House construction too expensive - Stop building?

Attention, now comes just a suspicion, because I experience this very often among acquaintances:

Could it be that this is the very first time you are taking on debt? And until now you either haven't paid rent or your parents were the landlords?

The step to get into debt of over 400k with a "ruthless bank" that wants to see the payment every month without personal considerations is relatively big. As I said, just in case it is like that: don't worry about it. You will be able to bring the money every month. And you will be able to live well with the leftover money. If you want to make bigger purchases regularly or the vacations get expensive, there are bonus payments. Additionally, you have saving potential in the monthly expenses.

We also had such moments. For us, it was really difficult at times, because for example my parents had a much smaller sum as a loan, at high interest rates. Since we renovated, we calculated a reasonable budget and financed the majority + equity.

In the end it was a 320k loan. We could also have had a 250k loan + money from parents/in-laws. There were sometimes very tough conflicts about why we were taking on so much money etc. My wife was strongly affected by that at times.

A loan installment of 1200€ is actually quite reasonable. There would still be some buffer upwards. Here in the forum, there are people who take out (or want to take out) over 2000€ with similar income. However, if you are panicking, possibly also due to the so-called baby blues, good words probably won't help much. It's good that you are seeking professional help. There is no need to be ashamed of that. A good dose of calmness, a few kisses from your husband, hugs from me and from us forum members, that should give you courage. You can do this. The rational numbers are okay, realistic, and very manageable, as long as neither of you gambles it all away. All the best.. and let us know how it goes. For distraction, we also have a house pictures thread here, where you can simply show your shell construction and so on, how it’s progressing :)

I know why I uninstalled the onlinepokerapp...
;)

I find the fear regarding the numbers completely irrational. We currently pay a rate of €2500 with a similar income and have been on vacation twice as well. Not a long-haul trip nor all-inclusive, but our life doesn't feel like a severe sacrifice :)

How do you manage that? What are your expenses like?

Stopping now would be the stupidest solution of all. If you want to come out of this situation financially unscathed to some extent, you have to complete the house construction and then sell the place to the highest bidder. Anything else will end in a financial disaster; an unfinished construction site can only be sold at a heavy discount. Every buyer immediately suspects massive botched work at a construction site sold unplanned and factors in the risk.

In this respect, you really have no choice but the famous "close your eyes and push through." Everything you invest in the construction now only increases the sales value.

And once the house is finished, take a breather and see how high the comparable rent for a decent rental apartment would be. Then you will very quickly decide to pay the installment rather than rent and live in ownership. You can always sell in 5 years if it absolutely doesn't work out financially.

How do you manage that? What are your expenses?

I think a 2500€ installment plus additional costs on a ~5000€ household income already requires a very frugal, that is, ascetic lifestyle. Maybe not the best comparison - but basically, with a 1200€ installment / 4600€ household income, you have a dream value! If, due to cost increases, this now shifts somewhat towards 30%-33%, everything is still fine. Calculate and lay everything out precisely; that way you get an overview again and can build scenarios – and possibilities to compensate for these.