House construction with multiplier > 30?

Your calculation is surely supposed to somehow aim at the amortization, but that doesn’t work like that, too many dynamic factors. Rents rise, reserves for renovations must be continuously formed for the property, how do you want to account for the virtual "garden rent" and garage rent for the property? etc. A house is a luxury, it only pays off with sustained price increases and a later profitable sale. The saved rent doesn’t pay off during one’s lifetime anyway.

Family around 40, then I wonder: how old are the children? Assuming the oldest is 12, then in 6 years you already have the first children’s room empty again. That doesn’t mean one shouldn’t build, but maybe build "differently".

Family around 40, then I wonder: how old are the children? Assuming the oldest is 12, then in 6 years you already have the first bedroom empty again. Which doesn’t mean you shouldn’t build, but maybe build "differently".

We also thought about these things when planning the floor plan, but then realized, looking at our personal environment, that many still live at home at 22 or 23 years old, either for cost reasons or convenience. And even if they leave the nest earlier, it’s always nice if there is basically still an option for overnight stays.

It is true that you have to consider the construction costs in relation to the local rent index. The financing advisor also looks at that when evaluating. Building an expensive house in a region with low rents and land prices is a big gamble. In the town where we are building, there has been a great house (built in 2014) on the internet for a while, with all the bells and whistles. Only unfortunately for 420,000 euros – and they can’t sell it because of that. Because before I pay that, I’d rather build myself or enjoy the cheapest rents.

We have never given your thoughts any consideration. Building or buying a house is more of an emotional matter for us than an economic one.

When I read this thread here, I heard about the factor for the first time and calculated it. It is about 40 for us. But I'm not going to worry about that any further.

Hello, thank you very much for your many responses.

: Renting is unfortunately not an option, as there are no relevant properties available there either.

: Yes, land with a maximum of 100K is available.

: rather rural, otherwise the comparable rent wouldn't be so low.

: The child is only 2, so we still have a few years. But we are aware of your point.

I understand the previous comments to mean that owning a home in the provinces is currently more of a lifestyle decision than an economic one. So more of a consumption than an investment object. It used to be different (?). Back then, a house was always considered an asset. That would probably not be the case for us with a multiplier > 30. Meaning, similar to a new car, we would effectively lose 120K upon moving in. It’s more like buying a 5 Series BMW instead of a VW Golf (this is not a judgment of the cars, just a price example). The premium is "luxury."

Is that right?

It used to be different (?). A house was always considered an investment.

But only based on feeling. Such an owner-occupied house is also quite a cluster risk.

If you look at the statistics from earlier times; it was always just one thing: location, location, location.

And if you don't have that, there wasn't much value increase; or there are also big areas in Germany where prices have stagnated or even declined for a long time.

But where we will be in the next 10, 20, or 30 years; except for a few hotspots, you really can't predict at all.

To say, similar to a new car, we would lose about 120K as soon as we move in

Currently, in a normal location, that is not true at all.

: Renting is unfortunately no option, as there are no relevant properties there either

Then the question doesn't arise at all.

How is the factor calculated? I've never heard of it before... not even in the context of mortgage financing discussions