400k house estimated - became a 470k house / an experience report

Back to the topic:

I definitely consider the costs realistic and not exaggerated at any point, although I don’t know the price structure "in the countryside." For us, the basic problem was comparable. We live in the outskirts of a metropolitan area. The 700 sqm plot cost €260,000 (whereas the standard land value has already increased by €60 per sqm since the purchase).

The house itself is not huge (160 sqm of living space) and has a 55 sqm usable basement and a solid double garage with storage room (6 x 9 meters in total). However, the equipment was quite expensive and we also followed the motto to do it "properly" right from the start. The house is built from bricks, has controlled residential ventilation and photovoltaics, except in the kitchen, bathrooms, and basement there is parquet everywhere, lots of glass all around, KNX with alarm system, RC3 windows, a guest bathroom and two full bathrooms, air conditioning, clay plaster, masonry heater etc. Heating is with gas. The outdoor facilities are also quite high-quality, although I did a lot myself there as well (including a sensor-controlled irrigation system).

Floor coverings, painting, chimney construction and garden we did completely ourselves (except for the paving work).
Cost-wise, house, garage, kitchen, and garden cost €570,000.
Since the plot was on a slope but we wanted a level garden, this was a major cost driver that was not planned like that and caused around €25,000 in additional costs (retaining wall, extensive soil removal).

Somehow, it is madness that a house of normal size including land cost well €870,000 and we have just started saving for new furniture. Nevertheless, we feel incredibly comfortable and find that the monthly burden is definitely matched by an appropriate value.

Wait until you have moved in. Then the perspective is different...

Somehow it's crazy that a house of normal size including the property cost a good €870,000 and we've just started saving for new furniture. Still, we feel incredibly comfortable and believe that the monthly burden is definitely matched by an appropriate value in return.

First of all, all good "treat yourself"!

On average, I find there's a bit too much complaining going on or acting surprised that a normal house would cost that much and that the average Joe consumer can't afford it anymore.

This is not directed at you directly , I've just taken your post as an occasion.

Features like controlled residential ventilation, air conditioning, a hefty double garage with sectional door, KNX, external venetian blinds, 2-3 bathrooms, fireplace, hiring a landscape gardener, leveling the property with walls, etc. – all that is not average Joe stuff. That is upscale to partially luxury. Decades ago, the average Joe consumer couldn't afford that either.

And anyway, who actually is the average Joe consumer? Sometimes it sounds to me as if it is normal and a fundamental right for everyone with a vocational profession to have a claim to a single-family house with a garden. New construction. Back then, comparable people couldn't afford that either. Just look at your parents’ generation. They bought old dilapidated houses and renovated them themselves. Over 2-3 years with family and relatives, living on a very modest level. New construction was only affordable for those who earned accordingly or whose parents provided the land. It was no different. And back then, loan interest rates were between 6 and 12%.

So yes, the energy saving ordinance has made things more expensive, and yes, prices have risen also due to the shortage of land. But honestly, if you take the costs of a single-family house including financing costs until full repayment and put that into relation to today's incomes, I am sure we are perhaps a bit above the line but not as far off as it sometimes sounds. Only the demands have also risen.

Don't get me wrong. I believe, treat yourselves if you can afford it. But don’t let yourselves be fooled by the illusion that "everything was better (and cheaper) back then."

Don’t get me wrong. I think, treat yourselves if you can afford it. But don’t deceive yourselves with the illusion that "everything was better (and cheaper) in the past."

You are right with your statements about luxury – but not with "it was expensive back then too." Building equity through saving is no longer possible today – and ETFs are a different risk category. High interest rates back then also came with more inflation and especially high collective bargaining agreements. Collective bargaining coverage is another indicator that shows you are mistaken. The repeatedly published figures on loan amounts, the age of borrowers, and equity also show that the requirements have massively increased alone in the last 5-7 years. Sure, 30-40 years ago a good income was necessary, but not like today with two dual-academic incomes, each working almost full-time.

That's how it looks, but the huts are getting bigger and more expensive. Reason: the 30-year-olds are inheriting like crazy, sometimes they just get 500k from their parents handed over. It's currently the heir generation in action. I see and hear it daily

Well, lucky is the one who inherits.

As I already said, we are certainly a bit above the line, yet I do not agree with everything.

Building equity through saving no longer works today – and ETFs are a different risk category.

No one claimed that you should invest in ETFs. And yes, compound interest is missing, but no one is stopping you from setting up a standing order to the savings account.

High interest rates back then also came with more inflation and especially with high collective wage agreements.

Yes, also there. Back then high interest rates, high inflation (which also means cost of living increases). But also the financing costs were high. You just have to consider how the possible financing amounts look if you have to calculate with 1-2% repayment and 8% interest. So an annuity of 10%. For every 1000 EUR installment, you would then get a 100,000 EUR loan. Today interest rates are cheap and houses more expensive. And that's why I explicitly wrote to put it into perspective. Back then you paid more to the bank, today you pay it equally to the craftsmen.

Collective agreements are another indicator showing that you are wrong.

I don't know what you want to say with that.

Also the repeatedly published figures on loan amounts, the age of borrowers, and equity show that the requirements have massively increased in the last 5-7 years alone.

Requirements for what? Isn't that perhaps simply the consequence of wanting to afford more and more?

30-40 years ago a good income was certainly necessary too, but not like today two double-academic incomes with almost two full-time jobs.

If only double-academics with two full-time jobs could build today, it would be much emptier here. By the way, I am not really an academic (employee) and my wife has a "normal" vocational profession. And we're managing... at least so far.