.  There is no actual time limit. You don't have to restore it at once, however, you must start restoration within a reasonable amount of time, six months to a year. These properties are sold to be restored, not to be bought on speculation for perhaps another use. If nothing is done to a property within two years, the seller may in some cases be able to recall the sale.

This should answer many of your questions. If you have questions I have not covered, feel free to contact me. Keep in mind, that sometimes, when we are on a trip, it may take a week or two to get back to you, otherwise we try and answer within a day or two.
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To own a historic castle or manor house is indeed an exciting prospect, and not as impossible as it seems. What makes the area of eastern Germany particularly attractive is that you are never far from a large city and an international airport from where you can fly to anywhere in Europe within a few hours. Yet the majority of castles are located in rural surroundings, in the midst of meadowland, forests and wooded mountains. Zoning regulation are strict and a farmer can not simply sell his land to make it into a commercial enterprise. This region is one of the most historic in Germany. The electors of Saxony and the Prussian Kings had great influence throughout Europe from the 15th to 18th centuries. The land, particularly in Saxony, was rich and people became wealthy. In some places one will find several manor  houses and castles within a radius of ten miles. The cities of Dresden, Leipzig, Pirna, Meissen, Magdeburg and Schwerin in Mecklenburg Vorpommern are among the most historic in Germany, and Berlin, Germany's chic new capital is easily accessible from anywhere.

Castle Lauterbach  -  17th century

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I hope that this bit of insight into a real estate market that seems to be almost a secret was of interest to you.  Who knows, perhaps one day you will be the lord of a castle.  For more detailed information read my eBook - All You Ever Wanted To Know About Buying A Castle answers all the questions that arise once you decide you want to pursue this most ultimate of dreams. This guide is the only publication in print or eBook form that advises the reader step-by-step on how to become the owner of a castle. This eBook instructs the reader how and where to start looking for the castle of his dreams, how to set up a viewing trip to see castles that are for sale, how to make arrangements to negotiate a sale, and how to proceed once the castle is purchased. Then it´s time to start shopping, in France, Spain, Germany, Poland, Romania, or ten other countries that are explored in detail in this guide. 
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