Construction financing questions for row houses

Good day,

My name is Thorsten Nielsen, and I am considering having three terraced houses built in Weiden. About myself: I am 50 years old, happily married, self-employed for almost 15 years, with a household net income of 2200 euros, equity of about 140,000 euros, and we own a fully paid-off house with a market value of 350,000 euros. Our household net income could easily be increased to 4000 euros within a few months, as I have only been working part-time in my self-employment in recent years.

Details about my construction project: The plot is located in the vicinity of Weiden, has 1000m2, and can be purchased for about 160,000 euros. The three terraced houses could be completed by a developer within a year for just under 700,000 euros, and the projected rental income amounts to 3300 - 3900 euros gross per month, based on statistical averages to determine this income according to local customary rents.

Is this construction project manageable with my financial means? And how could I finance this construction project?

I would appreciate any advice!

Addendum: My son still owes me an additional 60,000 euros due to his [Auslandsstudium], which he will repay to me over the next three years.

Unrealistic. No bank will finance that. Most likely your own bank that knows you.

Unrealistic. No bank will finance that. Most likely your house bank that knows you

Despite over 500k euros of private assets, and the resulting rental income?

Despite over 500k euros in private assets, and the resulting rental income?

Yes. The house is an illiquid asset and you do not generate income from it. What matters are the actual incomes. Low self-employment combined with rental income that could fail is very risky. Banks do not like to finance that.

Yes. The house is an illiquid asset and you do not generate any income from it. What matters are the actual earnings. Low self-employment combined with rental income that could fail is very risky. Banks do not like to finance that.

But in case of risk, couldn’t the terraced houses including the land and our house be auctioned off, which have a significantly higher market value than the loan amount?