400,000 Euro total budget too little??

The rate is calculated so that we could still manage it with my husband's income without living only for the house. Of course, it would be tight then. The plan is that I would stay completely at home for a maximum of two years (possibly only one year, I don't know yet) and then go back to part-time work. A second car is even included in our rate, which we don't have yet. And we have also budgeted 300 euros house money as reserves. Likewise, additional costs for waste disposal, street cleaning, sewage, etc. Our financial advisor advised us to go for a 10-year fixed interest period, as the additional costs for 15/20 years are not worthwhile. We plan special repayments of at least 5,000 to 10,000 euros per year so that the lower remaining sum could offset a possible interest rate increase somewhat. At least, that is the recommendation.

Ah sorry, you haven't written anything specific about your income.

Still: Sondertilgen means that you are also willing to save. Then I wonder why you haven't been willing to do so until now or why you have so little equity? Are you really willing to change your lifestyle?

We were able to secure 25 years at an effective interest rate of 3.20. This also corresponds to our term, and the rate is quite manageable. If we then still make special repayments, with €2,000 special repayment we are finished after 21 years. But I don’t want to rely on that and prefer planning security.

And just so you have an idea: We have a total volume of €480,000 (Kfw 70 house with 185 sqm living space, 8 ar plot (93,000 €), finished double garage, outdoor facilities, incidental costs, kitchen, furniture, €15,000 specification buffer...) and equity of €230,000. In recent years we have had an annual savings rate of approx. €30,000 and still I prefer to calculate pessimistically, although I do assume that we can and will manage more than the €2,000 special repayment per year indicated by me above.

@Admins: Sorry for the multiple posts, but unfortunately I can’t edit. However, the last posts may of course be merged.

I took the liberty of copying the incidental construction costs list from Bauexperte:

1. Plot of land

5% property transfer tax - varies by municipality
possibly broker fees, approx. 3.5% of the plot price, varies by municipality
approx. 1.5% notary fees, calculated from the plot price
3 x entries in the land register (1st priority notice of conveyance, 2nd transfer of ownership, 3rd registration of the mortgage)

2. Financing

possibly consulting/closing costs for financing, approx. 1.5% of the total loan amount
approx. 0.25% commitment interest, based on the loan amount

3. Construction preparation

approx. €2,800 - €3,200 surveying services (qualified site plans / height survey / staking out / building survey)
creation of soil report, approx. €1,200
provision of connections for construction water / construction electricity, approx. €6.00 - €8.00 rent for standpipe/day,
approx. €300 rent for construction electricity meter
fees (for house number, drainage permit, building permit), approx. €1,000 - €1,500, varies by municipality
fire / builder’s liability insurance approx. €80 - €150/year, depending on insurance company

4. Earthworks

removal of excess soil (normal ground conditions) for basement, approx. €1,500
internal development (waste/ rainwater pipes), approx. €2,500 – depending on pipe route
inspection chambers, soakaway or infiltration shaft, approx. €1,900 - €2,200
reserve for additional foundation costs approx. €8,000

5. House connection costs

electricity/gas/water/telecom, connection to the sewer system, approx. €8,000 - €8,500 - varies by municipality

6. Fees

acceptance of drainage pipe, approx. €150 - varies by municipality
chimney sweep (acceptance of chimney / gas system - note: fee is charged twice), approx. €200 - varies by municipality
cadastral office (transfer of surveyor’s data to the property map), approx. €150 – varies by municipality

Total approx.: Euro 35,000 – 40,000
Important: costs for painting, floor coverings and outdoor facilities are not included in the above list!

And we have also calculated 300 euros of maintenance fees as reserves. Likewise, additional costs for garbage collection, street cleaning, sewage, etc...

Our financial advisor recommended going for a 10-year fixed interest period, as the extra costs for 15/20 years are not worth it. We plan to make special repayments of at least 5,000 to 10,000 euros per year, so the lower residual amount could at least partially offset a possible interest rate increase. At least that’s the recommendation.

So without knowing your actual net income, your numbers seem a bit naive. Sorry for that.

You need 380,000€ and might get it at 2.9% interest?
That means a monthly payment of 1,550€ with a 2% repayment rate. Assuming a 5,000€ special repayment per year.
Your monthly loan burden would then be 2,000€ per month.

If you manage to keep that up consistently for 10 years, you will have a remaining debt of 240,000€ afterwards. Now, if you assume an interest rate of 8 or 9%, your interest rate risk is enormous.
Sure, it’s a gamble like in the stock market... but wouldn’t security be worth a few extra euros to you?
How many banks have you approached so far, or have you asked an independent broker?

Our house bank offered us a 60% financing at 4% for a maximum of 15 years in 2011. Our broker got the same loan from the same bank for 3% over 20 years.
Comparing is definitely worthwhile.

Moving on to the monthly costs:

In addition to your 2,000€ loan costs, roughly 600€ per month in fixed costs for electricity/gas/water/garbage/insurances/mobiles/telephone/internet.
Now we’re in a range where your husband’s net income really has to be good.

You plan to have 2 cars, where I roughly budget 200€ for fuel, 300€ maintenance fees... you can no longer manage that as a family.

That’s 3,100-3,500€ per month WITHOUT luxury, without vacation, without a zoo visit.

Childcare will also be an expensive story... I can sing a song about that currently... my wife’s salary, who recently returned to part-time work, goes completely to extra commuting costs and childcare... 2.50€ remain for a waffle at the zoo.

I certainly don’t want to discourage you, but I would advise you to really think this through carefully.
We also didn’t have all costs in view before signing... and I am surprised every month when I look at the account.