Buy land with cash, construction through KfW/NRW Bank

How to finance this now, I'm out. This is a financing question here.

Thanks anyway for your explanations/assessments :) Actually, I should start the thread from the beginning Still open then: - Buy the land cash and use it as equity because then you can rebuild the cash first? Ideally for better interest rates or better subsidies in 2025 (worst case: subsidies abolished) - Or fully finance and use equity, probably with commitment interest for the house construction? - Are 600k (150k land including fees, 450k remaining) realistic for the above requirements 120sqm + garage/parking space + outdoor area (pool/sauna not directly) Subsidy would currently be 150k KfW & max. 225k NRW.Bank for 450k (land is not payable via subsidy, so that would have to be financed via the "house bank") We want to end up with a max. 2k payment rate

- Buy the plot in cash and use it as equity, because then cash can first be rebuilt? Ideally for better interest rates or better subsidies in 2025 (worst case: subsidies abolished)

Crystal ball says: no idea what is better, since the future is currently blurry
- Or fully finance and use equity, but probably pay commitment interest for the house construction?
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Commitment interest probably about 3% p.a. you will have to pay. BUT: returns from capital investment currently exceed that for overnight money.
It’s a bet on the future. If you expect (significantly) falling interest rates, then wait with the financing.

- Is 600k (150k plot incl. fees, 450k remainder) realistic for the above mentioned requirements 120sqm + garage/parking space + outdoor area

Yes, it has already been said.

Subsidy would currently be on 450k the 150k KfW & max. 225k

Now I laugh heartily. You earn 80k NET per year. The subsidy limits of NRW.Bank are for a couple 61.3k GROSS per year (couple in income group B without children). So there is no subsidy there at all. The aim is to support low earners, not the well-earning middle class.

You only have the KfW left and it currently isn’t really much cheaper than a bank loan.

We want to end up with a max rate of 2k

Financing €450k then lies between €1,650 (with minimal repayment 1%) and €2,000 (then repayment somewhat over 2%).

So there is no funding at all there

You have probably looked at the wrong funding. This is about NRW.BANK.Sustainable Living and this one (I believe the only one) has no income limit, the same conditions apply here as for the KfW loan in the terms.

Financing €450k

Then it would be 2k but also without land. 1% repayment would probably make no sense, as it would be much, much more expensive in the long run. If we don't find a mixed calculation, we would have no choice but to pay the land in cash if we don't want a rate higher than 2k :/

Buy the plot with cash and use it as equity, because then you can rebuild cash first? Ideally for better interest rates or better subsidies in 2025 (worst case: subsidy abolished) - Or fully finance and use equity, but probably there are commitment interest charges for the house construction?

Whatever subsidy it may be. I would use the equity first, because it has to be used up first anyway in a financing. Buy the house, rebuild a bit during the waiting period with the good salary (for kitchen and such), then take out a loan for the house construction. Then you will probably avoid commitment interest charges. The plot is seen as equity in the financing. Go for it, whether it's 120 sqm or 140 sqm. That can become a nice planning project with the goal of creating beautiful living space. You just have to keep in mind that the house is only 6 meters wide inside. But for two people, you can design it quite modern and attractive.

You probably looked at the wrong funding. This is about NRW.BANK.Nachhaltig Wohnen and this (I believe the only one) has no income restrictions, here the same conditions apply as for the KfW loan in the terms.

No, it does not. But it also does not have a particularly worthwhile subsidy. Forgo the subsidy and the requirements (which also cost real money) and build a "normal" house without subsidized loans. This is probably cheaper at the moment. A 20-year fixed rate with a 20-year term currently costs 3.01% nominal at NRW.Bank. In addition, there is nearly 3.5% repayment.

Give up the subsidies and the requirements (which also really cost money) and build a "normal" house without subsidized loans

But we have the requirement from the development area anyway of EH40 with photovoltaics, green roof, flat roof – we can't get around that.
If you leave out the QNG, you still get 100k from the KfW (KfW124 but without worthwhile interest rates, if then the grace year on repayment, to have a bit more for furniture and such). The question is whether building between QNG and non-QNG saves so much that the subsidy is not worth it.

Basically, the finance advisor also said buying land and financing later would be ideal, but I am a bit worried if we hardly have any cash then and possibly have to rely on family. But I also don't know how realistic that is if we can finance all the construction costs and really only have the monthly installment to pay. We calculated 4000€ every month for loan + operating costs, car, insurance, groceries, etc. My partner would then have "only" 700€ left – we don't have a joint account and don't plan to – everyone puts 2k into the household account then.