Short answer: The partition auction (Teilungsversteigerung) is the compulsory auction of an estate property for the purpose of ending the community of heirs (Erbengemeinschaft) (§ 753 (1) German Civil Code, Bürgerliches Gesetzbuch, BGB, §§ 180 ff. Compulsory Auction Act, Zwangsversteigerungsgesetz, ZVG). Each co-heir can apply for it at the local court (Amtsgericht), without an enforceable title (§ 181 (1) ZVG). It converts the property into money but does not end the community of heirs: the proceeds still belong to all co-heirs jointly and must still be distributed.
The partition auction of a community of heirs is the procedure that individual co-heirs initiate when an inherited house or property cannot be sold by private treaty because the co-heirs cannot agree. Legally it is a compulsory auction procedure under the ZVG with its own rules for ending a community. The conditions, the procedure, the costs and the protective options of co-heirs who do not want the procedure are set out below. The article is also written for co-heirs living abroad, for example when siblings in different countries inherit a German property and one of them wants to force a sale. Other routes of dissolution and a blockade by a co-heir are explained on separate pages. The legal position is October 2026.
When Is a Partition Auction Possible?
A partition auction presupposes a property in the estate that cannot be divided in kind without loss of value. For ending a community, the law first provides for division in kind (§ 752 BGB); if this is excluded, for properties the community is ended by compulsory auction and division of the proceeds (§ 753 (1) BGB). For the community of heirs this rule applies via § 2042 (2) BGB.
The conditions in detail:
- Co-heir as applicant. The applicant must be registered as owner in the land register or be the heir of a registered owner, or exercise the owner’s or heir’s right to end the community (§ 181 (2) sentence 1 ZVG). The succession must be made credible by documents unless it is obvious to the court (§ 17 (3), § 181 (4) ZVG); in practice a certificate of inheritance or an opened notarial will serves this purpose.
- No title needed. An enforceable title is not required (§ 181 (1) ZVG). The court examines the conditions of the application, not the entitlement to division in detail.
- Competent court. The local court in whose district the property is situated has jurisdiction (§ 1 (1) ZVG). For a property abroad, the procedure before a German local court is not available.
- No exclusion of division. If the testator excluded division by a testamentary disposition, this in principle has effect up to 30 years after the death (§ 2044 (1) and (2) BGB). Division is also postponed where shares are still undetermined because of an expected birth (§ 2043 BGB), and, at the request of a co-heir, during a public-notice procedure for estate creditors (§ 2045 BGB).
- Executorship. If an executor is entitled to carry out the division, he or she must effect it (§ 2204 (1) BGB); as long as he or she is in office, a co-heir cannot pursue the partition auction against his or her will (BGH, order of 14 May 2009, Az. V ZB 176/08); the co-heir must press the executor to carry out the division.
For precautions by testators who want to avoid disputes over a house, see the article on estate planning.
The Procedure Step by Step
- Application and order. The application goes to the competent local court as enforcement court. With a land register extract and proof of succession, the court orders the compulsory auction for the purpose of ending the community. The rules on compulsory auction apply accordingly, unless §§ 181 to 185 ZVG provide otherwise (§ 180 (1) ZVG).
- Joining of further co-heirs. If a further co-heir files an application of his or her own, his or her joining is admitted and he or she has the same rights as the first applicant (§ 27 ZVG).
- Market value. The court fixes the value of the property, if necessary after hearing experts (§ 74a (5) ZVG, applicable via § 85a (2) ZVG). The decision fixing the value can be challenged by immediate complaint; that the value was fixed incorrectly can no longer be asserted against the award of the bid later (§ 74a (5) sentences 3 and 4 ZVG). Anyone who considers the value wrong must therefore react early.
- Setting the date. The auction date must be cancelled and set anew if the notice of the date was not made public six weeks before the date (§ 43 (1) ZVG). The same applies if an enforceable order has not been served on the debtor and the notice of the date on the known participants four weeks before the date (§ 43 (2) ZVG).
- Minimum bid (geringstes Gebot). At the auction only a bid is admissible that covers the prior rights and the costs of the procedure (§ 44 (1) ZVG). In the partition auction, the rights encumbering the applicant’s share as well as prior or equal-ranking rights are to be taken into account (§ 182 (1) ZVG). Rights that are taken into account in this way and are not to be covered by payment remain in place (§ 52 (1) ZVG); land charges, rights of residence and usufruct can thus pass to the successful bidder and reduce willingness to bid.
- Bidding time and award. At the date, the value, the minimum bid and the conditions of auction are read out, after which bids are called for (§ 66 ZVG). A participant whose right would be impaired by non-fulfilment of the bid can demand security immediately after the bid is made (§ 67 (1) ZVG). It amounts to one tenth of the market value (§ 68 (1) ZVG). A co-owner need not provide security if he or she is entitled to a mortgage or land charge covered wholly or partly by the bid (§ 184 ZVG).
