Construction project 400k: How much to add floors?

I don't see it quite as radically as you do, but I also expect further appreciation of the land alone. The foreseeable rising rent is also a reason for the construction project. Nevertheless, primarily it is intended to be owner-occupied living space.

Up to my pain threshold concerning distance, it is now 250 EUR/sqm. Smaller plots cannot be obtained for the reasons mentioned.

Sharing is unfortunately rarely possible. A semi-detached house as a "last resort" is already being discussed, but only if it is truly unavoidable.

Which calculator can you recommend? It's certainly not a nice topic, hence this discussion

What equity would be needed for significantly better conditions? The problem at the moment is that land prices are moving away faster than money can be saved. 10-20% growth p.a. has been seen here in the surrounding area over the last 10 years, with no end in sight.

As said, you have to estimate it better yourselves.

It's not done with the pure installment either. You also still have the ancillary costs for the house. That can easily be 1400 installment + 600 ancillary costs (with provisions, electricity, water, etc.).

And do you really want to pay it off for that long? If yes, I don't have much economic understanding for that, because your income is high and you haven't taken out much credit. If not, I have even less understanding for that, because then you are paying for a long fixed interest period that you don't even use. Overall, your financing is a relatively bad example to serve as a "role model" for the OP. With your > 250k equity, you generally got offered favorable interest rates, even for 30 years.

Most of the time, it doesn't make financial sense to reduce your risk to zero. This applies to financing just as much as to insurance.

Aside from how interest rates might be in 10 years, Caspar raises a very important point. It's not just about interest rate change risk or economic factors. With a fixed interest period >20 years, in the best case you never have to speak to a bank again until the house is paid off.

1. Your professional situation, your salary structure or that of your wife, etc., won't be reassessed with a sufficiently long term.
There are many reasons why salaries might simply disappear without being compensated. Then you're glad if the bank approaches you only after 11 years and not in the first year regarding the follow-up financing.

2. Your house and land do not have to be reassessed.
For example, if you had financed a condominium in Duisburg Marxloh 10 years ago and would now like to apply for follow-up financing, the current value of the condominium would be €0.

So you see, it's not always about saving interest.

Wrong. You must report any significant change in your financial situation regardless of the loan term!

You see, it’s not always about saving interest.

True. For you, it’s about peace of mind and "German Angst".

I am glad about the lively discussion, but we are slowly drifting a bit.

Do I understand correctly that in principle
1. everyone unanimously advises against planning a higher budget?

2. significantly better conditions are only to be expected with 40% equity, where realistically I will not reach in 5 years?

Do you even see possibilities to realize the construction project?

Regards

Wrong. A significant change in your financial circumstances must be reported regardless of the loan term!



Correct. For you, it’s about peace and "German Angst".

@Change in financial circumstances: Yes, in theory that’s correct. In practice, no one notices, so you have a correspondingly long time to counteract as long as you can pay your installment.

@German Angst: The Americans who lost their houses a few years ago and now live in their SUVs would have been very happy about the attribute or the long fixed interest period.

But this is not supposed to become a discussion of opinions here.

I am glad about the lively discussion, but we are slowly drifting off topic.

Am I correct in understanding that basically
1. it is unanimously advised against planning a higher budget?

2. significantly better conditions are only to be expected with 40% equity, which realistically I will not reach even in 5 years?

Do you even see possibilities to realize the construction project?

Regards

No, even with a 90% or 80% loan-to-value ratio, the conditions are significantly better than with 110% financing.

Basically, it is like this: You have €4300 available monthly, of which the bank deducts €1000 for the first person in the household, and €400 each for all further persons as a flat rate for general living expenses. (This varies from bank to bank, but this is basically the principle.) For each car, another €500 is assumed, plus further fixed obligations such as alimony or similar, if applicable.

Let's assume you don’t have those.
So initially, you have €2000 per month left for the property. From that, the bank then deducts a flat rate for incidental costs, which would be €360/month for your slim 120m², for example.

Now we still have €1640/month left for financing. Since you don’t want to plan too tightly, let’s assume you are willing to pay up to €1400 per month in annuity.
Assuming you can actually keep the total costs at €400k (which is very unrealistic), you would have to come up with at least €33k yourself for the incidental costs.
With then 100% financing, 30 years fixed interest, 30 years full repayment term, you ideally get 3.24% and have a monthly installment of €1740.

So no, with the current income situation a higher financing is probably not feasible.
The land is simply too expensive.
So either go somewhere cheaper or accept less land, i.e. a semi-detached house or even a townhouse.

Regarding the discussion about fixed interest periods: Knallkörper is right, Germans very much like to buy security, which is why there is the appropriate insurance for everything and everyone here. It is a very personal decision which risk one is willing to bear. The 80% security is often financially significantly more reasonable than 100% security. Many people still want it and pay the premium. Both are justifiable, everyone has to decide for themselves.