Financing framework, feasible?

Hello everyone,

we come from the east Bavarian area, near Regensburg, and currently the city has plots of land advertised on which one can apply with financing confirmation etc.

The price is 200,000€ fully developed for about 550 sqm; i.e. about 380€/sqm :-(

Unfortunately, prices in the area are all at least 300€/sqm and upwards, and for directly adjacent to Regensburg the price is almost cheap already.

Now to our information:

General information about you:

[*]How old are you - both 36
[*]Are there children? - 1 child, 5 years old
[*]Are more children planned? - maybe one more
[*]What do you do professionally? I am a commercial employee; better half public service
[*]Are you employed, self-employed, retired, housewife, househusband etc...?
[*]How many hours do you work? Me full-time; her 50%

Income and asset situation:

[*]What income do you have (gross/net)? Me 3000€; her 1500€ total 4500€ net
[*]How much child benefit is there? - 194€
[*]Other transfer payments such as parental allowance, sick pay, etc...?
[*]How much equity do you have? - currently 100,000€
[*]How much equity do you want to invest in the house project? about 80,000€

Expense situation:

Housing costs:

[*]current cold rent: - 900€
[*]current warm rent: - 1100€
[*]Electricity: - 2x 50€ advance payment for household electricity and heating
[*]Water, sewage, garbage fees, street cleaning - water 40€
[*]Telephone, internet, mobile phone: total 50€

Income and expense totals:

[*]Total income:- 4500€
[*]Total expenses: summed about 3000€ (2x car; retirement provision; insurance; groceries etc.)
[*]Current savings rate 1500€

General information about the property:

[*]How big is the plot? - about 550 sqm
[*]What are its dimensions? - not known yet

Construction or purchase costs:

[*]Plot costs - about 205,000€ fully developed
[*]Additional building costs (e.g. house connections, soil surveyor, construction power etc.): no idea?
[*]Outdoor facilities/terrace, paths, garden design, fences etc...
[*]Financing costs (e.g. fees or commitment interest)
[*]Total costs

Since we currently do not yet have offers from house construction companies, we wanted to ask here whether it is at all sensible/feasible with our budget? Especially considering that maybe a second child might still come.

Planned is the construction of a single-family house with about 150 sqm floor space + double carport with attached substitute basement room.

Many thanks for your answers

Greetings from Bavaria

Unfortunately not feasible or not financially viable.

In total, you have a capital requirement of approximately 600,000 euros. After deducting equity, at least 500,000 would need to be financed. With the net equity, this is not feasible.

You need at least 150,000 more equity or higher net income.

I roughly came to this calculation as well :-( The irony is that the plots are allocated according to a points system, and for a maximum annual gross income up to 66k€, you get the highest score; everything above that results in deductions. I just wonder how anyone with the above-mentioned annual gross income is supposed to ever build on these plots... (Specifically advertised for families...)

Tough number. 500k loan should be paid off before retirement = 31 years. That would be 1850€/month + approx. 300€ additional costs = 2150. Your savings rate + rent including utilities = 2600€. Sounds doable, but would be too risky for me. Regards

Thank you, we see it that way too, but had hoped that we had overlooked something... But we are not so risk-taking that we have to build a house at all costs, at least not in that area. Thank you for your answers

I just wonder how anyone is supposed to ever build on these plots with the above-mentioned annual gross income...(Specifically advertised for families...)

Many still receive financial support from their parents/grandparents, let's not kid ourselves.