Land purchase and house construction too risky in the current situation?

If you read the comments and statements of central bankers today, interest rates are likely to rise drastically and especially very quickly. We are certainly heading towards a mortgage interest rate of 6-7 percent by the end of the year. I don’t need a crystal ball for that. In this respect, I would finalize the financing immediately. However, a significant interest rate increase could indeed lead to abruptly falling construction and land prices. Take out a [Forwarddarlehen] and wait.

If you read the comments and statements of central bankers today, interest rates are likely to rise drastically and especially very quickly. We are certainly heading towards a 6-7 percent mortgage interest rate by the end of the year. I don't need a crystal ball for that.

In this respect, I would conclude the financing immediately. However, a significant interest rate increase could actually lead to abruptly falling construction and land prices. Conclude forward loans and wait.

And how is that supposed to work if the construction planning is not finished?

...

Honestly, your forecasts and so on personally scare me a bit. Couldn’t you, with the same enthusiasm, ;-) look out for positive facts regarding house construction costs, etc.? They must exist too. That would certainly not only make me happy. :) (Please, this doesn’t only concern you (this reminder also goes to myself et al.), ;-) refrain from political digressions, otherwise this thread might actually be closed and that would, in my opinion, really be a pity.)

I was only able to read the thread now, but at your age I would look for a bank that allows an adjustment of the repayment rate to 1%. You are still so young, you can, for example, start with a 3-4% repayment (there are often better conditions) and then immediately change to 1%. Mathematically, a very long term, but what the heck. Then at 65 there will be a very small remaining debt. Better than having to shoulder a high rent in old age – you will have to accept (significantly) higher rent in the medium term anyway if the house you have now is too small.

Adjustment of the repayment rate has so far not been offered by our house bank or the possibility was denied. That would of course solve our concerns about parental leave and childcare. Do you know banks where this is possible?

And how should that work if the construction planning is not finished?

Yes, exactly that is our biggest problem. If material prices continue to rise, we have the option to compensate by cutting back on the equipment, but we will not be able to finance a strong interest rate increase. For our loan amount, an interest rate increase of 1% costs us about €500 more per month and we cannot finance that... If we knew today that we would definitely get the interest rate from the last conversation with the bank in 4-6 months when construction planning etc. is all settled, then we would decide for the building plot.

And how is that supposed to work if the construction planning is not finished?

A building permit is not necessarily a requirement for a loan. What you do need, however, is a cost calculation from the general contractor/architect. You don't even have to be the owner of the land, but then of course you have an acceptance obligation for the loan agreement. I had thought about that back then too because I had already signed the contract in January 21, but the land was not yet developed and therefore had not been sold to me by the municipality. For the "new KfW funding," however, that caused certain problems back then ;)

Adjustment of repayment has not been offered by our house bank so far or the possibility has been denied. However, that would of course solve our concerns regarding parental leave and childcare. Do you know banks where this is possible?

Am I mistaken or is it always a repayment adjustment when you can adjust the installment (upwards or downwards)?
We recently concluded this with the VR so that (I think 2 or 3) installment adjustments can be made. That was important to us because our salary situation may improve significantly soon and the overall situation with the war etc. is so difficult... Better safe than sorry.
A few years ago, this was also possible at the S-Cashier.