House construction: Is income and equity sufficient for financing?

Hello,

We are about to decide to build. I am 28 and my husband is 30. We have found a very nice plot of land (480sqm approx. 130,000 euros) that we really like. We have a household income of about 4,700 euros. Sometimes it is more, sometimes less, because my husband works on commission. We have equity of 50,000 euros. I am not sure if our income and our equity are enough for building the house. The main bank says yes but I am still unsure if we can pay everything off by retirement age. We have to finance for 30 years. The house and everything around it would cost us about 350,000 euros.

House and everything around it for 350,000?

If the plot costs 130k, then you don't live in an expensive area, but also not in an extremely cheap one. A house for 350k there would be small and without a basement, right? Otherwise, with these numbers it would still work for me. But as in other threads, it really depends on how important the personal dream house is to someone.

130k + 350k - 50k equity = 430k

This is then below the rough rule of income × 100, so financeable.

What does the family planning look like / how secure is the income.
It is not particularly comfortable, but doable.

Please provide a few more details about your building wishes... 350k is not much all in.

220k for the house including incidental construction costs and buffer? Hardly imaginable without considerable personal contribution. There is too much missing information here.

If you really only need 300,000 from the bank, then you can expect a rate of 1,100/1,200 including KfW. With a household income of 4,700, normal consumption behavior, and no other ongoing loans, something like this is absolutely feasible. But as I said, without further information, no one can assess this seriously here.

Jean-Marc, you simply forgot about the property! :D

At 350,000, it really has to be a house around 120 m2 (without a basement, without a garage), otherwise the calculation is wrong. If it’s going to be such a small house, then you will just about get it financed.

You would need about 450,000 euros from the bank including the property. I wouldn’t feel comfortable with that given the low household income. Not even over 30 years!