High construction costs with rising building interest rates

The OP has a similar household income. But he complains that he sees no chance at all.

That’s the small difference: some take action and dare, once options present themselves and they are willing to recognize them. Others could, but are not able to make something out of their comfort zone. Instead, they complain. Used properties are handled similarly. Some see a property as potential new living space for themselves and their family: they consider which wall could be removed, how to arrange new kitchen furniture, and think about where the family sofa could be placed, whether functions can be swapped. Then they roughly calculate what they will do before the move and what they will gradually implement after moving, where they can live in the meantime, etc. Others, in contrast, see a property as a single problem: the facade doesn’t have the desired clinker color of the 2020s, the floor plan doesn’t match the desired standard 08/15 with a straight staircase. Instead, there is a creaking, but compared to today, a rather grand wooden staircase, a true treasure. Options for painting aren’t even considered because Pinterest doesn’t show that kind of thing due to the lack of an algorithm. Naggingly, they stand in front of one "old-fashioned" feature after another, without appreciating them and seeing the possibilities of making something chic out of them. And that with their own two or four hands, stain, glaze, paint, coverings – things every influencer would envy. Some have the habit of seeing everything in black. Turning a special old building into an ordinary new building naturally costs more than a common renovation, and so a used property is mentally regarded as disproportionately expensive. Aside from that, hidden costs in a new building are quickly forgotten. Then it is said that existing houses are more expensive because ancillary building costs and outdoor facilities in the new build have not even been calculated yet. Uncreative people are not to be envied. Often, they stand in the way of their own happiness.

This fits the following: We were recently visiting a friend near Augsburg. About 2 years ago, she bought an old little house on the edge of a nearby district town after she got divorced. The equity was very low; the heavily dilapidated little house cost about €170,000. I see it now and saw the pictures before the purchase and wondered how a single woman in her late 50s working in the social sector simply bought this house after bringing an acquaintance (all-round craftsman) along for the viewing. I wouldn’t have dared to do that and otherwise consider myself rather brave. Ok, it’s located on a somewhat busy street, but she has a quaint plot; everything looks like the so-called witch’s house. Door height on the upper floor, which is only accessible by a very simple wooden staircase without a railing, is 180 cm; I have to duck, ceiling height on the upper floor about 200 cm. She removed part of the upper floor ceiling in her bedroom and thus gained a beautiful, open space. Heating is new, very old doors painted but since replaced cheaply with new ones. All ceilings are just painted over, facade partly clad with simple wood, stove in the living room, otherwise radiators. She did only what was really necessary and made sure it looked neat, the roof still holds, kitchen is new, floor covered with cheap tiles. Neither underfloor heating nor any other frills, insulation rather weak; she even puts on a sweater when needed, quaint bathroom, a simple front door and much more. Everything in the house is different than what you would expect from a dream house and yet it has become a special home but not by complaining or hesitating. One could also call it “more luck than judgment,” but I have known her for decades and know that she really gets things done and doesn’t wait, thereby “forcing” her luck; she had no alternative after the purchase. When she retires in 7 years, the house will be paid off, her calculation is solid, there is nothing to inherit. Currently, she is on a week-long inexpensive beach vacation; afterward, she will visit us. She has to budget and she does it. I have now been there several times and always admire what she has made out of this once-run-down house from around 1950; I would feel comfortable there immediately. The children and their friends helped, it was done and renovated as best they could with their means; luxury, no way, and yet she owns a beautiful, tasteful home. Of course, she could also have had bad luck, but I never hear her complain, even though before the divorce, living in her husband’s insolvency, she lived in a fancy new passive house; her consistently positive approach and readiness to tackle things and omit unnecessary things have helped her achieve this remarkable success. In her circle of acquaintances, they advised her to rent a two-room apartment; now she will have a paid-off house in her old age. I know why she is my friend, she never complains or looks for others to blame for her temporarily unbalanced life situation, not the world economy or the government; she takes care of herself. Her children are like that too, cheerful and positive—I like that kind of thing and have great respect for it! Instead of taking expensive vacations, we sometimes swap houses including cars; nowadays there are many ways to Rome.

That’s all well and good, but altai herself says, "today I don’t see any chance anymore." Aside from her undisputed hard work feeding two children on her own, she herself recognizes that a new build would simply NOT be possible today. Using her as an example that it’s still possible today is a distortion of reality.

