Community of heirs

A community of heirs (Erbengemeinschaft) arises automatically when a deceased person leaves several heirs. All heirs jointly own the entire estate – nobody owns anything individually.

The problem:

• Every decision requires the unanimity of all heirs
• One heir wants to sell the house, the other wants to keep it → deadlock
• Management (repairs, letting) must be decided jointly
• Every heir can demand the "partition" (dissolution) at any time

Solutions:

✅ Will: clearly specify who gets what (prevents a community of heirs)
✅ Partition agreement: all heirs agree on who gets what
✅ Buy-out: one heir takes over everything and pays out the others
✅ Sale: sell everything and split the proceeds
❌ Partition auction: last resort – the court auctions off the estate. Often at a loss.