- Distribution. After the award, the court sets a distribution date (§ 105 ZVG). The successful bidder pays to the court (§ 107 (2) ZVG). If an entitled person cannot be paid out, the amount is deposited (§ 117 (2) ZVG). If the co-heirs cannot agree on the distribution of the surplus, it remains deposited until the division is clarified.
The rules on the partition auction contain no right of pre-emption of the co-heirs, as § 2034 BGB provides on the sale of a share of the estate. Anyone who wants to keep the property must bid at the date. The applicant co-heir may also bid.
Minimum Bid and Proceeds: When Is Auction Below Value Possible?
The award is to be refused if the highest bid, including the capital value of the rights that remain, does not reach half of the value of the property (§ 85a (1) ZVG). At the new date, the award may no longer be refused for this reason (§ 85a (2) ZVG). This means: the law secures a lower limit for the proceeds at the first date, but not at the second. In addition, an entitled person whose claim is not covered by the highest bid but would probably be covered by a bid of seven tenths can apply for refusal of the award (§ 74a (1) ZVG); this concerns above all mortgage creditors. Anyone who relies on value limits should therefore have their conditions checked in the specific proceedings.
Because of the uncertainty about the proceeds, the partition auction is regarded in practice as a means of pressure and as an emergency solution. The law promises no more than the ending of the community in the property.
Temporary Stay: How a Co-Heir Can Defend Himself or Herself
A co-heir who does not want the auction has one option with a tight deadline. At the request of a co-owner, the temporary stay (einstweilige Einstellung) is to be ordered for at most six months if this appears appropriate on weighing the conflicting interests; a single repetition is admissible (§ 180 (2) ZVG). The application must be made within a peremptory period of two weeks, which begins with the service of the order that points out the right to apply (§ 180 (2) sentence 3 in conjunction with § 30b (1) ZVG). In this way at most two stays of up to six months each are possible. The upper limit of five years (§ 180 (4) ZVG) applies to orders under § 180 (2) and (3) ZVG together and matters mainly for the stay to protect the welfare of the child.
The stay to protect the welfare of the child (§ 180 (3) ZVG) presupposes that the community includes, apart from the applicant, only his or her spouse, former spouse or partner; it therefore does not fit the typical community of heirs with several siblings.
Anyone who misses the period loses this defence. Documents served should therefore be opened completely and noted with their date.
Further Ways to Steer the Auction
- Withdrawal of the application. If the creditor withdraws the auction application, the procedure is to be lifted (§ 29 ZVG); if another co-heir continues on the basis of a joining, this does not apply to him or her. An agreement before the date can end the procedure.
- Joining. Anyone who joins himself or herself obtains the same procedural rights as the applicant (§ 27 (2) ZVG). The application should be made early enough that admission and service preserve the periods of §§ 43 and 44 ZVG; which periods are decisive in the individual case must be checked by the court or a lawyer.
- Bidding. Each co-heir may bid. Anyone who wants to take over the property should coordinate security and financing in advance.
- Sale by private treaty or takeover. A joint sale or takeover by a co-heir with an equalisation payment makes the auction unnecessary. The valuation of the equalisation payment is presented on a separate page.
- Sale of a share of the estate. A co-heir who wants to leave the community can sell his or her share of the estate by notarial contract (§ 2033 (1) BGB); the other co-heirs have a right of pre-emption on sale to third parties (§ 2034 BGB).
Costs of the Partition Auction
The costs consist of court costs, expenses and advisory costs. Under the fee schedule to the Court Costs Act (Gerichtskostengesetz), a fixed fee of 120 euros applies for the decision on the application for the order or on joining (no. 2210 KV GKG). In addition there is a 0.5 fee for the proceedings in general (no. 2211), a 0.5 fee for holding the auction date (no. 2213), which does not apply if the award is refused under § 74a or § 85a ZVG, a 0.5 fee for granting the award (no. 2214) and a 0.5 fee for the distribution procedure (no. 2215). The procedural fee and the date fee follow the fixed value of the property (§ 54 (1) GKG). The award fee and distribution fee follow the bid without interest including the rights that remain (§ 54 (2) and (3) GKG); for the award fee the value is reduced by the successful bidder’s share (§ 54 (2) sentence 2 GKG). The costs of the procedure are to be covered by the minimum bid under § 44 (1) ZVG. In addition there are the costs of the expert, public notices and lawyers’ costs under the Lawyers’ Remuneration Act (Rechtsanwaltsvergütungsgesetz), whose amount depends on the individual case. Because of the short periods and the protective applications, legal advice is usual in practice.
