Who writes the appraisal for a compulsory auction?

An expert appointed by the enforcement court. The expert inspects the property as far as access is granted and determines the market value as of a valuation date. The court then fixes that value by order (§ 74a (5) ZVG). The appraisal serves the proceedings, for example the value thresholds and the bidding security. It is not a structural survey for your purchase decision.

What does the appraisal for a compulsory auction not contain?

Which rights in the land register remain is decided by the court only at the hearing, together with the lowest admissible bid. The condition after the valuation date is missing, as is anything the expert could not see, such as rooms without access or hidden damage. Building encumbrances, leases and service charge figures appear only if the expert obtained them. There is no warranty (§ 56 ZVG).

Is the market value in the appraisal the price I have to pay?

No. The market value is the court's estimate of the market price on the valuation date. Bidding happens at the hearing, and the award can go below or above it. If rights in the land register remain, you take them on in addition to your cash bid. Until the award has once been refused on a threshold ground, a bid below five or seven tenths of the market value can fail (§§ 85a, 74a ZVG).

Reading a compulsory auction appraisal

At a compulsory auction you buy without a warranty and often without ever having seen the property from the inside. Most of what you can know about the house or flat is in one document, the market value appraisal (Verkehrswertgutachten). With its annexes it often runs to several dozen pages. The sentences that matter are rarely at the front.

This guide works through the appraisal section by section. You will see where to get it, what it leaves out, which phrases point to a risk and which questions to take to the court or a specialist afterwards. For an overview of the land register, occupancy and condominium documents, see Reviewing a property before a compulsory auction.

What the appraisal is and who writes it

The enforcement court appoints an expert in property valuation. The expert inspects the property at a site visit, works through documents such as the land register, the cadastral map and the building file, and determines the market value. Under § 194 BauGB that is the price obtainable in ordinary business dealings at the point in time the valuation refers to. An appraisal therefore describes one particular day.

The court fixes the value, consulting experts where necessary (§ 74a (5) ZVG). The parties to the proceedings can challenge that order with an immediate appeal. The award itself, however, cannot be contested on the ground that the value was fixed incorrectly. The court needs the market value for the value thresholds and for the amount of the bidding security. It is no promise about the condition of what you are buying.

Nor is the market value appraisal a structural survey. As a rule the expert judges the condition by visual inspection. Building components are not opened, no samples are tested for pollutants, and neither the structure nor the building services are checked. Many appraisals say so in their preliminary remarks, which is why those pages are worth reading first.

Where to get the appraisal

The notice of the auction date is meant to state the market value (§ 38 (1) ZVG). Once a date has been announced, the appraisal therefore almost always exists. In principle at least six weeks must pass between the announcement and the hearing (§ 43 (1) ZVG). Those weeks are your reading time.

§ 38 (2) ZVG allows courts to publish appraisals electronically. On zvg-portal.de some local courts attach the appraisal, an exposé and photos as PDFs to the full view of an auction; others do not. How to search there and find the PDF is explained in Using the ZVG portal.

If nothing is online, you can inspect the appraisal in the case file at the court registry of the auction court. Many courts provide copies for a fee per page. While you are there, look at the rest of the file: under § 42 ZVG anyone may inspect the notices from the land registry and the claims the creditors have registered.

Our directory shows, for every recorded auction, which official documents are available.

What the appraisal does not contain

Before you start reading, it helps to know what you will look for in vain:

Which rights remain after the award is determined by the court only at the hearing, together with the lowest admissible bid (§§ 52, 66 ZVG). The appraisal can only list the entries in the land register.
Months often pass between the valuation date and the hearing, years in the case of a repeated hearing. Vacancy, frost or vandalism during that time appear nowhere.
Rooms the expert could not enter, hidden damage and pollutants are unknown to the expert.
Leases, service charge statements, resolutions of the owners' association or an extract from the register of building encumbrances are included only if the expert obtained them.
There is no guarantee: under § 56 ZVG, no claim to a warranty exists.

The appraisal, section by section

Appraisals are structured differently, but many follow a similar order. They start with the commission, the valuation date and the site visit, then the plot and the land register, the legal circumstances, the building and its condition, the use and finally the valuation. Photos, plans and extracts follow as annexes. We go through them in that order.

Preliminary remarks and site visit

This part states when the expert was on site, who was present and which rooms the expert could enter. Phrases such as „Innenbesichtigung nicht möglich“ (interior inspection not possible) or „nach dem äußeren Eindruck“ (based on the external impression) mean that everything about the interior is an assumption. The owner is not obliged to let the expert in.

Without access, the expert estimates the interior from the year of construction, the exterior and the building file and often applies a discount for the risk. Check how large that discount is and how it is justified. It remains an estimate of how the market prices the risk. Nobody knows afterwards what lies behind the door.

Watch out for partial inspections as well, for example an accessible cellar while the flat upstairs stayed locked. And look for the word „unterstellt“ (assumed): it marks an assumption, such as a floor area taken from old plans instead of being measured.

