House construction costs and financing

Hello everyone,

I am really looking forward to your assessment :) Due to Corona and the even higher prices in the construction industry, it feels almost impossible to afford a home.

General information about you:

[*]Who are you?
[*]How old are you? 31, 28
[*]Are there children? No
[*]Are children planned? Yes in 1-2 years
[*]What do you do for a living? Master craftsman, team leader
[*]Are you employed, self-employed, retired, housewife, househusband etc...? employed
[*]How many hours do you work? 40, 40

Income and asset situation:

[*]What income do you have (gross/net)? 2450, 2300
[*]How much child benefit is there?
[*]Other transfer payments such as parental allowance, sick pay, etc.?
[*]How much equity do you have? 40,000€
[*]How much equity do you want to put into the house project? 10,000€

Housing costs: total 950€

[*]current basic rent
[*]current total rent (including utilities)
[*]electricity
[*]gas
[*]water, sewage, garbage fees, street cleaning
[*]telephone, internet, mobile phone

Mobility costs:

[*]monthly ticket for bus and train (also for the children!)
[*]car loan (or savings rate for new car)
[*]insurance 75€
[*]taxes
[*]fuel 100€
[*]repairs
[*]other
[*]Is there a second car, motorcycle, scooter? Please provide all points again!

Insurance costs:

[*]private health insurance (also supplementary health insurance, daily sickness allowance etc.)
[*]liability insurance (also animals)
[*]capital or term life insurance
[*]pension insurance (also Riester, Rürup, etc...)
[*]disability insurance 57€
[*]accident insurance
[*]household insurance 6€
[*]legal protection insurance 12€
[*]other insurance (such as travel insurance, funeral insurance)

Living expenses:

[*]groceries 350€
[*]restaurant costs 100€
[*]care/drugstore 25€
[*]pets (food, vet, medicine, stable costs)
[*]medication
[*]clothing
[*]furniture
[*]daycare/school fees (and meal money)
[*]tutoring
[*]school supplies and books
[*]club fees/gym
[*]babysitter
[*]toys
[*]cleaning
[*]TV/video/audio/CDs/DVDs
[*]tickets (football, cinema, concerts etc...)
[*]donations
[*]other

Savings:

[*]vacation
[*]house
[*]retirement provision
[*]hobbies/gifts
[*]other

Other expenses:

[*]maintenance payments?
[*]loans?
[*]other?
[*]Was something forgotten? Then please specify here at the latest!

Summary of income and expenses:

[*]total income 4750€
[*]total expenses: approx. 2100€
[*]balance 2650
[*]of which total basic rent and dispensable savings (e.g., savings rate for house)

General information about the property:

[*]How big is the plot? 500
[*]What are its dimensions?
[*]What is the standard land value? 195
[*]New build, old building (year of construction), house type? New build
[*]Garages? Carport
[*]How big is the house? 150sqm (living area / usable area)
[*]What is the market value of the plot and house after completion?

Construction or purchase costs:

[*]plot costs 100,000€
[*]development costs 30,000€
[*]ancillary acquisition costs (notary, court, real estate transfer tax, broker)
[*]construction or purchase costs (incl. architect, structural engineer)
[*]renovation and/or refurbishment costs
[*]incidental construction costs (e.g. house connections, soil surveyor, construction power etc.)
[*]outdoor facilities/terrace, paths, garden design, fences etc...
[*]financing costs (e.g. fees or commitment interest)
[*]total costs amount to 384,000€ ??

other costs:

[*]kitchen costs
[*]furniture, lamps, decoration
[*]other "non acquisition, ancillary acquisition, construction or incidental construction costs"

Cost summary:

[*]total costs
[*]deductible equity
[*]financing amount

Necessary loan details:
(for multiple components, specify for all components, for multiple variants please clearly separate them):

[*]loan amount 530,000€
[*]loan type (e.g. annuity loan, bullet loan etc...)
[*]interest rate (p.a. nominal, otherwise effective)
[*]fixed interest period 30 years
[*]remaining debt at end of fixed interest period
[*]assumed total term until full repayment 39 years
[*]initial repayment rate
[*]monthly installment 1,450€
[*]special repayments possible? (specify amount)
[*]repayment rate change possible? (specify conditions such as number, repayment rate range)
[*]For pre-, interim- or bridging loans with building savings contracts please provide details on the building savings contract (building savings sum, credit balance interest rate, minimum savings rate, minimum savings sum, planned savings rate, Riester premiums, expected allocation date, later credit installment, credit interest etc...)

Thank you very much

My dear swan, you have really taken on something there. To be honest, that's a bit too much for me, but I guess I'm more of the "conservative" sort here. :)

384,000 € / 150 sqm = 2,560 € per sqm. And that includes additional costs and equipment. That will be very difficult. Especially if there is still a desire to have children. I would suggest first buying a plot of land, paying it off, and seeing how your financial situation develops.

Where do you get such a good interest rate for such a high loan-to-value ratio and such a long fixed interest period? That's only 3.3% annuity. Is that a serious offer?
It should rather look like this:


Apart from that, I find the costs "something to think about" and the burden too high – where is your equity at the age of 40 if you have so much left every month.

As a person acting as a banker, I would say "no," as a bank it would still be manageable.

Where do you want to build? Where do the 384k for the house come from? Do you have concrete offers? Depending on the building location, you should expect about 2500 €/m2 PLUS additional costs, floors, painting, garage, cellar,...etc. Even if you want to build without a cellar and garage, that would already be 375k plus about 50k additional costs = 425k total costs. But then the plot should be perfectly level, and you should be relatively disciplined in the standard of the BU and be able to do the painting work yourself...

In total, that would already be 525k for house and plot. Then there is still missing a buffer, material costs EL and money for outdoor facilities (some things can wait) or car shelter etc.

So I see the problem here rather that the total costs are higher than expected (depending on the answer to the 3 questions at the beginning of my post!)

Purely based on income, the loan amount you mentioned would probably just be feasible and manageable. Also, the monthly housing cost burden of about 36% of the income is still okay... but: all that without kids. We managed 1 year of parental leave, but now my wife is working again (80%) so that the savings do not decrease monthly, we have your income (almost identical) but a lower monthly rate and a lower loan requirement. All in all, with your numbers, it is tight for me, but I see the numbers as problematic (regarding the house cost issue).

Welcome to the forum, welcome to the lion's den.

My dear swan, you have really set yourselves a challenge. To be honest, that is too much of a good thing for me, but I am probably more of the "conservative" type here.

Oh yes, exactly my thought.

Several warning lights went on for me immediately:
- House costs seem too low
- Loan amount already 110 times the net income (probably will be more, see above)
- Expense side is glossed over, as no car costs (new purchase every x years), no hobbies, no vacation, no mobile phone costs, etc.
- Loss of income during parental leave critical, part-time not possible, both must work
- Financing extending into retirement

Some homework still needs to be done here before a house build can start. The income is tight, so planning and calculations must be done carefully. Unfortunately, that is still missing. With real numbers, one can then see if it is possible and whether the necessary restrictions still suit you.