Condominium or "Single House"

Google "tiny-houses.de" or something similar. You can also build very cheap houses in Germany, of course you have to like that. The lowest price I’ve come across from a customer was just under €73K plus interior work in EL. However, the customer also annoyed every provider and went to trade fairs for years until he got his price.

On the other hand, in your life situation, I would do something completely different, namely only buy/build when you retire or it is foreseeable. A house that you build today and is as small as you plan is a risk. It will be built cheaply (not to say cheaply), but it’s supposed to last 60 years and maybe also serve as your retirement provision. Of course, it might be that in 40 years you’ll hit the jackpot because such small houses will then be very sought after, but I rather don’t believe that. Ergo, you will then lack capital and at the same time your income will decrease, so you can hardly build new capital.

Ergo: I would try to rent cheaply near your workplace in your area and build up further equity over a comfortable 10-15 years. This also has the advantage that you will look completely different to the bank then. Your "well over €2K" will quickly turn into an amount that just isn’t enough for a normal house with 100% financing, and above all, you would quickly be at a credit burden of 50% or more of the household net income if the mortgage lending value of the house even covers that. That’s definitely right at the limit (usually the maximum is said to be 40-45%) and every bank will want to be paid for that risk.

I am or we are far from such a value with 1.5 incomes, a bigger house, and 2 kids. Really far. So, my/our risk is significantly lower and on top of that secured by 2 earners. Which gives me/us enough leeway that I can easily go to my favorite pub on Tuesdays and "pay off" my Sky subscription there in the form of freshly tapped beer.

That will no longer be possible with your financing plans, unless you are really frugal otherwise. So rather stingy from morning to night.

Of course, you can do it, but it wouldn’t be my thing, so in my opinion you need to rethink and above all go to the bank to get reliable figures.

Best regards Dirk Grafe

Thank you for the various suggestions. I think I should not build too cheaply/stingily so that the house does not incur high repair costs prematurely.

But if I stay in rent and pay the cold rent to the landlord for the next 10 years, I will give away (without considering rent increases) 72,000 euros.
In the same period, my desired property will also become about 2% more expensive per year if you take the increase from 1990 to 2016 as a reference. Theoretically, my property will become more expensive than the money I put away even if the equity increases proportionally.

The bank appointment for Friday is scheduled, let’s see what they say.
I’m definitely looking forward to more ideas and suggestions.

Talk to them... then it will become clear what’s possible and if anything is possible.

But if I stay renting and pay the cold rent to the landlord for the next 10 years, I am giving away 72,000 euros (without considering rent increases).

The usual misconception. You actually "give away" only the net yield to the landlord, which is definitely under 5%, can also be zero or even negative – then you are living cheaper than you would if you bought/financed comparably.

According to your calculation, that is 3600€ over 10 years or 360€ per year or 30€ per month. Even if you assume a net yield of 10% (which is completely unrealistic), it is 60€ per month.

The only counterargument: your residential value is higher in ownership because, for example, you can remodel/renovate according to your own wishes.

In return for the rent you pay, however, you do get residential value. If you calculate the rent as completely given away, then you have to sleep under the bridge from tomorrow – there the rent resp. residential value is indeed zero. The comfort difference between the bridge and your apartment is roughly your residential value.

Best regards
Dirk Grafe

I am curious! Please tell us after the conversation what came out of it.

Best regards, Yvonne

3. Is there an aspect that I might have completely overlooked/forgotten?

As a civil servant, to my knowledge, you can be transferred by your employer at will, and according to general criteria (not married, no children) you will be the first to be affected by transfers.

Then you have a completely unsellable property (90 sqm single-family house – about as marketable nowadays as Nokia phones) and a large loan.

You pay 7,200 EUR cold rent per year? And you want to buy/build for 270,000 EUR?

That is an insane factor of 37.5.

With a factor of 15 - 20 such a thing is economically feasible, more is a zero-sum game but still okay.