Financing project as a single with a lot of own effort

To be honest, the house in its current state is a bottomless pit.

How is the pit supposed to suddenly get a bottom when you take it over – just by carrying out the further renovation all at once as a Big Bang?

It has been agreed that the one who takes it over/renovates it basically gets it completely for 1€.

I’m afraid that, happening within the family, this will be considered a gift by the tax authorities.

The "bottomless pit" needs to be sold. Exactly for the reasons that gave the house its name. One should make a cut there in order to be able to strive for quality of life.

A complete sale there is "unfortunately" out of the question. Basically, you are theoretically right... but practically it is so that it was an old farmhouse and more buildings belong to it. In addition, there are also about 12 hectares of land! Even if the house may be old, I can personally hardly wish for a higher quality of life. Quiet location, plenty of space, several gardens, etc.

Should this ultimately become a farm transfer, including all properties? And also with the right of residence and possibly even all other "tricks" (obligation to provide care, usage rights of the garden or similar) that are common in agriculture? This is not meant to sound derogatory, I have great understanding that the transferor, for example, wants to secure monthly payments. But all of this must then also be taken into account from the very beginning in your personal planning.

Complete sale is "unfortunately" not an option.

But maybe demolition of building(s) parts that are a mobile construction site. Your description unfortunately sounds like a ramshackle building with a flying oil change, i.e. also likely additional funding needed during repayment, which would probably be fatal for the financing request.

On the positive side, one can still mention the savings rate of €800 with a net income of €1700. That's almost 50%. Unfortunately, you still can't buy anything with that, and everything that needed to be said about the rest has basically already been said.