Prefabricated house - Yes or No?!

First of all, I throw a hello into the forum!!!!

Now to my questions:
My girlfriend and I have been thinking about building a house. My girlfriend earns a net of 1250 euros and I have a base salary of 3050 euros net. Together that's 4300 euros. From that, 1300 euros of liabilities are deducted. Equity is about 5000 euros.

In 2006, I already built a three-family house with my parents and my brother. The house is worth about 500,000 euros. At the moment, I live in the attic. But in the long run, everything is getting too tight for me. That's why the plan for a single-family house. The existing loan will be taken over by my brother.

I have already obtained a few offers on the topic of prefabricated houses. Including the plot, I'm at about 290,000 euros. A chunk of money!!!!
I would just like to know what you think about it....... is a serious trip to the bank worth it or should I save myself that for now? I have already received an offer, but without real intentions so far.
I have probably forgotten to write down many important pieces of information, so if you need more info to properly assess the situation.... please let me know.
Thanks!!!!!!!
Greetings from Trier

290,000, but the land is not very expensive. For a prefabricated house with about 130 sqm of living space, you should calculate at least 200-230,000 €. Only 5,000€ equity with 4,300 € net income? What do you do with the money, are there any other liabilities? Car loans etc.? On the topic of prefabricated or solid construction, you will find a lot here in the forum if that is your question.

Here are several posts from which one can deduce which information is usually important to receive a useful answer.
Building a house always involves a lot of money. You should invest a few hours and read up, then try to provide all the information you think is important.

Are the €290,000 offer costs including the plot of land also inclusive of all additional costs?
That will be a well over 100% financing with the equity. Banks charge a considerable interest surcharge for that.
What does the bank’s offer look like? Not in detail, but in terms of amount needed, loan-to-value ratio, interest and repayment rate. Maybe feasibility can already be deduced from that.

What is your monthly budget for the obligation to the bank?
Children (existing / planned)? Possibly factor in income losses because of that?

First, you should create a calculation for yourself.
List all costs (monthly, yearly, or other), add a few percent buffer. Deduct reserves for car, and house maintenance, all additional costs and insurance from your income.

With: I have €4,300 income, of which €1,300 liabilities are deducted, it’s not enough. Besides liabilities, there are also necessities. These include: food, hygiene, mobility (train, car, whatever), something to wear.

The only important thing in the calculation is honesty towards yourself. Not just extrapolating the costs of the last shopping trip.

There should at least (if you want to still live to see the last installment for the house paid to the bank) be €500 per €100,000 financing needs left over. In your case, about €1,500 / monthly.

If that is not the case, going to the bank is probably only of limited use - my personal opinion. Surely you can manage with about €1,000 / month, but then you will also be paying it off for quite a few years longer.

Then, besides the financing needs, the bank also considers: your age, fixed interest period, KfW programs, job security and income, the location of the property, as well as realism or ignorance.
All are risk factors.

Hello!!!! Thanks already for the honest assessment. I am also very glad that you replied.

Lately, I’ve been hearing a lot from my circle of friends ..... I’m building a house now, the bank is giving me money and it’s so cheap!!! Well !!!! I think anyone who goes to the bank and needs money to buy/build a house will also get money unless they have a SCHUFA score of 60%. What I actually want to say is that I take your suggestions very seriously. I’m not a gut person who decides immediately. Before I make such a huge investment, a lot of water has to flow down the Rhine.

@the one: so what do I do with my money??? As I wrote above, I helped build a house 6 years ago. The house was built through a lot of personal work and a lot of equity (in total it was 130,000 Euro). That’s why it was very cheap. At the moment it’s worth about 500,000 Euro (just the land value in Igel is 180 Euro), but we paid 110 Euro. Recently our neighbors bought a neighboring plot for 280 Euro!!!!

Of course, I also save a lot, have a fund that has been running for quite a while. I didn’t actually want to touch the money. In addition, the plan is to sell the house in 4 years. That way I would get about 50,000-60,000 Euro, the rest goes to my father. I wanted to make a special repayment with the money. Would that be possible??? @emer: so the 290,000 Euro includes everything. Even a buffer of about 15,000 Euro. The plot costs 65,000 Euro. Of course, then it won’t be a luxury house, but I’m not tempted by luxury anyway. Good standard. About the loan offer: effective annual interest rate: 2.72% Fixed interest period: 10 years Annuity rate 1014 Euro Initial repayment 2% I have already created a detailed list of my expenses for myself. I calculated everything up and then wrote it down. Job security??? Unfortunately, no one has that nowadays, but if you take that as a risk, then probably no one can build a house. Well, I think that’s it now!!! Thanks again!!!!

A one-time special repayment is only possible if it was also agreed upon. Normally, banks allow 5% annually. If you negotiate, even 10%. If you still get money out, then your equity is much higher than stated. With your income and your equity, I see hardly any difficulties in building. You can forget about standard land values. Even if someone paid €280, banks unfortunately often see that very differently. In our village, plots cost around €200-250/sqm. 4 km further, almost €300 again. We bought at €130, but the bank uses the standard value of €70. Why, we never found out. I would seriously consider an interest rate lock for only 10 years.

Regarding the house sale. Presumably, you are aware of the 10-year periods since you built 6 years ago and want to sell in 4 years. Nevertheless, a precautionary note: If you sell within 10 years, the difference between acquisition and production costs and the sale price is taxable. If the loan has not yet passed 10 years, you also have to pay a prepayment penalty.

If I were you, I might split the loan. A short-term (e.g., 5 years)/variable loan that you can repay with the house sale and a long-term loan.

Does the fund yield more net return than the interest you can save by having more equity if you were to liquidate the fund plus the interest surcharge for 100% financing on the remaining loan amount?