House construction too expensive - Stop building?

Hello!

In my opinion, we have made a huge mistake. We are in the middle of construction and I fear our budget will not come close to being enough until the house is finished. I would prefer to stop the construction immediately and undo everything. But that won’t be possible. We acted too hastily and naively and now we are facing a huge mountain of debt that we cannot afford.

Brief overview: Single-family house 154 sqm on the family’s existing plot. Costs estimated at 435,000 euros for everything. We don’t have a general contractor and are managing it ourselves after the initial planning with an architect. After the building permit, we are on our own.

Our household net income is about 4,600 euros since I am currently on parental leave. It will only increase slightly afterward due to part-time work. However, we will also have future income from renting out a 100 sqm apartment. Loan installment is 1,200 euros for 400k. We still have a flexible loan part open which is not fixed yet and should only be used if necessary. In the original plan, we assumed that the amount of 400k would cover everything. Now my eyes are opening more and more and we should have never started the construction because in my opinion we completely overstretched ourselves. My husband, on the other hand, still sees everything very calmly and is not worried at all. We wanted to do a lot ourselves and save money that way. We are doing that in many areas, but in my opinion it won’t be enough. And now I regularly get panic attacks and can’t sleep anymore. How do we get out of this now?

How do you eat an elephant?
Piece by piece.

I believe I can read from you that you are afraid of the monster house construction. With all its problems. And that is overwhelming.

But it is not. Don’t see the monster as a whole. Break it down into its individual challenges. And then just focus on the ones that are currently urgent.

The same applies to the loan amount. The 435,000 euros don’t matter for now. It’s such an abstractly large amount that you don’t really understand it anyway.
What matters is the monthly rate. And at around 1200 euros with a household income of about 5000 euros, that is absolutely healthy. Plus income and the financial security of an apartment you own.

I know the "monster-creation" from my wife. And presumably, that’s also quite good as a warning voice.
But nothing more than that. Don’t let it paralyze you. Take some of your husband’s calmness and, with individual decisions, keep checking to make sure the financial framework is not stretched too far. I’m always grateful to my wife for that too...

There might be some truth to that. Nevertheless, it is the case that we will probably have to bear a higher burden since we will not make it with the planned 400k. Hopefully, it will only be the 435k... Of course, the net income is not bad, but I also see the expenses on the other side, especially with a small baby at home. I am just desperate right now and also feel that we received poor advice at the bank because we currently feel over-indebted. At the bank, we disclosed that I am pregnant, but we never calculated together whether the burden would still be bearable for us with less income. We of course did the math ourselves, but I think we "painted a rosier picture." I would assume under the current conditions we wouldn't even get the loan and believe we were too naive about the whole thing. Unfortunately, I currently see no way out of all this... I just feel like crying!

You’re not going to work part-time for the next decades, are you? Maybe the thought "if nothing works out, then we’ll be debt-free in three years" will help you ... keyword [Privatinsolvenz].

No, that does not help at all.. That cannot and must not be the solution. Have we really gotten ourselves so lost in something? Maybe there are fellow sufferers here who can share their experience?

You should seek medical help or live with your husband.

So far the numbers look good, and you have not been misadvised. The banker does not check whether the calculation is correct; you should have done that and also built in a buffer.

If the property comes from the family, there will also be inheritances etc. An apartment that can be rented out is also a "luxury problem." If necessary, it can also be sold.

The top priority should be to stay calm and not panic. Especially with a baby, it is called "baby blues." For you, everything comes together all at once. Baby, construction, fear of failure, etc.