Is a single-family house in the greater Stuttgart area at all feasible?

  • Erstellt am 2015-05-16 22:12:03

DeMoehn

2015-05-17 10:51:12
  • #1
Good morning everyone, thank you very much for your already numerous responses, that already helps us a lot.

We are also aware that such an undertaking (and we are not talking about right now but in about 2 years) is not the "normal case" and can be risky. However, a typical terraced house with a "towel garden" is not an option for us. We both originally come from other regions where you can already get a whole house (used) for the price of land in BaWü. We have both also grown up in owner-occupied homes and would not want to miss that (at least in the future). Simply moving to a more rural area is probably not possible for professional reasons either. Only the metropolitan areas of Frankfurt or Cologne would still be conceivable, which I think will not change the prices much.

You will have to explain the matter of equity to me again. Of course, I understand that more equity is basically sensible. Lower interest rates (because of increased security for the banks), less risk for oneself, lower installments/terms, more negotiating power. Often you read about 20-30% equity, which would be about 120,000 EUR for the previously planned 400,000 EUR. If we really gave up on a lot here, we might save about 1000 EUR per month. That would be 10 years until we have the money together. However, by then we will have also paid 114,000 EUR in rent (without rent increase for now). That means we have lost 114,000 EUR. (123,128 EUR with 1.7% increase)

If we now lived in the owner-occupied home and amortized 1500 EUR per month at 2.07%, then in 10 years we would have "only" lost 43,170.95 EUR but saved/paid off almost 137,000 EUR. Now, of course, one could also take into account that today the interest rates are really low at about 2% for 100% financing, and in 10 years we will certainly be back at 3-4%. At 3.5% that would result in a loss of 31,400 EUR. Of course, it is quite possible that we have forgotten some things here, which is why we are writing this thread.
 

Legurit

2015-05-17 10:56:37
  • #2
If you could now set aside 1000 €, if you limit yourselves, you should think about what you could set aside if you don’t limit yourselves too much... +970 € cold rent - 150 € for additional housing costs then possibly not enough left for 500,000 € loan, interest and repayment... simply put: 500,000 € will cost you 1040 € interest per month alone at 2.5% interest... you certainly don’t want to repay 1% either - more than that probably won’t be possible for you. Therefore, your business case is rather questionable if you can barely set aside 1,000 € at most.
 

milkie

2015-05-17 11:07:07
  • #3
Is renting really that bad? You first have to find yourself and get a foothold in professional life. This has nothing to do with generational clichés. I believe that you should only live as you can (currently) afford. Just because there are low interest rates doesn't mean you have to build?!? Oh, and on the topic "people have to give up their house due to separation": Do you know the reason for the separations? Maybe it's financial disagreements or dissatisfaction with the lifestyle/housing style?! ;)
 

DeMoehn

2015-05-17 11:27:24
  • #4
Regarding what we can save, 1000 EUR together is not an exaggerated amount, sorry, it really read differently. So far, we both already save 300 out of 800 EUR each; even with a savings rate of 500 EUR per person, we would still have 300 EUR per person every month to do whatever we want (going out, etc. is paid for with the other money).

So far, we assumed having to pay 1800 EUR "warm rent" for the single-family house, which would be 600 EUR more than before, meaning we could probably still save 400 EUR per month (given the current income situation). The question is whether it is somehow possible to build something reasonably decent here for 400,000 EUR. If we need 500,000 EUR instead, we will actually have to improve our equity and income by a good margin.

: No, renting is basically not a problem. However, I have already lived for 3 years in a 45sqm apartment in Mannheim, and for study purposes also 3 months each in Cologne, Düsseldorf, Stuttgart, and Frankfurt. So we have already found our "feel-good place" here in the region. I have been working for this company for about 5 years now. In at most two years, I should have "established myself" there. I actually don’t want to rent for a much longer time than 2-3 years anymore, due to the aforementioned loss of money without any benefits. Besides, we will, of course, get older, and we probably won’t pay off in less than 25-30 years here. I’d rather be done by my mid-50s than just before retirement.
 

smodon

2015-05-17 11:42:18
  • #5
how about alternatively an apartment? Pay it off aggressively and then use the equity for a house construction in 10-15 years...
 

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