Purchase Financing Single-Family House 120 sqm / Feasibility Assessment

Hello,
my partner and I have found a property that suits us. Attached I have included our cost breakdown to clarify whether this is feasible. At the very bottom, there is also a table with the cost breakdown.

General information about you:

[*]Who are you? (still) unmarried couple
[*]How old are you? She 27 / He 28
[*]Are there children? No
[*]Are children planned? Yes, in 2-3 years
[*]What do you do professionally? She retail salesperson / He civil servant
[*]Are you employed? She employed / He public service
[*]How many hours do you work? She 30 h/week / He 40 h/week

Income and asset situation:

[*]What income do you have (gross/net)? She 1800€ net plus 13th salary / He 2800€ net plus 13th salary
[*]Rental income? Condominium 100€ (after deducting loan installment / remaining debt: 100,000€)
[*]How much equity do you have? 55,000€
[*]How much equity do you want to put into the house project? 50,000€

Expense situation:
Expenses already included in other items can of course be omitted. This list is not exhaustive and can be extended or summarized at will. Please make sure to state all costs monthly, even if they occur only annually!

Housing costs:

[*]current cold rent: 500.00€
[*]current warm rent: 650.00€
[*]electricity: 50.00€
[*]gas: included in warm rent
[*]water, sewage, waste disposal fees, street cleaning: included in warm rent
[*]telephone, internet, mobile: 65.00€

General information about the property:

[*]How large is the property? 700 sqm
[*]What are its dimensions?
[*]What is the standard land value?
[*]New build, old building (year built), house type? Old building built in 1990
[*]Garages? 1
[*]How big is the house? (living area / usable area): 120 sqm living area; 140 sqm usable area

Construction or purchase costs:

[*]Purchase costs: 430,000€
[*]Ancillary acquisition costs: 40,000€
[*]Renovation and/or restoration costs: 10,000€
[*]Total costs: 470,000€

Other costs:

[*]Kitchen costs: -
[*]Furniture, lamps, decoration: -
[*]Other "non-acquisition, acquisition annex, construction or construction ancillary costs": -

Cost summary:

[*]Total costs: 470,000€
[*]Deductible equity: 50,000€
[*]Financing amount: 420,000€

Necessary loan details:
(if there are multiple components, provide details for all; if there are multiple variants, please clearly distinguish them):

[*]Loan amount: 420,000€
[*]Remaining debt at end of interest period: Fixed interest rate until end of term
[*]Assumed total term until full repayment: 30 years
[*]Monthly installment: 1,550.00€
[*]Are special repayments possible? Unlimited
[*]Is loan rate adjustment possible? (Conditions such as number, repayment rate range specify): No

Income			Income			Total Income
Salary:	2,800.00 €		Salary:	1,800.00 €
Rental income	780.00 €
Total income	3,580.00 €		Total income	1,800.00 €		5,380.00 €
Expenses			Expenses
Insurances			Insurances
Private health insurance	260.00 €
Accident insurance	12.00 €
Private liability insurance	9.00 €
Legal protection insurance	13.00 €
Car	27.00 €		Car	20.00 €
Total insurances	321.00 €		Total insurances	20.00 €
Car 1			Car 2
Tax	18.00 €		Tax	10.00 €
Fuel	300.00 €		Fuel	100.00 €
Repairs/Maintenance	150.00 €		Repairs/Maintenance	150.00 €
Total Car 1	468.00 €		Total Car 2	260.00 €
Condominium			-
Loan	505.00 €
Additional costs	310.00 €
Property tax	16.00 €
Reserves	50.00 €
Life insurance	9.00 €
Total condominium	890.00 €
Living costs
Groceries	800.00 €
Leisure	200.00 €
Mobile contracts (2x)	30.00 €
Clothing	50.00 €
-
-
-
-
Total living costs	1,080.00 €
Single-family house
Loan	1,550.00 €
Electricity	50.00 €
Heating/Hot water	50.00 €
Waste collection	7.00 €
Heating maintenance	30.00 €
Chimney maintenance	10.00 €
Property tax	30.00 €
Broadcasting fee (GEZ)	19.00 €
Water/Sewage	40.00 €
Street/sidewalk cleaning	20.00 €
Internet	35.00 €
Insurances	30.00 €
Maintenance reserves	150.00 €
Total single-family house	2,021.00 €
Total expenses	5,060.00 €
Disposable	320		plus savings:	500.00 €

To be honest, I didn't even look at the numbers from you. €4,600 net for a loan of T€ 420 is not a ratio worth considering. Take a long fixed interest period, please 40 years term (which is about 2% repayment) with the option for special repayments and look forward to the house.

