Construction costs are currently skyrocketing

Just out of curiosity: What do you think, how much will prices for new builds fall and where will interest rates be in a year?

I believe it’s relatively predictable that interest rates will definitely not be cheaper than they are today. The interesting part will be how strongly the ECB will have to react – the pressure from the FED and other banks does not leave it as an isolated actor. But that would only be the lower end – the outlook for the future is currently quite, quite bleak, so interest rates will likely continue to move upward. Take the guest topic, that’s coming..

The consequence: the directly available volume of money for a purchase/build – i.e. equity plus loan amount – continues to shrink because the cost of money increases over the term. Due to inflation, the share of household income affordable for loans/housing also shrinks – even now, the current burden is simply no longer feasible for many.

This means a further drop in demand. Or also a shock. I always like to refer to the number of threads/project presentations here in the forum. It’s probably slowly reached zero. And if so, we’re talking about incomes of €7,000 net and more – and even then there are great doubts whether the project is a good idea. So we have completely left the middle class behind and reached the lower upper class encountering problems buying. Unless they have larger equity shares in the millions..

For new builds – or rather new build prices – this will probably take the longest. Before that, things tend to start with land. The bubble prices are no longer sustainable. To even get an offer for the extremely collapsed demand, the construction industry will have to adjust. It has not really been notable for innovation so far. Since the global consumer market is currently quite collapsing, international transport will also become easier again sometime next year. Then the German timber price can no longer decouple from the world market, and raw materials will also come under pressure again.
Otherwise – for new build projects from developers I have already seen price reductions in marketing, small (€30,000), but at least. At the price asked, you have to look a very long time for a crazy buyer – especially when 10, 20 others are trying at the same time..

FOMO is over and for many it is ending harshly – loans are no longer approved. The cycle continues as usual – we’re getting a buyer’s market.

It usually starts with the land first. The bubble prices are no longer sustainable.

I had that thought recently as well. My girlfriend was still on a waiting list for a development area in Hegau. The municipality (<5000 inhabitants) apparently has several new development areas in the pipeline that will be buildable in the next 2-3 years. When I combine that with the fact that plots of land are currently being returned en masse, I am curious to see whether, in the medium term, selection procedures and urgent building requirements will disappear again in most regions.

Germany is sometimes really funny. Speed limits are taboo, but letting tenants freeze is being discussed?

I can very well imagine that this screw will come too. Likewise the Sunday driving ban. And honestly.... I think the government isn't doing such a bad job. They have already been pushed into the cold water with the tasks they now have to handle. I have serious doubts that things would have gone better with the CDU. People somehow complain about every government, but no one really wants to do it themselves and realize how you start with a lot of commitment and then first have to fight windmills. Anyone who has done voluntary work will know what I mean.

A reasonably normally committed teacher works over 40 hours. A full-time position consists of 27 teaching hours. In addition, there are supervision duties, preparation and follow-up, etc. It is no coincidence that many teachers voluntarily reduce their hours. The peak workloads are quite high. In addition, many, if not most, are also deployed outside their subject area. I imagine that is very stressful when I suddenly have to teach a subject in which I am not confident myself. So, in my opinion, the teachers have my understanding.

One must not forget: outside the bubble, an hour is more than just 45 minutes and the vacation is at most 30 days.

Please don't forget: outside the bubble, the hour has more than just 45 minutes and the vacation is a maximum of 30 days

Please don't forget that the quarter before the hour counts as teaching time and especially during pandemic times, almost every break had to be supervised. By 1 o'clock, you haven't gotten rid of all the students yet, so four of the six hours daily easily last 60 minutes each. But you're right, the time without teaching is a dream. In my opinion, it compensates for the significantly higher stress level compared to a "normal" job.

Please don't forget: outside the bubble, the hour is more than just 45 minutes and vacation is a maximum of 30 days

Mornings work, afternoons free. And off to the pub :eek: