Financing single-family house purchase price 365k, additional construction costs 150k, renovation?

Hello everyone,

we have to decide for or against a house by the end of the week:
The detached house in timber frame construction, built in 1976 (living area 166m², plot 670m², gable roof 30°, fully basement, first roof - converted but uninsulated, first water pipes made of copper, first electrical wiring, bathroom 2003, gas central heating from 2017) costs 365k + purchase incidental costs (including realtor) + planned 200k investment.

The planned renovation and refurbishment costs consist of:

- 20k kitchen
- 15k floors, walls and doors
- 25k windows
- 45k roof insulation + roof covering
- 15k photovoltaic
- 20k electricity
- 20k water
- 40k exterior insulation including removal and disposal of asbestos cement panels

Is this a realistic estimate? The house is located in Ostalbkreis.

What we are wondering is how we could structure the financing:

Interhyp wants to run the entire sum of just under 550,000€ after deducting 50k equity through a single module at Hypovereinsbank with 4% interest, 30 years fixed interest, and 5% special repayment per year, and recommends taking advantage of BAFA funding. KfW should be completely excluded. According to Interhyp, the L-Bank has a stop on new loans at least until March 2023.

Our counterproposal would be:

[*]100,000€ KfW Home Ownership Program 124
[*]300,000€ Hypo-Vereinsbank or PSD-Bank
[*]150,000€ KfW Residential Building Loan 261
[*]possibly KfW Renewable Energy – Standard 270 for the photovoltaic system

Provided we commission an energy consultant beforehand and the house could be brought to the corresponding efficiency level – wouldn’t that make more sense than going the pure route via HypoVereinsbank and BAFA? Or can further funding programs even be combined with BAFA?

Thanks for the help!
Andreas

Well, bringing the house up to KfW85 standard is no walk in the park. I doubt that your €150k will be enough...
You have asbestos in the building,
the basement also needs to be insulated (is it dry?),
with the roof you also have to consider whether a new roof structure might make sense, the photovoltaic system is tight, you haven’t accounted for any costs for architects, engineering firms, or energy consultants. I would expect a higher amount.

The energy consultant can help if you throw in a lot of money...

I also think some of the renovation items might be a bit underestimated. Floors, walls, and doors for 15k will be difficult, the material alone will be higher.

What attracts you to KFW? I don’t find them that attractive anymore. Their interest rates are no longer that far from the market. I recently looked into the EE program for photovoltaics myself and thought that I actually find the interest rate uninteresting.

So having a renovation plan created currently costs us 520€. If we implement this plan, it costs 3% of the total calculation, whereby you yourself pay 50% of that and 50% is covered by the state. Furthermore, I think that one currently has to keep an eye on the energy efficiency classes, as the EU program wants existing buildings to be at class E by 2033 and overall every house to be at class D, which is why different measures create "incentives for renovation." At least that’s how I understood it.. So if you now start and plan to live there for 30/40 years (God willing), then at least I have the whole thing in mind when I think about the renovation.

What draws you to KFW? I don't find it so attractive anymore. Their interest rates are no longer that far from the market.

Well, over 20 years, I believe it's currently 1.56 or so compared to 3.7 at the house bank.

KfW is already worth it, but you will not get by with the maximum funded 150k. You will have to put more into it to reach KfW85. By the way, the energy consultant will cost you significantly more, expect around 5-10k. However, he does significantly more than with the renovation roadmap.