Inherited equity, what to do, experiences?

Even if the specific project here is not interesting to many, I have learned some spicy things there that could apply to other new construction projects by developers:

Google "Ratingen Spiegelglasfabrik." It is a new development area in the city of Ratingen. In my opinion, it is too expensive. They haven't been able to fully sell the houses for quite some time now. I can imagine there is room for negotiation.

I looked into it as well, although it is actually too far away for us. There is no room for negotiation. At first, this puzzled me, but later I realized after talks with residents who have already moved in and construction workers:

1. The discounts advertised so far are no discounts at all. Neighbors told me that they observed this too – but with the price reductions, various included services were removed.

2. The reason why no negotiation takes place was learned at the construction site: Most of the started houses (about 30% of the neighborhood) are already occupied or near completion – the majority or all of them are sold. New houses are only started to be built when they are sold. Currently, sales are not made with "free choice of lot," but always in such a way that new houses are "added on" to already sold houses. It is doubtful whether the neighborhood will be completed at all.

The latter information is particularly interesting. Before, I had not heard (not even here in the forum) that single-family home developers, after acquiring the land, simply do not build (even though they are still solvent).

Ah...thanks for the update. Very interesting. Coincidentally, I will be in Ratingen early tomorrow morning. If I have a few minutes, I'll take a look at it. Then the "few still available" houses on the website always seem to be exactly those that are next in line for construction in the terraced house project. The plot numbers are indicated there. I only wonder why, for some houses, they have limited the selection of equipment options per se. I thought they already had quite advanced construction progress...

Especially the latter information is very interesting. Previously, I had not heard (even here in the forum) that single-family house developers simply don’t build after acquiring the land (even though they are still solvent).

This has probably become more common since the interest rate increase. For the developer (no matter how solvent he may be), construction certainly also relies on loans. Interhomes surely does not want to take on that risk. They just had a bit of bad luck. Paired with a bit too much optimism on rising prices. The marketing phase started at a time when the interest rate was still low and the houses were being snapped up by buyers. The fact that this was not the case there is telling. Interhomes will probably now have to show stamina. Demand will come back. If prices remain stable, it’s already a discount due to inflation.

Cool that you found the old thread so quickly and replied!

Of course, I know that only a few people in the forum know this specific new development area, so everyone is invited to reflect the discussed topics on projects they themselves know.
In general, the Spiegelglasfabrik seems very special to me in several respects. The developer praises the location highly and emphasizes how rare it is to have "such a central" new development projects – moreover in a city where there are otherwise neither NBG nor plots of land (the latter seems to be true). But the location? I mean, the NBG borders DIRECTLY on the most heavily trafficked freight rail line far and wide. And it is truly MASSIVELY trafficked. Everything heading towards Rotterdam goes through there. And unlike the people plagued by freight trains in the Rhine valley, here there isn’t even passenger traffic that would compensate for the noise.
Then it goes on: highly praised public transport connection (tram). Yes: in a straight line it’s not far – but because of the railway line, you can only get there via several traffic lights with endless pedestrian red phases and a long bridge – about 1 km. Apart from a supermarket and an elementary school, nothing is reachable on foot. The bike path to the center runs along a heavily trafficked main road – and cannot be bypassed even with significant detours.

Now about the houses: the models offered are so stripped down in the basic equipment that you pay a hefty six-figure sum just to get a family- and home office-suitable floor plan. Including additional costs and finishing work, you quickly end up with seven figures. Most houses cannot even optionally be equipped with a garage.

Over 1 million euros for an ugly house, right next to the freight railway without special locational advantages – who buys that??
Maybe die-hard residents of Ratingen can find some appeal in the location. As a "stranger," I could not recognize the immense attractiveness.

Also interesting: the already finished very long block parallel to the tracks is already fully occupied. About 90% of the names on the doorbells are Indian and Chinese. Could it be that Huawei or some IT company from Düsseldorf bought the houses as company apartments? That would plausibly explain why the marketing was more successful there.