All your examples and also your own house, whether used or new, would be smaller today or wouldn’t exist at all, unless you already had the equity available anyway or really built 40 years ago. That is a fact and your talk about blood, sweat, and tears doesn’t make it any better. By the way, a used house is by no means beneath people’s dignity. But we are talking here about the first generation that will have worse living conditions than their parents’ generation and increasingly already does (well, except for the post-war period and the associated destruction). And what is even more serious: Whether one personally needs a new build or not, someone has to build it, otherwise housing will become even scarcer than it already is. And someone has to be able to afford that housing. And that’s exactly what you don’t get, since you have your house. You don’t have to sit with five people in a three-room apartment in Munich paying double the rent. By the way, the much-praised 90s row house here doesn’t cost 400 thousand in the West German metropolitan area, but 800 thousand. Anyone can quickly calculate that mortgage payment. Spoiler: It takes two Altais plus the support of the parents. That might still be enough, but not for a new build anymore. For that, unfortunately, there’s no one left and the situation will worsen further.

Yes, complaining doesn’t help. But it is urgently necessary to point out the societal problems. Current homeowners don’t have to care about that. Some (no personal accusation) will probably secretly even be happy about the situation. Scarcity drives prices up further after all.

We are only talking here about the first generation that will have worse living conditions than their parents' generation

How do you determine that exactly? 140 instead of 170 sqm? Standard electrical system instead of KNX? Double garage instead of triple garage?

By the way, the much-praised 90s terraced house you mentioned doesn’t cost 400 thousand in the western German metropolitan area, but 800 thousand.

Depends on the "metropolis" and the surroundings. I even know some TOP 7 locations where that works and I even live in such an area. These houses can be found almost everywhere.

All your examples and even your own house, whether used or new, would be a size smaller today

That is the only point where I fully agree with you and it is also the only point (besides exaggerated equipment wishes) that makes building bearable for most people today who want to do it. A return to reasonable use of space. The living area per capita, for example, has increased by almost 40% in the last 30 years (but that is not only due to preferences, but also due to the increase in single-person households). And hardly anyone was unhappy in the mid-90s.

How do I determine that? I look at the housing situation in my personal environment during my childhood/youth and now in adulthood. And in adulthood, it is simply the case that almost no one can afford a new build anymore, some end up with a used terraced house (having grown up in a single-family home themselves during their own childhood), and some without sufficient family support rot away forever in their tiny rented apartment. That is exactly why people complain. They cannot maintain the standard of living they themselves were used to from home when starting their own family. Decline hurts, always.

By the way, I find it absurd how things always drift into the personal here and envy is presumed just because one recognizes a social problem. I myself do not live badly and cannot really complain about my financial situation, but I can judge the realities sufficiently objectively, whereas some people here enjoy stroking their egos about the supposed or actual (I am too far removed to judge) achievement.

I do not base it on 140m2 instead of 170m2 or double instead of triple garages. It is not even the parent generation, but simply people who are 5-15 years older and just had the grace of being born a few years earlier. The parent generation is rather the Boomer generation, which was able to benefit from the construction boom until the mid-90s. Of course, it is true that none of this was given away for free. These people did not study until 25 and travel the world at 18. I do see the differences as well. But that changes nothing about the outcome. Social realities have changed, and apart from a few dual study programs, I cannot think of much today that would allow young people, even with a frugal lifestyle, to build up the necessary equity not to start building before 40 or even 50. At least where it is expensive. Yes, prices vary regionally. But wages also vary regionally. Of course, there are exceptions, but the vast majority of highly-paid jobs are precisely where it is expensive.

By the way, I am also old enough to have had the stories of the hard old days passed down to me within the family. Of course, one can have their childhood room in the unheated attic. In winter (which were very, very harsh and snowy back in the 50s-60s), the windows freeze, in summer it is complete hell. Of course one can live like that. But do we seriously want to go back there and just "put on a sweater in winter"? And should those mostly preach who themselves sit in the warm house?

What am I basing this on? I look at the living situation in my personal environment during my childhood / youth and now in adulthood.

The parent generation is more or less the boomer generation, which was able to benefit from the construction boom until the mid-90s.

And compared to today, they have such a much worse living quality. What you are saying is complete nonsense. So now once again very concretely. Why is the living situation worse today than back then?