Investor Guide
2026-10-10 08:28

Gewährleistung (warranty for defects): Five Years of Claims — If You Own Them and Stop the Clock in Time

Gewährleistung is the statutory liability of a builder or seller for defects; for a building, the claims generally become time-barred after five years. Investors lose it in two ways: they buy a store without acquiring the claims, or they let the period run out while exchanging letters.

What it is

German law has two regimes.
New building from a developer. Works-contract law governs the construction (§ 650u(1) sentence 2 BGB). The buyer may demand repair, remedy the defect itself and claim the cost, withdraw or reduce the price, and claim damages (§ 634 BGB). For a building, these claims become time-barred five years after acceptance (§ 634a(1) no. 2, (2) BGB).
Completed store from its owner. Sales law applies (§ 437 BGB); for a building the period is also five years, running from handover (§ 438(1) no. 2 lit. a, (2) BGB). The seller's liability may be excluded by contract — in our experience the norm for existing property — except for a defect fraudulently concealed or covered by a guarantee of quality (§ 444 BGB).
For a defect fraudulently concealed, the regular limitation period applies instead in both regimes, but not before the five years have run (§§ 438(3), 634a(3) BGB). A guarantee (Garantie) is something else: a voluntary promise on top of the statutory liability (§ 443 BGB).

Why it matters to investors

Defect claims do not pass with the land. A buyer who acquires a store from a previous investor owns the defects but not the claims unless the purchase contract assigns the seller's claims against developer and contractors (§ 398 BGB; Part 7). And the period runs from acceptance, not from purchase: a store bought two years after acceptance has at most three years of cover left (Part 6).
Under the Civil Code, a letter of complaint does not stop the clock. Negotiations suspend it (§ 203 BGB), as do a lawsuit and court-supervised evidence proceedings (selbständiges Beweisverfahren) (§ 204(1) nos. 1 and 7 BGB). An acknowledgement by the debtor restarts it (§ 212(1) no. 1 BGB). No statute gives the buyer security for the period, so investors negotiate a warranty guarantee — in our experience around 5% of the contract sum (Part 6). Once the period ends, repairs to roof, structure and building services fall on the owner, as far as the lease does not pass them to the tenant (Part 6).

What to check

• The acceptance date of each building, and the expiry date that follows from it.
• An assignment of the seller's defect claims in the purchase contract, and the scope of any liability exclusion.
• A technical inspection about six months before expiry (Part 7).
• For open defects, steps that legally suspend or restart the period — not letters alone.
• The warranty guarantee: amount, issuer and term.
Related terms: Abnahme · Bauträger · Due Diligence
Sources: BGB §§ 203, 204, 212, 398, 437, 438, 443, 444, 634, 634a, 650u; Gordon Real Estate Group, "German Prime Retail", Parts 6 and 7. Legal position as of 10 October 2026.
Photo: Peter Herrmann / Unsplash
This entry is general information and not legal or tax advice.