Situation in the real estate market... madness

... and you get part of the costs back on your taxes

Which then goes towards repairs and maintenance. Purchase costs are added as well.

Those are nonsense numbers, aren't they? Or do you really believe that yourself?

It has nothing to do with belief, these are our numbers.

What goes into repairs and maintenance then. Acquisition costs are added on top as well.

That's what the money is meant for. Similar to depreciation on buildings. You just can't blow it away like that.

Because, as a rule, people who own a house worth over half a million don’t buy a Dacia. (Whether I find that good/sensible or or or or not doesn’t matter for now).

That is your reality. Not mine. And when I look left and right, it’s not my neighbors’ reality either. These are people around forty with small children and a dog, 1.5 incomes in office jobs, all houses beyond 600k. Dacias, Opels, Renaults are seen here in abundance. Dinkies sometimes have a 1 or 3 Series BMW. But that’s about it. The expensive cars are at least seen here mostly at buildings over 1 million, but those are usually self-employed.

50€ gas (to the train station)
90€ annual ticket
20€ insurance
10€ taxes

You correctly calculate mobility costs but then compare them with other people's car costs. None of our cars has an annual ticket.
In addition to car costs, there are depreciation, maintenance & repairs.
In addition to mobility costs, there is the commuter allowance / tax consideration.

Cheap driving for me used to look like this: old 5-series wagon with a V8 engine, 170,000 km driven in 2 years, no repairs, maintenance at the local gas station, cheap insurance (30%, no comprehensive), 900€ depreciation in 2 years. Capital invested for purchase: 1.2 monthly salaries. The extra consumption was easily compensated by the low depreciation and I had the beloved torque for relaxed driving.
That's probably no longer appropriate today – although environmentally, it would certainly be better not to buy new cars but to use existing ones until really environmentally friendly new cars are available. Let the manufacturers first choke on their misdevelopments.

- House including incidental purchase costs and renovation I currently estimate at 550k
- Equity was five figures
- Skoda Fabia estate

So you have to repay a loan of at least 450k.
How does the value of the house stand? Is it possibly worth 700k or more?
How much income do you have?

If you are below the <6k I mentioned, then if you had asked me for my opinion, I would definitely have advised against it.
Nothing more would have happened. It's your own decision anyway.

As long as YOU can sleep well and are happy with the decision, everything is great.

I’m happy to adjust your numbers. OK. But then also please for the tenant. Do you want to say that an average family can no longer even afford an inexpensive apartment?
And again the question. Who sleeps better (if I also increase costs for the tenant, plus rent increases). You still haven't answered that question. In your opinion, the tenant would also have to sweat blood and water because they can hardly afford their rent, let alone live well.

You probably have to agree with me there reluctantly

But in real life, it looks different. Why does everyone have to be overinsured? Why does everyone have to drive an expensive car? Why does everyone who builds a house have to immediately create reserves? Etc. It works and life is good with it.

Hi Nordanney,

There we have the misunderstanding. I had already written that before.
Sure, if you compare the exact same standard 1 to 1, then I could well imagine that you (and others here) are right with the calculations.

How you come to think that I might mean that an average family cannot afford an inexpensive rental apartment escapes my knowledge.

Regarding rent increases, you have a good point.
However, there are also cooperatives out there which are very cautious about rent increases. But apparently that is not the rule, so let’s leave out the cooperatives.

I agree that tenants also sweat blood and water as soon as the rent is to be raised. Preferably due to a renovation that is actually not even necessary, which then pushes the rent up again.

At the end of the day, however, the tenant can just move. It’s no big deal, since there is a 3-month notice period. But I see your point.
At the same time, the risk is relatively "limited" due to the lower amount and the possibility of cancellation.

Regarding possible overinsurance, etc., I’m with you. Except for the point of reserves for the house. Sure, everything works at the beginning and so on. But sooner or later something comes up. That’s just how it is. It’s normal. And usually repairs to the house rarely cost around 100 euros. Somehow I have the feeling that below 1k, no matter what it is, never works...
Also electrical appliances usually only have 1-year warranty etc... They must be replaced sometimes too. If by chance the side-by-side fridge and the stove break down at the same time, it gets tighter.

But regarding expensive cars and overinsurance, I am completely with you!