Taxes and the Partition Auction
The partition auction does not change the fact that the acquisition upon death is taxed according to the inheritance share. If no more than ten years lie between the acquisition by the testator, which is attributed to the heir (§ 23 (1) sentence 3 EStG), and the auction, a private disposal transaction under § 23 (1) sentence 1 no. 1 EStG may exist; the Federal Fiscal Court (Bundesfinanzhof) treats the loss of ownership through compulsory auction as a disposal within the meaning of this provision (judgment of 12 November 2024, Az. IX R 6/24, NJW 2025, 920); the case did not concern a partition auction, but the transfer is obvious, all the more since participation in a joint-ownership community (Gesamthandsgemeinschaft) has, since the Annual Tax Act (Jahressteuergesetz) 2024, counted as participation in the proportionate assets (§ 23 (1) sentence 4 EStG); if a co-heir is the successful bidder, he or she would presumably acquire the others’ shares, for which a new ten-year period then runs. This has not been clarified by the courts for the partition auction. For the successful bidder who acquires the property, real estate transfer tax arises; whether the exemption of § 3 no. 3 GrEStG applies on award to a co-heir is to be checked in the individual case; this has not been clarified by the highest courts. On the period see the article on the speculation period under § 23 EStG.
Where the tax treatment is unclear, a binding ruling (verbindliche Auskunft) from the tax office under § 89 (2) AO should be applied for before implementation. With a foreign connection, information in the other state may additionally be useful.
Property Abroad or Testator with Residence Abroad
The ZVG procedure concerns properties in Germany, because the local court at the place where the property is situated has jurisdiction (§ 1 (1) ZVG). For a property abroad, the state where it is situated determines whether and how realisation is possible; an adviser on the spot should be instructed for this. If the testator had his or her habitual residence abroad, it must first be clarified which inheritance law applies (Art. 21 (1) EuErbVO, the European Succession Regulation, with the escape clause in Art. 21 (2) and choice of law under Art. 22). Denmark and Ireland do not apply the Regulation; from the perspective of German courts they are treated like third countries. If German law governs the succession, the division follows §§ 2042 ff. BGB. More in the articles on division where there is foreign real estate, on bequeathing real estate abroad and on asset protection for real estate.
Typical Mistakes
- Making the application as a threat without knowing the land register. Rights in the land register can remain in place (§ 52 ZVG), raise the minimum bid and shrink the circle of bidders.
- Overlooking the two-week period for the stay. The peremptory period begins with the service of the order containing the instruction (§ 30b (1) ZVG).
- Not checking the fixed value. An incorrect value can no longer be objected to against the award (§ 74a (5) ZVG).
- Bidding without security. At the date, security of one tenth of the market value can be demanded (§§ 67, 68 ZVG).
- Regarding the proceeds as distributed. After the award the distribution among the co-heirs remains open; without agreement the dispute can continue.
Conclusion
The partition auction is a procedure provided for by law but elaborate: it solves the property problem, not the community of heirs. Anyone who pursues it or wants to defend against it should know the land register, value, periods and costs before the application is made. In many cases a joint sale, takeover by a co-heir or the sale of a share of the estate is the solution with less risk.
Frequently Asked Questions
Can each co-heir apply for the partition auction alone?
Yes. A co-heir needs neither the consent of the other co-heirs nor an enforceable title (§ 181 (1) ZVG). He or she must, however, act as heir of the registered owner and make the succession credible (§ 181 (2), § 17 (3) ZVG). A prohibition of division by the testator or an executor entitled to carry out the division stands in the way of the application or changes the route.
Can I prevent the partition auction?
Not permanently, but it can be delayed or averted in certain cases. Possible are the temporary stay on application within two weeks (§ 180 (2), § 30b ZVG), an agreement with the applicant, who can withdraw the application (§ 29 ZVG), or bidding at the date. A prohibition of division in the will (§ 2044 BGB) can exclude the division.
Is the community of heirs dissolved by the partition auction?
No. The property is realised, but the proceeds still belong to the co-heirs jointly. They must distribute it among themselves, if necessary by an action for consent to a division plan. Until then the amount can remain deposited with the court (§ 117 (2) ZVG).
What does a partition auction cost?
The court costs consist of a fixed fee of 120 euros for the order and of several 0.5 fees that follow the fixed value or the bid (nos. 2211 to 2215 KV GKG, § 54 GKG). In addition there are expert costs, public notices and possibly lawyers’ costs. No lump sum can be stated, because it depends on the value of the property.
Do the other co-heirs have a right of pre-emption?
No, the rules on the partition auction provide for no right of pre-emption. The right of pre-emption under § 2034 BGB applies only if a co-heir sells his or her share of the estate to a third party. Anyone who wants to keep the property must bid at the date.
Attorney Dr. Johannes Fiala and the law firm, with a focus on international inheritance law, tax law and asset protection in Munich, advise co-heirs and communities of heirs on the partition auction of estate properties, from examining the conditions of the application through defending against the procedure to the tax consequences. Dr. Fiala has published extensively on questions of emigration and asset protection. Contact the firm without obligation to have your individual situation discussed in an initial consultation.
