Financing Check: Building a House in 2.5 Years

Regarding the house price, I have acquaintances who have just built on the outskirts of Hamburg (Neugraben), their location and house are very similar to what we could imagine, and they managed with 350k without incidental costs and soil/painting as do-it-yourself. The plot was 120k. No idea if that is realistic, I went through a few example calculations with a local developer, they are all in that range. Where does the 50% surcharge come from? Medium equipment is more than enough.

350 thousand euros and about 75,000 incidental costs, you’re at 425 thousand euros, and then about 15% price increase in 2.5 years, you’re at about 500 without the plot. That’s how simple the calculation is.

350,000 euros and about 75,000 additional costs, you're at 425,000 euros and then about 15% price increase in 2.5 years, you're at about 500 without land. That's how simple the calculation is.

Calculation error. You took 15% for the entire period, you surely mean 15% per year, right? That would be 650,000€ over three years.

Understood. Then I wrote that incorrectly in the initial post. My 350k was also without additional costs. Since probably our entire equity will go into the additional costs, I only included the actual house price. So yes, I currently calculated 350k for the house, 60k-70k additional costs, and 150k for the land, so 560k.

Where do you get the 15% p.a. increase in construction costs from? In recent years, it was on average 5%.

If it were up to Bookstar, always take the ridiculously high amount. And if it can be done cheaper, it certainly means nothing. You can ignore that. Especially since no one has a crystal ball. Your strategy is correct and you will have to wait and see what actually happens. Save as much as possible, then you will have the most options.

Have 5% per year, therefore 15%

Friends who have now built on the outskirts of Hamburg (Neugraben), their location and house are very similar to what we could imagine, and they managed with 350k excluding ancillary costs and ground/painting as own contribution. The land was 120k. No idea if that's realistic

I’ll speak from my experience: I also consistently downplay the total costs of our project when talking to family and friends. I want A) not to endanger the friendship, because non-homebuilders would otherwise be overwhelmed by the amount and understand the figure completely out of context, as if we were now somehow better. Also, I want B) to keep resentment, envy, etc. in the family low; inheritances come sooner or later, and then I don’t want to be the one who "already owns the expensive house."

And that’s how everyone does it, so don’t be surprised if your acquaintance’s house actually cost 450k. As long as you haven’t seen the building contract and all addenda with your own eyes, you unfortunately know absolutely nothing.