Question regarding the feasibility of financing

2020-05-09 20:25:01

Especially in Middle Franconia, I cannot understand the high prices in rural areas. Except for Nuremberg, Fürth, and Erlangen, Middle Franconia can rather be counted among the low-wage areas. So those who are not lucky enough to work in one of the three mentioned cities usually earn less (sometimes significantly) than the national average. The prices are still comparatively high. It is very noticeable in our area that the existing houses are mostly bought by outsiders.

2020-05-09 20:47:38

Especially in Middle Franconia, I cannot understand the high prices in rural areas. Except for Nuremberg, Fürth, and Erlangen, Middle Franconia can rather be counted among the low-wage regions. So those who are not lucky enough to work in one of the three mentioned cities usually earn less (sometimes significantly) than the national average. Nevertheless, prices are comparatively high. It is very noticeable here that the existing houses are mostly bought by outsiders.

It's just a spiral. Cologne and Frankfurt are similar. Living centrally with highway access. Everyone is mixed together, and all are commuters with well-paid jobs. The local nurse doesn't live here... everyone moves out, which spoils the prices.

2020-05-09 21:13:27

I have often asked myself the same questions. Our construction project in a cheap big city is currently at around 750k, of which about 620k is a loan, since no wealthy family, no inheritance/gifts, no support, or anything like that. To manage such an amount in a reasonable time, one should preferably choose a 3000 installment (I have never seen this magnitude here in the forum). So I also wonder which professional groups in this country could have afforded this under these circumstances. As I said, a very cheap big city without good employers. When we wanted to choose such an installment, the bank did not cooperate; instead, we now have about 2500€/month and a 10% p.a. special repayment option for free. We are three-quarters through the construction phase, and I think it will not even stay within the budget and some projects will have to be postponed. But without the details, the numbers do not really mean much, because everyone has their wishes and standards. If you are willing to compromise and well connected, much is also possible for significantly less.

2020-05-09 23:03:28

No, all good, I'm not offended. A quick note: if you are two people with 5,000 net income, you don't belong to the top 15% ...

Depending on the statistics. Household net income of 5,000 euros is definitely just above the upper class range [in the IW statistics that would even be the top decile] - whatever that still means today, as we are discussing here.
Last year there were plenty of reports that simply showed that the top 15% are by no means the super-rich, and the level of "normal-high" incomes is quickly misjudged. For example, 3,500 euros net nationwide is already pretty good. And if an additional 1,000 comes regionally on top, incomes are still (unfortunately) "married" in the statistics with incomes ranging from 5,000 to 18,000. In short, it gets interesting in the top 5%, and again in the top 2.5%. There, the entry threshold of 5,000 euros will probably look very meager again.

What follows – with work, one often does not get rich. Incomes in Germany are fairly well distributed (according to the Gini coefficient), but wealth looks different. Noticeable is the capital advantage through, for example, inheritance of sought-after city properties in the last 10 years and their reinvestment.

2020-05-10 11:41:56

I have to say that I find it both surprising and very nice how this thread has developed and how we understand each other and our observations and thoughts about it.

Mittelfranken has, I agree, with Erlangen, Fürth, and Nürnberg really an even more extensive problem (in terms of area), because there are so many large companies there, some of which are actually located more in the countryside. This means you have 3 big cities bordering each other and companies in the surrounding area. You have to go either east or 30 km away from all three cities to get below 500k€. I also find that extreme. Buying makes sense there almost only if you want to inherit or have inherited.

I once had a conversation with a real estate agent who wanted to tell me that you can also find many affordable houses if, like me, you want nature around you. Allegedly, everyone wants to live 100 m from the city center. Okay, show me. Well, 800k€ upwards was then "affordable" for her. I believe that many real estate agents have lost any sense of money because there are people who put 1.5 million on the table as an investment. They sometimes don't even live there.

I also noticed that land prices in such areas actually lie between 250-400 € per sqm when the city allocates them. BUT the cities only allocate to developers, who in turn demand multiples of that. So the cities contribute their part to the fact that families can no longer afford single-family houses. I actually find that worrying.

2020-05-10 11:51:40

I have to say that I find it both surprising and very nice how this thread has developed and how we understand each other and our observations and thoughts about it. Middle Franconia, I agree, really has an even more far-reaching problem (in terms of area) with Erlangen, Fürth, and Nuremberg, because there are so many big companies there, some of which are even located more in the countryside. That means you have 3 large cities bordering each other and, in addition, companies in the surrounding area. You accordingly have to go either east or 30 km away from all three cities to get under 500k €. I also find that extreme. Buying only really makes sense if you just want to inherit or have inherited. I once had a conversation with a realtor who wanted to tell me that you can also find many inexpensive houses if you want more nature around you like I do. Allegedly, everyone wants to live 100 m from the city center. Okay, tell me, show me. Well, 800k € upwards was "inexpensive" for her. I believe that many realtors have lost any connection to money because there are people who put 1.5 million on the table as an investment. Some of them don’t even live there. I also noticed that land prices in such areas are actually around 250-400 € per sqm when the city allocates them. BUT the cities only allocate them to developers, who then charge multiples of that. So the cities contribute their part so that families can no longer afford single-family homes. I actually find that worrying.

These are the market conditions. Supply and demand. And yes, the cities allocate more strongly to a developer who markets it. Not worrying, the developer also has to offer market-appropriate prices or no one buys. Every commuter will be glad for home office. I think everything will open up further. So buying cheaply in the countryside was the right decision. With your 5k net, you won’t get far where you are without the inheritance aunt.

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Question regarding the feasibility of financing

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