Is purchasing a house and complete renovation affordable?

Exactly. One should enjoy life in the years…

The OP describes two scenarios: Either buy the house now, or otherwise be evicted from the expensive rented 3-room apartment with his two unborn children. To me, that does not read like a rational consideration of a 700,000 euro investment.

Even though I don't see the monthly burden quite as bleakly (we don't have a detailed expense breakdown, but in my opinion even with 3k for additional costs and living expenses there's room for reserves, even if that's certainly not generous and everything isn't as relaxed as before - my advice would be to at least make a more precise breakdown for yourselves). But I'm biased here, we have a similar financial burden. I can also understand if the conclusion for someone is "nooope, that's too sketchy for me." But I see this point the same way. "We basically have no other choice than to do it this way" is simply not true. Yes, if with a potential second child in 5 years the rented apartment becomes too small, then you can still look for something new at that point (this was presented here as basically a no-go and I think to myself "in what world is THAT the doomsday scenario?") or potentially then build/buy. There is a choice, the breakdown by is already much more comprehensive. So there are reasons for Grandma’s house, that’s not the issue. First of all, it is a (for the location) inexpensive house in an area you probably couldn’t afford otherwise. Maybe other family is nearby as well. Maybe the house also has some sentimental value for you. But take the mentioned problems seriously and decide consciously if you want that, and also weigh the alternatives in your mind, to then decide consciously and not as an act of desperation.

I haven’t read everything yet, but:

- With your income, a 2000+ installment would be too much for me. We currently have just over 6 net with parental leave loss (2 children) and manage well, but 700€ less would already mean restrictions.

- Please also consider that parental leave, depending on the city, only amounts to 1 year with perfectly timed children, otherwise longer. In our case, daycare centers only accept children in August and only from 1 year old... with child 2 (born in winter) we are therefore having longer parental leave now (yes, sometimes there are alternatives).

- I don’t know if this has already been discussed, but: on the other hand, when renovating there are quite a few subsidies to be claimed. We are currently renovating ourselves and heating is, for example, the biggest cost item (about 80k with pipes, radiators, etc.)... but we get 40% of that back. Other individual energy efficiency measures another 20% (either BAFA or through taxes). You should at least calculate what’s included there. Often cities and municipalities also have tenders (with us another 3% for windows and roof).

- We are currently doing a full renovation without the facade (only painting) and waterproofing the basement and end up at 2000€/sqm. With cheaper options, about 1750€/sqm would probably have been possible. But it’s always a case-by-case calculation, with you the sqm price feels higher (60s facade and damp basement).

Is the house in its current condition "uninhabitable"? Otherwise, I suggest the option that you buy it, renovate it a bit, and consider it as a temporary solution. As 11ant always so nicely writes....Zwischenhaus ... You have secured the bargain and paid it off quite quickly, and then you can see what to do next.

Forget percentages of the net income. What matters is what remains. And outside of parental leave, we're talking about well over €3000, and even during parental leave, almost €2000. That's enough for more than just noodles with ketchup

I see it the same way. Anyone who earns €6500+X net/month can easily afford to go over 30-35%...

And currently, it is 5400 euros net/month, which is correspondingly reduced during parental leave. And I do not know a single mother in our environment who works full-time, so I would calculate with a maximum of 65% of the woman’s income in the long term.