Land register and section II

The appraisal reproduces the land register as it stood when the appraisal was written, often with the extract as an annex. Section I names the owner, section III the land charges and mortgages. What matters most to you is section II, with its encumbrances and restrictions: right of residence, usufruct, right of way, utility easement, right of first refusal, real burden or retirement provision (Altenteil). The compulsory auction entry (Zwangsversteigerungsvermerk) is also made there; it belongs to the proceedings.

Whether a right still burdens the property after the award depends on its rank. Rights that rank ahead of the claim of the best-ranking creditor pursuing the auction fall into the lowest admissible bid and remain (§§ 44, 52 ZVG). All others lapse with the award (§ 91 ZVG). The exception is a right registered as a retirement provision (Altenteil or Leibgedinge): depending on the law of the federal state, it remains even if it is not part of the lowest admissible bid (§ 9 EGZVG). A party whose right ranks ahead of it or equally and would be impaired by it can demand that its extinction be set as a condition of the auction. If only the bank pursues the auction from its land charge, a right of residence ranking ahead of it remains, while one ranking behind it lapses. The court gives the binding answer at the hearing.

So check in the valuation section whether the expert calculated the market value with or without the rights in section II. Appraisals for compulsory auctions often determine the value without these encumbrances and state the value of each right separately. If a lifelong right of residence then remains, you pay your bid and carry the right on top.

Building encumbrances (Baulasten)

A Baulast is a public-law obligation an owner takes on towards the building authority, for example to keep an area free as an access route, a parking space or a setback area for the neighbouring plot. It is entered in the register of building encumbrances kept by the lower building authority, separately from the land register. It does not lapse with the award.

Check whether the expert obtained an extract from that register and what date it bears. If the appraisal only says that encumbrances are „nicht bekannt“ (not known), the expert may not have asked. In that case, ask the authority yourself and quote the case reference of the proceedings. Whether you receive information as a prospective bidder depends on the federal state. Bavaria has no Baulast; comparable obligations are entered there as easements in section II of the land register.

Contamination, listed buildings and development charges

On contamination, the expert often asks the register of contaminated sites kept by the district or city administration. Without such an enquiry, the plot is often „unterstellt“ (assumed) to be free of contamination. That assumption is no substitute for a soil survey. It matters to you because, under § 4 (3) BBodSchG, the owner of the land can be obliged to remediate it alongside the polluter. A former filling station or workshop, an old oil tank or backfilled ground on the plot are reasons to ask.

Whether a building is listed, the expert takes from the list of monuments or from information provided by the monument authority. Changes to the facade, windows, roof or floor plan then need a permit, and renovations often cost more and take longer. Tax benefits for listed buildings exist, but they depend on conditions you should clarify with a tax adviser before you bid.

The legal section also states whether development charges for the plot have been paid. If a road has not yet been billed, the charge is owed by whoever owns the plot when the assessment notice is issued (§ 134 (1) BauGB). After the award, that can be you.

Use and tenants

The appraisal states whether the property is vacant, lived in by the owner or let. If it is let, it usually gives the rent that was reported to the expert. The expert has often not seen the lease itself.

You take over a let property together with the tenancy. § 57 ZVG refers to the rules under which a lease passes to the acquirer (§§ 566 et seq. BGB), including the rental deposit. The special right of termination in § 57a ZVG allows you to give notice with the statutory period for the first permissible date. That helps above all with long fixed terms. For residential tenancies you still need a ground for termination, such as own use (§ 573 BGB).

If the debtor lives in the property, the award order is an enforceable title for eviction (§ 93 ZVG). Eviction costs time and money; see After the award. If a compulsory administration runs alongside the auction, a compulsory administrator collects the rents. The administrator knows the leases and the payment record. Whether you get information is the administrator's decision.

Condition and backlog of repairs

The building description lists the year of construction, type of construction, roof, windows, heating and fittings, followed by building defects and damage. Read that list twice: first for what the expert established, then for what the expert only suspects or was told by occupants.

Damp cellar walls, cracks, a leaking roof or a heating system at the end of its life cost money. In buildings dating from before the 1993 asbestos ban in Germany, asbestos may be present in the roof, facade or floor coverings. An appraisal based on visual inspection does not rule that out.

The expert enters the deduction for defects as a discount customary in the market (§ 8 (3) ImmoWertV). It expresses how the market values the defect. It is not a cost estimate, and the repair can cost considerably more. For an estimate of the cost, ask a building surveyor or a contractor who assesses the property from outside and from the photos.

For a condominium, the service charge, the maintenance reserve and the owners' association's resolutions are part of the condition, because the association decides about the roof, facade and heating. If this information is missing, see the section on service charge arrears in Reviewing a property before a compulsory auction.

Valuation and valuation date

The German valuation regulation (ImmoWertV) knows three methods (§ 6 ImmoWertV). The comparative value method uses the prices of similar properties and is often decisive for flats and building land. For let properties, the income value method starts from the rent that can be achieved sustainably. Owner-occupied one- and two-family houses are mostly valued with the asset value method: it values land and building and then adjusts the result to the market.