According to your calculation, it looks feasible. The additional costs for the house, especially for electricity and heating, seem a bit low to me. That can quickly be 100€ more. Especially with rising energy prices. If children come, it could get tight. But maybe your salary will increase a bit by then? Are you sure that 10,000€ renovation costs are enough? Can you move into the house without major renovations? With the year of construction, people might prefer to renovate the bathroom or install a new kitchen right away, unless that has already been done in recent years. When moving from an apartment to a house, you often need new furniture, lamps, etc.

Honestly, I didn't even look at the numbers from you. €4,600 net for a €420K loan is not a ratio you need to think twice about. Take a long fixed interest rate, please 40 years term (that's about 2% repayment) with prepayment option and look forward to the house.

I'll play the party pooper: €4,600 until the child. And then? Parental leave, then continuing 30 hours/week or rather less? Calculate how it would be during parental leave...

: Yes, that's true, we should calculate with an additional 100-200€ per month. By then the salary will be significantly higher, I am expecting an increase of about 400-500€. At the same time, fuel costs of 300€ and the second car will be eliminated.

Yes, we can move in without major renovations, only a new floor and painting work need to be done. Most of the furniture is already available, the rest will be acquired step by step :)

: At that time, on the one hand, 300€ for fuel as well as the second car would be eliminated. At the same time, I should be earning 400-500€ more by then. After that, 30 hours should continue to be worked, which can be arranged well due to our working hours.

Good evening,

so income-wise it still fits well...

currently, I see several construction sites here:
financing expiration (equity: €50,000, but most of it goes into incidental purchase costs €40,000)
so you are rather at over 95% financing.
With 95% financing, you currently calculate about 2.00% interest for 10 years, with KfW you probably get to 1.70%.
Long interest lock-in, so 20 years or more, and you are already at 2.50% or more... if you then take 2% repayment, the rate would be €1,575
(so it still fits into the household budget!)

You indicated above:
repayment change is not important... personally I have a different opinion on that.

Your household income, including rental income, is currently: €5,380
if a child is added = initially €1,800 drops out, €219 child benefit is added; also for 12 months parental allowance about €1,200
in total: income goes down from €5,380 to €4,999 (so €400 less per month!)
for that, you have a child, which costs a lot more (initial equipment, diapers, clothes, and so on...) so you should already calculate costs of about €300-400 per month here.
and suddenly, you have €800 less monthly... that means no more saving... and hopefully you have enough reserves for the new car, vacation, or if something needs to be done to the house.

Of course, you can say: we get married, and through tax class change you can compensate part of it! (that would be an idea!)

HERE A TIP:
Get married, when planning children the woman goes into tax class 3 (more NET) and the man into 5 (less NET) monthly, at first you have less in the pocket, but it gets balanced out through the tax return.
Advantage: the woman then has about €200 more net per month = then also €130 more parental allowance in the pocket...
(that's how far it is in Germany, that you also have to "financially" plan children...)

So I can only recommend taking financing with repayment change here.
and maybe then also a bank where the €1,550 is not the minimum repayment, but maybe less as well.
Personally, I would not focus on the best interest rate here, but rather on flexibility.
Because it is nice if you can calculate now with a €1,500-1,600 rate, but if it gets tight, then 200-300€ lower rate helps a lot...

because in the above example, the parental allowance only flows for 12 months, so what happens after that? The woman must work for at least 20 hours/week or longer to have the same income. Then the question arises here: do you have no childcare costs (kindergarten, daycare mother) or yes? Because then the woman must earn at least more money than parental allowance to cover the childcare costs, the travel costs to the workplace, and the loss of parental allowance.

One should work to live... not live to work ;)