Construction costs are currently skyrocketing

Wrong perspective: as long as they are below 2.5…/3.5%, they are low. You must not only take your little time period when you are interested in yield curves. 5 years is practically nothing!

Correct. Just to bring some proportionality into the discussion: Our soon-to-expire fixed interest rate is at 3.03% interest (with 4% initial repayment), then ran for 10 years. And even that we saw and still see as a low interest rate. Therefore, I also do not assume that interest rates will fall again. The forward loan has been applied for... In addition to the topic of continuing to service the loan with only one salary: that was still standard back then and one was clearly pointed out to in the financing threads here in the forum. With today's prices (also resulting from the often experienced luxury demands here!) it is of course more difficult...

How glad I was about 2.5%... I would have been happy if I had benefited from 0.xy or 1.xy now with a forward loan. But it isn't. Nevertheless, I know that would be an absolutely low interest rate. The generation that financed in the last 8 years can count themselves lucky. Still not the normal level of interest. Don’t complain!!!

It is of course more difficult at today’s prices (also resulting from the luxury demands often experienced here!)

That’s how it is. Those who benefit from 0.xy afford nice-to-haves and take this demand as standard. The forum is poisoned with oversized pantries (backup …), galleries and air spaces, children’s bathrooms and double garages. Nobody is talking about owner-occupied apartments (ELWs) at the moment – two months ago it had to be done (KfW funding)... It’s time for those wanting to build to get back down to earth. Then no one needs to complain that they can’t pay for their third home office room. ;)

At the end of 2009, I took out a forward loan for my condominium at 4.5%. At that time, I had come from something like 6.x%. I was really thrilled about the 4.5...

I think right now is really a bad time? If you look at interest rates over time, they usually move rather zig-zag for several months. In recent weeks they have gone up so steeply, at some point they would have to go down again, judging purely by past patterns.

To answer your question, one would first have to define which interest rate we are talking about: at 60/80/100/105% loan-to-value ratio. For us, the largest part was financed at 100-105% loan-to-value ratio. Occasionally, a little equity was contributed beyond the additional purchase costs. In this area, I see interest rates settling again in the medium term at 3-5%. In the classic 80% loan-to-value ratio, it should settle around 2.5-3.5%. It depends on how strong the interest rate increase will be from the ECB and how inflation will settle. If Ukraine/Russia calm down again, we should see 3-4% inflation. In this respect, I see no signs indicating that we will see 0.x% or 1.x% again for 80-100% LTV ratios. Currently, KfW-124 with 1.92% for 10 years is actually again one of the most interesting (and we came here from 0.75% just under half/three-quarters of a year ago).

I definitely see the real estate market bursting for new projects. Unfortunately, many dreams are breaking. Financing costs have now doubled in 24 months for construction costs. Previously €1000 installment, now €1500 installment. And only that counts. The wage increase will probably go to food, fuel, and everything else.

105% loan-to-value ratio? Is that the whole wannabe-get-rich-quick-with-real-estate YouTuber scene? Those are probably rentals, right?

I definitely see the real estate market bursting for new projects. Unfortunately, many dreams are breaking because of that.

For under 40s, it's definitely no longer easy to represent without inheritance. But there are plenty who receive a financial boost from their family. That will continue for some time - but maybe then you won't see fireplaces, lift-and-slide doors, large windows, venetian blinds, electric shutters, double garages, etc. as often anymore. And the living space will just be reduced a bit. People just have to tone down their expectations a little again. We could have easily spent 150k less, but we didn't want to ;)