For your review, the inputs matter more than the formulas: the floor area, measured or taken from plans, the standard land value, the remaining useful life, the assumed rent, the property yield rate or the market adjustment factor. As a rule the appraisal names a source for each of these figures, often the local valuation committee (Gutachterausschuss). If a figure differs clearly from what you know about the area, ask why. Then come the additions and discounts for defects, for rights and for the risk of a missing interior inspection. Only these produce the market value.

Two dates belong in the margin: the valuation date, which fixes the market conditions, and the quality date for the condition (§ 2 ImmoWertV). Usually they are the same day, often the day of the site visit. If it lies more than a year before the auction hearing, interest rates, prices and the condition of the house may have changed. Ask the court registry whether there is a supplement to the appraisal.

Also look for a separate value for accessories (Zubehör), such as heating oil in the tank or, depending on the region, a fitted kitchen. Accessories are auctioned along with the property (§ 55 ZVG), and the appraisal estimates movable items separately (§ 74a (5) ZVG). For financing, your bank values the property by its own rules.

Warning signs and whom to ask

Some phrases deserve more than a note in the margin. The table matches them to the places that can give an answer.

The appraisal says	Why it matters	Whom to ask
Interior inspection not possible	Interior condition and fittings are estimated	A building surveyor, for an assessment from outside and from the photos
Right of residence, usufruct or real burden in section II	If the right remains, you carry it on top of your bid	The judicial officer on the state of the file, a lawyer on the consequences
Building encumbrances „nicht bekannt“ or not checked	A Baulast survives the award	Lower building authority
Freedom from contamination „unterstellt“, previous commercial use	As owner you can be obliged to remediate	Lower soil protection authority, a soil surveyor
Listed building	Permits required, higher renovation costs	Lower monument protection authority
Let, lease not available	You take over a contract you do not know	The compulsory administrator, if appointed, a tenancy lawyer
Development charges not yet billed	The assessment notice can reach the new owner	Municipality or city administration
Valuation date long before the hearing	Market and condition may have changed	Court registry about a supplement, your own look from outside

Ask the court about the procedure, not about the valuation. The court registry and the judicial officer (Rechtspfleger) do not give advice, but they usually answer these:

Will the hearing take place as announced, or has it been cancelled or postponed?
Is there a supplement to the appraisal or an amended fixing of the value?
Which rights are to remain according to the current state of the file?
Has a compulsory administrator been appointed?
May I inspect the notices from the land registry and the registered claims (§ 42 ZVG)?

What you hear there reflects that day's state of the file. The lowest admissible bid and the auction conditions become binding only at the hearing.

Note the page for every finding

A sentence on page 23 is hard to find again two days later. So note four things for every finding: page and section, the sentence word for word, your conclusion and the open question. An entry could look like this:

p. 7, site visit
Wording: „Eine Innenbesichtigung war nicht möglich.“
Conclusion: interior condition and fittings are assumed.
Open: How large is the discount for this in the valuation?

This keeps what the appraisal says apart from what you conclude from it. Contradictions stand out, for example when the floor area in the building description differs from the one in the valuation. And when your bank, a surveyor or a lawyer asks, you open the page instead of reading the whole document again. Collect your open points on the checklist.

What ZVG Melder takes on, and where it stops

ZVG Melder reads available appraisals with AI and stores the information from the sections above in structured form: site visit and interior inspection, rights in section II, building encumbrances, contamination, listed status, use, condition, valuation date and valuation inputs. Where an appraisal has been analysed, a risk class from 1 to 6 summarises the findings detected. A critical finding needs evidence: a verbatim quote from the document, with the page where the passage could be located. That lets you look up the passage in the original. Where evidence is missing, we show the gap. In the document chat you can ask the available documents specific questions, such as the date of the building encumbrance extract.

The limits of reading by hand apply here too, and a few more are added. ZVG Melder only knows what courts publish: auctions that local courts from 14 federal states announce on zvg-portal.de, and appraisals only where a court puts them online. Hamburg and Mecklenburg-Western Pomerania are not included. Scanned or poorly legible pages can prevent an analysis, and new documents are processed with a delay. What the expert did not see, the analysis does not know either, and which rights remain is decided by the court at the hearing.

A low risk class therefore means few evidenced findings in the documents available. It does not promise a property free of defects. How the classes are formed is explained in How we determine risk classes; source types and limitations are described in the methodology.

Key points

Read the preliminary remarks and the site visit first. They say what the expert saw and what the expert assumes.
Compare section II with the valuation and check whether the value was calculated with or without the rights.
Building encumbrances and contamination are kept in their own registers, and the municipality knows about open development charges. Check whether and when the expert enquired there.
A discount for defects is a market discount. Estimate repair costs separately.
Compare the valuation date with the hearing and ask about a supplement.
Note every finding with its page and wording.

Note: General guidance, not legal, construction or tax advice. The original appraisal, the official notice and the court's determinations at the hearing are authoritative.

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Reading the appraisal for a compulsory auction: what it says, what it leaves out and where the risks are

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