Is building a house financially feasible?

The budget could become very tight. Although we approached the topic of house building very disciplined and built a prefabricated house, where the costs "actually" are already fixed beforehand, we spent about 40 TEUR more than planned. Due to rather poor soil conditions, we had to spend about 15 TEUR more.

Leasehold from the church is okay. Nevertheless, I would never do it if there are other options. For me, capital preservation is also the priority when building a house. I also want to have value in 50 or more years. The increase in value usually occurs through the land. The house itself is usually worth less then. Therefore, it would always be important to me to own the land itself.

I wouldn’t plan so tightly. How often do you hear that the budget was quickly exceeded? What will you do if it turns out during construction that it actually costs 350,000? The risk would be too high for me, then you’d already be at a 1,200 euro installment. And if after the second child the woman’s income disappears completely because she was bullied out after parental leave (this has happened to several mothers I know, they then resigned themselves because suddenly weekly business trips were scheduled on weekends and meetings late in the evening and such nonsense). Then you’re left with 2,000 euros for a family of four and can barely make ends meet. I would never do [Erbbau] either. The installment for the land stays and what if it suddenly gets raised sharply? The house wouldn’t even belong to you then, there are no houses, only built-up plots, and the plot doesn’t belong to you. No, I would never do that. That’s even worse than [WEG]. And who wants to buy something like that if you ever want to sell? Then better an old building that is in good condition. At least the costs can be calculated there (have an expert check it beforehand!).

?.. I would never do leasehold either. The rate for the land remains and what if it is suddenly raised sharply? You don’t even own the house then, there are no houses, only built-up plots. And you don’t own the land. No, I would never do that. That’s even worse than condominium ownership. And who wants to buy something like that if you want to sell someday? Then better an old building that is in good condition. At least you can calculate the costs (have an expert check beforehand!).

But of course you are the owner of your house! You are not expropriated or fall victim to other bizarre things. Everything is contractually regulated – and in some areas completely common practice. And the rate.... The rate can turn out to be cheaper in some situations than financing an outrageously expensive plot of land. If it’s not "your thing," okay, but please don’t write nonsense!

Thank you very much for your honest opinions. We had another appointment with the construction company. I have already come to terms with the fact that 250,000 won't be enough. However, I am somewhat dissatisfied with the behavior of the construction company. It was said that we would receive offers around 250,000 including the land. Essentially, nothing under 300,000 was offered to us. I would have preferred if this had been communicated to us at the initial meeting. We would (after discussions with the bank) easily get a loan of 300,000, possibly even more, but I don't want to go completely to the limit. You are right, so many unforeseen things can happen.

Furthermore, we were informed that there will be immensely high development costs on the leasehold land. When we asked about this at the initial meeting, it was said that the development costs were included in the house price as a flat rate. Now they amount to about half of the land price extra.

In our case, leasehold is not unusual. Of course, I have concerns about it, which is why I asked for your opinions. But it is common practice here. The term is 80-99 years. Before signing the contract, it must of course be clarified to what extent the lease costs can be increased and whether this is contractually fixed.

At least you can calculate the costs (first get an expert through!).

You can calculate a lot.

The increase in value usually occurs through the land. The house itself is generally worth less. Therefore, it would always be important to me to own the land itself.

If you don’t spend money on the land, there are no values to maintain or even increase. The house is worthless after a few decades anyway if it is not consistently renovated.

With leasehold, you can then invest the money elsewhere.

But of course, you are the owner of your house! You also don’t get expropriated or fall victim to other strange things. Everything is contractually regulated - and in some areas it is completely common practice. And the rate... The rate can turn out to be cheaper in some situations than financing an outrageously expensive plot of land. If it’s not "your thing," okay, but please don’t write nonsense!

Ownership of the house is proven by the land register. However, the land register only contains plots of land and no houses! After the leasehold period ends, the house belongs to the lessor (there is compensation, but it only has to be 2/3 of the market value of the house, which in the case of an older house can easily be close to zero)!