Finance another house...

Hi,

With the gained distance and time, you can then properly renovate the house, even if it takes longer.

I guess that such a renovation would take longer during ongoing house operation than with a fairly freely accessible interior, at least that’s my experience from other areas.

Kermit

Could you imagine temporarily renting an apartment near your workplaces? It does mean paying rent again, but you wouldn't be living on a construction site that burdens you. With the gained distance and time, you could properly renovate the house, even if it takes longer. No more time pressure.

No, I can't imagine that. On the one hand, it's not so easy to find a rental apartment with a dog. The costs are also not to be underestimated, because I pay additional costs at both locations. Internet, GEZ, etc. All in all, I would still lose an additional thousand. The house also needs to be maintained, the lawn has to be watered and mowed, the hedge trimmed, paths swept, mail picked up. Then you would have to re-register, re-register the dog because of dog tax, re-register two cars, and so on.

Our house is not exactly a shell either, the attic is finished. We have a bedroom, each has an office, and the guest bathroom, the kitchen is also finished, just two floors below.

OK, so far it has been fine to buy a laptop for 2k, a nice trip to the Maldives. What happens when you have to finance 500k and then have kids (net income even less due to possible part-time work)?

How do you repeatedly come up with the absurd idea that +500k€ would have to be financed!?

Even if the old house were kept, there would be additional rent income or you have to explain to us why a house with an estimated value of 340k€ should have a living and/or rental value of zero!?

That is absurd!

Are you willing to consume less, can you handle the expenses and missing net income? I would consider undertaking a bigger project. The banker in me says yes, you can manage it, the average Joe says don’t overestimate yourselves

You are not a banker. The old house has a current and immediately realizable market value of at least 240k€ (70% of the stated purchase price), if the information from the OP is not completely made up. There are 290k€ financed, a small part of which is paid off, including special repayments maybe 25k€, leaving 265k€ - so that can be roughly balanced out in 5 seconds if the house should not be unsellable for some ominous reason.

To break even, you therefore have to get 265k€ plus prepayment penalties for the house.

Only the new house needs to be financed - with the salary and the equity already present (currently invested in the house!) that should not be a problem. At most a technical one, because there will have to be interim financing.

: find yourself an architect who plans the renovation. You can afford it.

Best regards
Dirk Grafe

the already existing (currently tied up in the house!) equity

Clarification question: The net assets are zero, as you yourself write in the paragraph above?

Good Lord – the net worth is zero if you sell the house for about €280K (€265K + €15K prepayment penalties). If it is worth €340K and sold for €340K, you suddenly have €60K equity in hand.

Where do they come from? Do they fall from the sky? No, they are present and built into the house because less was financed than the house is worth. Really that hard to understand?

Best regards
Dirk Grafe

Would it possibly make sense to pay an architect who creates a complete concept/renovation plan with all costs and then tries to expand the potential buyer pool? Maybe buyers are more willing to engage with the property if a) the overall concept is recognizable and b) the rough cost framework is established? Then try to break even or accept a slight loss. Otherwise, Dirk Grafe is right. The house certainly has value. You could probably sell it within a few weeks for 200,000. Understandably, you do not want that! What price per square meter are we talking about in the immediate vicinity of your work? (up to 20km)