How should I plan to afford this?

Hello everyone,

here is my first post.
I am currently gathering ideas and researching a lot.
However, I have real stomach pains about the topic because I don’t know how to approach it all properly.

I plan to buy/build a house within the next 2-4 years.

Biggest sticking point:
I live in Munich.

If I look at existing houses, a house with a small garden costs from €600,000 upwards.
And these are not the big and new houses in the city center. No, here I am already well outside and have standard.

My search area extends around Munich, I would say +/- 30km.

Now I am considering building myself. But the plot alone is hardly affordable. Wish is 500m². We are already at over €300,000.

On this, if we self-build, a prefabricated house with a basement and a granny flat for renting will be built. ([Later the parents will move in here].)
Here I expect costs of €300,000 for the house.

Current financial situation:
Couple in their mid-30s, no children, living in a financed condominium.
We have a car.
Current income approx. €4500 net. This is calculated conservatively without Christmas bonus and without future increases.

When selling the condo, I expect to free up equity of approx. €150,000.
However, early repayment penalties still have to be deducted here. But I will neglect this for now because it is not certain when the purchase/sale/building will take place.

A rate of €1600 is easily manageable; I do not want to calculate on a tight budget.

I know no one here can see the future, how prices and interest rates will develop.
But my concern is what I have to do to afford this in the next few years.
Even with €150,000 equity, I don’t have a good feeling.
Saving much more additionally is not possible. We will be able to save the incidental purchase costs by then; the rest of our income will be used for paying off the current apartment and maintaining/increasing its value.

There is currently a relatively new building savings contract. But I would also neglect that.
[Wohnriester] is out of the question; I find it very unsympathetic.

What do you think? Does it make sense to hold on to the dream, or is it utopian?
I want to know what I can do NOW to achieve the goal in the medium term. And of course before we turn 40.

Thank you very much!

Sorry that now there is only a setback, but with 300k you will hardly manage if the basement and granny flat are to be included.

Move to Hof
No, but seriously – you can definitely finance 500,000 € with 5,000 € net income (e.g., 2% interest and 2% repayment = 1,670 € per month). Real estate in Munich is just expensive. What can you do now? Keep your eyes open for used properties, keep saving.

Nathi is right, for 300k there is neither a granny flat nor a basement. And a prefabricated house is not necessarily cheaper than other construction methods.

As a comparison example: We currently have a calculation for a prefabricated house with timber frame construction, 150sqm living space, 1.5 floors, WITHOUT a basement, including heating system --> €250,000. And that was before the selection of fittings, which usually adds some more € as well. The kitchen is also missing there, as well as outdoor facilities, garage, etc. €300,000 for your ideas are unfortunately not feasible.

Ok, thanks for the initial assessment. I must have miscalculated a bit. I looked through some offers, the house was about 200,000, I estimated 50k for the basement, and I also thought the granny flat would cost around 50k. But okay, then I’ll have to reconsider that. I’ll visit a model home exhibition soon. We won’t be doing much of the work ourselves. It’s mostly limited to painting walls and laying floors. I would also initially neglect the outdoor facilities. But more than 600k seems quite steep to me. That was my personal pain threshold. Maybe then it’s better to save something on the plot after all.