How much land and house can we afford?

Here is another question for clarification:
Are the plot of land and the house purchased from the same source? I had read it as the plot is bought and then a company, independent from the land seller, is commissioned with the construction of the house.
Then the OP's calculation regarding property tax would be correct. He only pays the tax on the land purchase.
However, if the plot and the house are acquired from the same source, the property tax must be paid on the entire amount.

Yes, theory and practice are indeed two different things... if no significant time has passed between the purchase of the land and the house... then both are considered a linked transaction even if they come from two different persons...

That used to be the case... where the house and plot were bought separately and the tax was only due on the land... but that has long been over... especially in and around the federal capital this procedure is known to the authorities...

Yes, theory and practice are two different things... if no significant time has passed between the purchase of the land and the house... then both are considered a linked transaction even if they come from two different people...

That was once... when house and land were purchased separately and tax was only due on the land... but that has long been over... especially in and around the federal capital, this procedure is known by the authorities...

Well – I don’t know about the procedure in Berlin.
We bought the land from the municipality in 05/2013 and only paid property tax on the purchase price. Construction will start with us in 03/2014 (finally).
As a precaution, I asked again before buying the land (you want to be informed) and only met with astonishment about this question.
My general contractor has already built houses in the development area – he has not heard anything about it from his clients either.

As I said, I can’t say how it is in notoriously cash-strapped Berlin. But I think such a notice would be contestable.

Good evening,

Yes, theory and practice are two different things... if no significant time has passed between the purchase of the land and the house... then both are considered as a linked transaction even if they come from two different persons...

Where did you get this wisdom from? Current case law says something completely different...

That was once... when house and land were bought separately and tax was only due on the land... but that has long been over... especially in and around the federal capital this approach is known at the authorities...

Once again - where do you take this "knowledge" from? As far as I know, these judgments: "Judgment of 23.8.2006, II R 42/04, BFH/NV 2007 p. 760 and decision of 2.4.2009, II B 157/08, BFH/NV 2009 p. 1146" have not yet been questioned by more recent decisions.

Rhineland greetings

The information is first-hand, my neighbor who built one year before us is employed by the association and receives the applications on her desk daily... very few people in Berlin only pay taxes on the land.

Since there is an economic connection between the land and construction contract, the tax office will also levy the real estate transfer tax on the house price.

Hello,

The information is first-hand, my neighbor who built one year before us is employed by the association and receives the applications on her desk daily... very few people in Berlin pay taxes only on the land.

Since there is an economic connection between the land and construction contracts, the tax office will also levy the real estate transfer tax on the house price.

That is still not correct and it is advisable for the affected builders to consult a lawyer; unless ...

... there are municipalities - Berlin may belong to this, but this is beyond my knowledge - that mandate a period "x" between the purchase of the land and the start of construction; otherwise, the real estate transfer tax on land purchase and house construction is waived.

For all others, in my opinion, the case law of the BFH applies "A separate treatment and thus tax only on the land is _only still_ conceivable if the new owner himself looks for a suitable construction company and there is no connection to the seller of the land" or also that of the Lower Saxony Finance Court, judgment of 08/26/2011, 7 K 192/09, 7 K 193/09.

If I remember correctly, this discussion flared up again not too long ago between the parties and has (still) not changed the outcome.

Rhenish greetings

Thank you very much for the additional contributions, especially regarding the property transfer tax; I will definitely inquire again whether and how it can be avoided, as the amounts involved are quite substantial.

Regarding the ancillary construction costs you mentioned, I have already sent out further inquiries and hope to be wiser here soon.

Where I still feel a bit uncertain now is the house price estimate. mycraft, you wrote that in Berlin you come to about 1400 euros/m2 for a fairly high standard and that prices also vary significantly regionally within the city (?). Since the equipment and construction company are not yet fixed for us, of course I hope for some leeway here myself. Would you like to send me a PM about your experiences? And/or can others confirm whether a price below 1500/m2 would be realistic for this area without short-sighted quality losses? Or would it be naïve in Berlin to plan for less than 1500/m2?

I know that it ultimately depends on our decisions, but as a newcomer such things are so hard to assess. At the moment I assume that we will hardly manage any extraordinary own work, but on the other hand we also have rather simple requirements for the equipment... of course we don’t want rubbish quality, but for example we don’t need designer tiles or electric shutters etc.

Best regards,

Kazazi