The marketing phase began at a time when interest rates were still low and the houses were snapped up from the providers. That this was not the case there is telling.

I don’t quite understand what you mean by this, but it sounds extremely interesting. Why weren't the houses snapped up from them? Is it because of the reasons I mentioned above?

Cool that you found the old thread so quickly and replied!

The email notification works wonders :)

I find what you write extremely interesting. And I actually believe that some others also find the situation in other new development areas interesting.

I see it like you do: the prices of the houses were set too high. Here, they completely relied on the macro-location. It’s very close to the Düsseldorf city border. Plus one of the extremely few new development projects in Ratingen.
The people from Ratingen are very loyal to their hometown. They all really want to continue living in Ratingen and already have serious problems with having to move away from their traditional district.
Then come the people from Düsseldorf and employees of the many companies based in Ratingen.
And here we come to your point: right next door is the Grachtenviertel. (Which I find very nice). In the last decade, everything that came onto the market there was bought up by Japanese and Chinese companies. They then put their expats there for a few months. Until the next ones arrive. The residents don’t like this so much because it hardly allows for long-standing neighborhood communities.

Very interesting that they are now also buying the houses at the Spiegelglasfabrik...

Back to the location: it’s not bad at all. Supermarket, elementary school, kindergartens (the latter should also be built in the new development area) within walking distance. Plus the Green Lake also within walking distance. The (really beautiful) city center is 1.8km away.
The airport is about 20 minutes away by public transport. Düsseldorf is also relatively quick and uncomplicated with public transport (to the old town without changing trains in 30 minutes).
Viewed in isolation, that’s all pretty good and nitpicking at a high level.

And now the but: I absolutely agree with you. The railway line next door is not exactly deluxe. But I can’t assess how much traffic goes by there.

The bike path to the center runs along a heavily trafficked main road – and can’t be bypassed even with significant detours.

hm...that's unfair. Ratingen is simply a city. Show me a city where you can ride a bike through green meadows all the way to the city center. Especially since we’re talking about the last 1.8km to the city center here. With some detours, I could even show you a route where you ride about 80% through single-family home areas.

But whatever.
We agree that the prices were set too high. Interhomes thought they could ask for almost any price. It did seem that way back then. But they tightened the screw too much and then had bad luck with the interest rate turnaround.

Great insights, thanks!

And this brings us to your point: right next door is the canal district. (Which I find very nice). In the last decade, everything that came onto the market there was bought up by Japanese and Chinese companies. Then they put their expats there for a few months.

This phenomenon was unknown to me despite several years of market observation. Even in my above post, I had only speculated. Well, well. I would have rather thought that Huawei would buy a block of flats in Oberkassel or Heerdt to accommodate its expats.
But if it’s going to be a single-family house, then in their place I would also buy new builds. The canal houses on the market are quite run-down and in extreme need of renovation. Do these (non-expert!) Asian company gentlemen have the patience to completely renovate German single-family houses from the 70s/80s?

And now the but: I absolutely agree with you. The railway line next door is not exactly deluxe. But I can’t assess how much traffic goes along it.

During my conversations there, there wasn’t 5 minutes of quiet. The railway workers call it, I think, “train succession at block intervals.” Even if you’re prepared to get used to it – with (exorbitant) rail noise, I actually think of the (decades-distant) resale when buying new.

We agree that the prices are set too high. Interhomes thought they could charge almost any price. It also appeared that way back then. But they turned the screw too tight and then had bad luck with the interest rate turnaround.

Well, but what could they reasonably do now? Just sit on the plots and (possibly for years) do nothing? Is there no building obligation?
In their place, I would sell the plots to private individuals. That would give them a real unique selling point – with which they could probably tap considerable willingness to pay (from the few equity-rich interested parties) in the Düsseldorf area. And all that without any own risk.

We agree that the prices are set too high. Interhomes thought they could demand almost any price. It also seemed that way back then. However, they tightened the screw too much and then had bad luck with the interest rate turnaround.

Hello MoHouse, Did you buy back then and are you also affected by the insolvency?