Determination of the "monetary value" of a property in later financing

Great. I knew you could help me. Does anyone have experience with submitting bids in sales by the municipality? I am completely unsure whether you even have a chance if you bid significantly above the standard land value, but the market price is way off the charts (more than double the standard land value), and then my pain threshold including equity for a property is significantly exceeded.

The purchase price is used for the loan-to-value determination. Conversely, you could also say: Look, I paid 150, but other plots are going for 210, please use 210! The bank will still say no.

That can't be. Several financing experts said what I have repeated. We paid €60,000 for our plot. The standard land value is €120 x 1,449 sqm, currently about three times that. That would be nonsense.

Purely from a logical perspective, the purchase price should not necessarily be decisive, but rather what the property is currently worth. Because if you, for example, receive a property as a gift, it is still counted as equity. Otherwise, it should only be valued at "0" here. Without knowing for sure, I would, as a bank, use comparable values, such as how properties in the neighborhood are selling/sold, and probably use the lowest value from that. However, this is not a well-founded statement but just a matter of logic. As we all know, not everything always proceeds logically. And in an overheated market, as a bank, I would always tend to value it lower. I also consider the bidding process to be an impertinence. We once won our property at fixed conditions, which was already not a pleasant feeling, but the bidding process is more than impertinent...

Hmm. So it doesn't seem to be that simple after all. Even among the experts in the forum, opinions differ.

Only with current market prices of over 120% of the [Bodenrichtwert], there may be a large gap between the paid purchase price and the bank's assessment, which could then result in a worse interest rate. Difficult.

Can't be. Several financing experts said what I have reported. We paid €60,000 for our plot. The standard land value is €120 x 1,449 sqm is currently at three times that. That would be nonsense.

When did you buy? A few years ago? Cheaper within the family? If you bought with such a huge discount a year ago without a plausible reason, you have to provide a plausible story!

Great. I knew you could help me. Does anyone have experience with submitting bids for sales by the municipality? I am completely unsure if one even has a chance when bidding significantly above the standard land value, but the market price is beyond good and evil (more than twice the standard land value) and then my pain threshold including equity for a plot of land is significantly exceeded.

Please don’t be discouraged and always bid what you think is right. If 210 is too expensive for you, then bid less.