How much land and house can we afford?

Hello dear ones,

this is my first post.

In our absolute dream area in Berlin, some building plots have finally come on the market. We would like to take the step, but are still a bit uncertain about how much land and house we can afford. Before we commit to a plot and delve deeper into planning, I would therefore very much appreciate feedback that will help us realistically assess our expectations and limits.

The current key points are as follows:

Desired plot approx. 575m2 at €135/m2	77,625
Development for new water line	20,000
Single-family house 132 m², turnkey, including air-water heat pump, underfloor heating, manual shutters, exterior walls 365 mm aerated concrete plan blocks, load-bearing interior walls made of 175 mm aerated concrete	157,140
total:	254,765

-> Does the pure house price seem realistic and if not, why? It is just under 1200 per m2, below the usual benchmark of 1500 used here. Is Berlin cheaper or where might there be a catch that we should pay special attention to in further considerations?

In addition, the following ancillary costs estimated by the seller are to be added:

Surveyor	3,500
Utility connections (water, electricity, telecommunications)	6,000
Building permit	700
Notary approx. 2 %	1,552
Property transfer tax 5%	3,881
Authority costs (land register entries) approx. 1 %	776
total:	16,409

-> What points are missing here to reach the usually estimated 35-40,000 Euros here?

Furthermore, based on reading this forum, I would plan an additional 50,000 Euros as follows:

Walls wallpapering/painting	10,000
Floors	10,000
Reserves	10,000
Kitchen	10,000
Outdoor facilities	10,000

Based on the numbers used here, I come to 254,765 + 16,409 + 50,000 = 321,174 Euros.

If I adjust towards the benchmarks frequently given here and add about 20,000 more ancillary costs plus about 40,000 extra for the house, we would already be at around 380,000 Euros.

According to my initial rough calculations outlined below, 320,000 EUR should be OK, 380,000 EUR rather difficult:

We have about 90,000 equity and earn about 4,800 euros net including child benefit. That doesn’t sound bad at first, but our three children cost us quite a bit in care and school expenses, so based on very rough budget estimates I would prefer not to plan for more than 800-900 euros monthly installment – that would leave some margin, which I would rather use for special repayments if more money is left over. Ideally, repayment in max. 30 years, although that would probably still require some inheritance or similar...

So I roughly come to a realistic loan amount of about 250,000 EUR, right?

What is still open for me is the question of which direction we should reasonably and realistically plan our long-term space requirements in terms of construction costs:

With three children (currently 9, 7, 2 years) we want at least 5 rooms, preferably 6, since our families live far away and we therefore often have overnight guests. We could well imagine smaller rooms (we are used to that), but we think that sooner or later we might have to fall back on a basement or the attic. Would it be smarter to build a smaller house right away (how big at least?) with a basement and/or to plan an at least guest-room usable finished attic from the outset? The figures we were given for this were: 35,000 for a basement, 8,000 for a finished attic.

So, I hope these are not too many questions at once or in the wrong place, otherwise I hope you will understand that as a newcomer and I look forward to constructive criticism on where, how or when I might better raise them.

I am already thankful in advance for your answers and food for thought.

Best regards,

Kazazi

5 rooms and then only 132sqm? That doesn't add up. With the number of children, there should be, for example, two bathrooms.
Area calculation:
- 5 rooms at 12sqm each = 60sqm
- 2 bathrooms at 8sqm each = 16sqm
- Upstairs hallway = 6sqm
- Ground floor hallway = 6sqm
- Utility room = 8sqm
- Kitchen = 12sqm
- Living room = 35sqm
= Minimum size 143sqm, but that will already be tight (e.g. master bedroom with a large bed and wardrobe? Utility room sufficient? 6 rooms? etc.), I would rather plan for at least 170-190sqm.

4,800 net and only 800 EUR installment? There should be more possible if you think about your lifestyle. We also have three children, earn less, and have a significantly higher installment ==> we also eat out, go on vacation by car/plane, and the children can even wear "brand clothes". What costs you 3,600 EUR every month (= net minus rent/installment minus additional costs)? Few families would have to think about an "income problem" like yours, as they will never reach such a good income.

So I roughly arrive at a realistic loan amount of about 250,000 EUR, right?

How do you come to that amount?

With a 900 € installment and a term of 30 years, I find that rather unrealistic! Or what special payments have you factored in?

First of all, thank you very much for the answers so far.

@backbone23: It is true that a 900 euro installment and about 30 years term cannot repay 250,000 euros, but about 1,100 euros installment can, which we could probably just afford; and I thought that a somewhat lower installment and paying off the rest through special repayments, if you have the additional 200 euros per month left, makes more sense because it is more flexible?

@nordanney: For the room size, we thought of a somewhat smaller living room plus 4 rooms between 10-15 m2. Where the sixth room should come from, if we do not resort to the basement or attic, is not entirely clear to me yet; but I do not consider it impossible. I will definitely continue to look at the floor plans and hopefully soon post ideas for comments myself.

Regarding the money, I also hope that there will be a bit more buffer left, but when you constantly read that people tend to underestimate their expenses, I prefer to be cautious at the beginning. We have alone over 1,000 euros for childcare/school costs, plus items like Riester contracts, music school, insurance, train travel costs (no car), etc. …

What do you think of the cost estimate for the project, do the rough figures approximately match for Berlin?

Best regards,

Kazazi

And what if you normally don't have 200 € left per month? Or only every two months... .

I don't want to speak badly to you ... 90T€ equity capital is also a "big number"!

And what if you normally don't have €200 left per month? Or only every two months ... .

I don't want to talk you down ... €90k in equity is definitely a "big number"!

Sorry, but if I have someone with an estimated gross annual income of €100k in front of me and this person (family) can only afford €800-900 for rent/mortgage, then something is wrong with the lifestyle. There is no car either (train rides should be cheaper than the car - calculated overall), what happens to the money? What do you do if the salary is less sometimes?
With that income, €90k in equity is actually quite little - my experience as a banker. There are basically only two reasons for that: a current young family or having lived well. The latter fits again with the self-reported high expenses.
Now a short word about the costs. Is there even a basement included in the house price of €157k? We build very large and thus achieve quite low prices, but €1,200/sqm including basement doesn’t seem realistic to me. Apart from that, the house is simply too small for 5 people.