Construction financing: sensible or nonsense?

Maybe it is different now, but when we renovated a few years ago, the BG also wanted to regularly know who was doing what... If it is still like that, and I assume it is, this cost is forgotten by everyone who does a lot of work themselves. If you are not careful, a few thousand euros can quickly add up. In our case, it was in the low three-digit range because I wrote to the BG beforehand and asked for explicit confirmation of insurance coverage for family members. Since this confirmation was not granted, I stated on every letter that I would not pay contributions for the persons as they are not insured.

Yes, that is a very good point! In my construction consultations and also in construction supervision, the builders usually know nothing about it. House sellers seem to be completely unfamiliar with the mandatory builder helper insurance required for self-performed work. However, registering the helpers is mandatory according to the Building Code, and fines of up to 2,500 EUR can be imposed for non-registration.

First of all, thank you very much for the numerous answers and information.

Generally speaking, I had already kind of expected that.
We are increasing the budget for the outdoor facilities from 5 to around 10k.

As for furniture. I don’t know what some people do when they move into a new apartment or house, but when I read that some spend 30/40/50k on new furniture, I start to hyperventilate. I don’t understand the point of completely refurnishing. Of course, you need some furniture, but it stays within limits. We have calculated our purchases and don’t even come close to those amounts. But we are not completely refurnishing either. Why should we..

Ich warte ja immer noch auf die Antwort, wann der TE neben seinem Job das alles machen will.

We are not the kind of builders who want to do everything quickly and move into the house within 9 months. We are currently planning 18 months for the construction period. If it takes longer, it takes longer. For construction times, I consulted my future father-in-law. He has already built several houses. Roughly every day after work (4:30 pm) until 9/10 pm. On weekends correspondingly earlier. Picking one day a week where you don’t do anything, but really nothing except lying on the couch. That’s how he always did it and it worked pretty well. It’s hard to give exact times, but that’s roughly the idea. I am aware that this is not easy, but there are people who live for this and enjoy doing it. I am one of them.

Somewhere the question came up about my health condition.
I’m not an elite athlete, but I keep fit.
In short: Strong as a bull, with sense and reason, I bench press 100kg.
*please don’t take this too seriously*

Wir haben unsre Sparrate so angesetzt, dass das was übrig bleibt genau dem entspricht, was bei unsrer maximal verträglichen Rate (+Nebenkosten) auch bliebe, um zu testen, ob das tatsächlich klappt.

That’s also roughly what we did.
1,200,-€ savings rate
250,-€ rent including utilities (electricity, oil, water) currently.
= 1,450,-€

Max. loan about 1,000,-€
400,-€ additional costs
= 1,400,-€
If in the end it becomes 1,500,-€, then so be it.

Somewhere the sentence came up that this is not purposeful. To be honest, I don’t understand that. We have been getting used to the "burden" for 1 ½ years and are simultaneously saving more buffer. We already have the equity.

The rest of what remains from the salary is not gone either. Both of us still have enough in our accounts, but we won’t touch it for now. It’s not huge sums, but it’s 5-7k overall.

If I haven’t answered a question, I’m sorry. It wasn’t intentional.

Thank you.

Phew... you are basically doing most of it on your own (masonry, drywall, electrical, probably also painting). Then I wonder what could still cost 265k€... do you pay the friends or family for the work time? Or is everything just material cost?

I’m not familiar with this! But on the one hand, I always hear that the materials aren’t that expensive, but the working hours are.

Then, if you bring your own people, suddenly the materials are the expensive part...

Quite strange.

We don’t have a final cost breakdown yet, because we are only 99% finished with the floor plan, but it will probably be around 265k. Friends of ours are currently building about 15km away, and another friend built two years ago. They also did about the same themselves as we plan to do. They were a bit below that, but better safe than sorry.

And I see it the same way as you, but everyone has to decide for themselves how they plan their costs. I just wanted to get an assessment from the forum here. Ideas, advice, food for thought. What eventually ends up on the sheet remains to be seen.

I would structure the financing so that it is largely paid off after 20 years. This is achieved through a correspondingly high repayment rate.

Loan amount: €310,000.00
Disbursement date: 29.11.2018
Payment frequency: monthly
Duration of fixed interest period: 20 years
Fixed nominal interest rate: 2.00% per year
Initial repayment rate: 2.65%
Amount of installment: €1,200.00
Amount repaid at the end of the fixed interest period: €201,444.60
Outstanding debt at the end of the fixed interest period: €108,555.40
Total interest paid: €86,572.39

For me, the outstanding debt of €108,555.40 would be a reason to increase the repayment rate:
Initial repayment rate: 4.00%
Amount of installment: €1,550.00
Amount repaid at the end of the fixed interest period: €304,623.38
Outstanding debt at the end of the fixed interest period: €5,376.62
Total interest paid: €67,393.61

If you can afford the installment of approx. €1,500, this would be my favorite.

Thank you very much for the concrete example.

When it comes to furniture. I don’t know what some people do when they move into a new apartment or house, but when I read that some spend 30/40/50k on new furniture, I start to hyperventilate. I don’t understand the point of completely refurnishing. Of course, you need some furniture, but it stays within limits. We once estimated our purchases and don’t even come close to those amounts. But we also don’t completely refurnish. Why should we..

Exactly. I always wonder the same when people talk here about having to pay tens of thousands of euros for furnishings when buying/building a house. I always ask myself, were there absolutely no furniture beforehand or was it still the last junk from the first student apartment.