Reason to sell4 min read

Community of heirs & property sale

A community of heirs (Erbengemeinschaft) is not a partnership — it is a forced alliance. Several people who did not choose this must decide together about a property. In my experience, in half of all cases it fails because of communication, not the numbers. The good news: there is a solution for every constellation.

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What happens if a community of heirs cannot agree on a property sale?

In principle, all heirs must consent to the sale. If no agreement is reached, a partition auction can be applied for as a last resort, but this is rarely in everyone's interest. We help to find an amicable solution and, if necessary, refer you to experienced inheritance-law solicitors.

What is a community of heirs?

Joint ownership (Gesamthandsgemeinschaft) under Section 2032 BGB

When several people inherit, a community of heirs arises automatically. Legally a joint-ownership community — which means: none of the heirs can dispose of the property alone. Every decision requires unanimity. Sale, letting, renovation — nothing happens without everyone's consent.

That sounds like good protection. In practice it is a blocking mechanism. A single heir who does not want to sell (or cannot, or will not, because they want to get back at the others) can paralyse the entire process.

Are you stuck in a community of heirs?

Discuss without obligation

Options: sale, buy-out or auction

Joint sale

The best solution in almost all cases. All heirs agree on a sale, share the proceeds proportionally and dissolve the community of heirs. In Dresden such a sale takes three to six months — plus the time for the prior agreement.

Buying out a co-heir

One heir takes over the property and pays out the others. Requirement: sufficient financial strength or a bank's willingness to finance the purchase. The takeover price is based on a neutral valuation — not on what an individual heir „considers appropriate“.

Letting

The community of heirs keeps the property and lets it. Income is shared proportionally. Sounds good in theory. In practice: who handles the management? Who pays for repairs? Who decides when tenants change? Without clear rules this ends in constant conflict.

Partition auction (Teilungsversteigerung)

The last resort. Any co-heir can apply for it at the local court — unilaterally, without the others' consent. The result: the property is auctioned, the proceeds distributed proportionally. The problem: in Dresden auction prices are 20 to 30 percent below market value. Everyone loses.

Unanimity principle: what to do in a deadlock?

The most common scenario: two of three heirs want to sell, one does not. What now?

Step 1: Seek a conversation

Sounds trivial, but is often skipped. The blocking heir often has an understandable reason — emotional attachment, uncertainty about the value, fear of being disadvantaged. An open conversation with concrete figures can work wonders.

Step 2: Neutral valuation

If the dispute is about value, a market-value appraisal creates clarity. Cost: 1,500 to 3,000 euros — divided by the number of heirs. The best investment you can make.

Step 3: Mediator or lawyer

A mediator can mediate between the parties. A lawyer specialising in inheritance law can set out the legal options. Both cost money — but considerably less than a partition auction.

Step 4: Threaten a partition auction

Sometimes the threat alone is enough to bring the blocking heir to the negotiating table. The prospect of losing 20–30 percent below market value is motivating.

Step 5: Apply for a partition auction

When nothing else helps. Any co-heir can apply for it unilaterally. The procedure takes six to twelve months.

A case from my practice: Three siblings inherited an apartment building in Pieschen. Two wanted to sell, the third wanted to “keep the family home”. After a neutral valuation (value: 820,000 euros) and a conversation with a mediator, a solution was found: the third sister took over the property and paid out her siblings with a bank loan. Everyone was satisfied — it only took three months of conversation.

Partition auction: the last resort

I almost always advise against it. The numbers speak for themselves:

The auction in numbers

Average auction price in Dresden70–80 % of market value
Procedure costs (court, appraiser, lawyer)3,000–8,000 €
Procedure duration6–12 months
OutcomeAll heirs receive less
A counterintuitive detail: In a partition auction, every co-heir can bid themselves. If an heir wants to keep the property, they can win it at auction — but at a price third parties are also willing to pay. This protects the other heirs from an undervaluation.

Valuation and price-finding in case of disagreement

The dispute over value is the most common cause of deadlock. Therefore:

Commission an expert together

A publicly appointed and sworn expert — commissioned jointly. This creates acceptance among all parties.

Agree in writing in advance

Agree in writing in advance that everyone accepts the result. This prevents the losing side from questioning the appraisal afterwards.

Use the appraisal as a basis for negotiation

Use the appraisal as the basis for all further negotiations — whether sale, buy-out or letting.

Cost of a market-value appraisal: 1,500–3,000 euros. Divided by three heirs: 500–1,000 euros per person. The best investment in family peace.

Save yourself this cost for now: get a first, no-obligation estimate of the property's value — free of charge and without commitment for all heirs.

Free value estimate

Tax aspects in a community of heirs

Inheritance tax

Each heir taxes their share individually. The allowances depend on the degree of kinship (children: 400,000 euros, siblings: 20,000 euros).

To the inheritance tax calculator

Speculation tax

The deceased's holding period is credited. If the deceased bought the property more than 10 years ago, the sale is tax-free.

To the speculation tax calculator

Income from letting

Distributed proportionally among the heirs and taxed individually.

Our role: neutral intermediary and market expert

In communities of heirs, neutrality is decisive. When one heir engages the agent, the others become distrustful. That is why we work transparently for all parties:

Joint engagement by all heirs
Open communication with all parties
Neutral valuation as a basis
Regular updates to all heirs
Negotiation in the interest of the community, not an individual

Tax note: Non-binding guidance, without warranty – not a substitute for tax advice.

Free valuation of your property

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Frequently asked questions

What happens if we cannot agree within a community of heirs?
Unfortunately, this is common. In principle, all heirs must consent to a sale. If no agreement is possible, a partition auction can be applied for as a last resort — but this is rarely in everyone's interest. We help to find an amicable solution and, if necessary, refer you to experienced inheritance-law solicitors.
Can I sell my share of the inheritance individually?
Yes, in theory. You can sell your notional share of the community of heirs. In practice this is difficult: there are hardly any buyers for fractions of a community of heirs, and the price is far below the proportionate market value. The other co-heirs have a right of first refusal.
How long can a community of heirs exist?
In theory, indefinitely. In practice you should aim to dissolve it as quickly as possible. The longer the community exists, the higher the running costs and the potential for conflict.
What happens if a co-heir cannot be reached?
This can delay the sale considerably. An absentee curator can be appointed by the court - but that takes time. Try to involve all co-heirs early on.
Who bears the running costs of the property?
All heirs proportionately. Property tax, insurance, maintenance - the costs run on, whether or not the heirs agree. Another reason to resolve the situation swiftly.
Do I need a solicitor?
For simple communities of heirs (two heirs, a clear will, no conflicts): not necessarily. For three or more heirs, disputed wills or blocking co-heirs: strongly recommended. The costs are manageable compared with the possible losses from a badly resolved community of heirs.
Can I prevent a partition auction?
Only by agreement. If a co-heir applies for the auction, you cannot object. But: you can still find an amicable solution while the proceedings are ongoing. Even after an application has been filed, a withdrawal is possible if everyone agrees.
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