Start a construction project, buy only the land or wait?

  • Erstellt am 2022-04-12 10:34:08

Benutzer200

2022-04-12 12:00:28
  • #1
I would also get in now if the financial framework fits. What the future holds remains to be seen – interest rates will not go down anymore and it will not get cheaper anytime soon. What happens when you wait I am currently seeing at a location in Berlin. An apartment planned for €10,000 per sqm at the beginning of 2020 is now likely to actually be built and sold from summer for €15,000 per sqm.
 

Veltins

2022-04-12 12:01:45
  • #2
First of all, thank you for the valuable input. These are exactly the considerations and discussions that I can really use right now, even though, of course, the decision ultimately has to be made by oneself.



That is currently the consideration. I could practically finance the plot with equity. The question is what will happen with interest rates. In our example, we are currently at 2.5%. Last week it was still 2.1%. Our financing expert and the branch manager of my house bank, with whom I have a close relationship, both expect interest rates to rise moderately to a level around 3 percent by the end of the year. Many credit institutions now only make daily current offers. Quite a lousy time. At least securing current conditions? Through a forward contract probably makes little sense for the limited time. It’s a speculation.


We can still afford it, but only because we can now allocate other monthly repayments. Emotionally, I am wired differently. I do not have the flowery dream of a home of one’s own and to me a house is something for the next 20-25 years. After that, when the children are grown, I will live somewhere else.


Yes, income-wise it works well. I became a civil servant, my wife has a secure job. We are the upper middle class (is that how you say it?) Not rich but really content. We could afford a delay, but in the end it’s also about the willingness. Compared to the last plans, we are already 200k over. No additional house costs are factored in yet.


The construction obligation requires that one must have started one’s building project within 2 years. The requirements are vague. What does started mean? Signing a contract for work? Being finished? That’s pretty vague. Regarding the subsidy, I agree with you. That is no reason for or against.
Keyword lifetime: Our children are 6 and 8. Now they need a garden and a nice environment. And we currently have that while renting. At the moment, I can’t imagine anything nicer than the current apartment that we completely renovated, painted, wallpapered, and furnished with furniture three months ago, by the way. So much for the topic of the right time... The problem is that we will eventually need an additional room. The time here is therefore without pressure but limited. In 5 years it will be too small. Two years ago we bought a condominium here in our desired area, which we currently rent out. That is our "emergency option" should we have to move out unexpectedly. We don’t want to move in there due to lack of a garden, but purely in terms of size it would be possible. It’s all quite complicated.

I currently tend to secure the plot in any case. That goes without headaches. The only risk I take is the fact that I am buying it at a price of 1.25 through the sealed bid process. I am basically paying a 25 percent premium compared to the other, regularly marketed plots. But the location and layout are good. That is my only financial "risk" if I buy the plot first. And then take my time without time pressure to check when it is serious to start again. If the general contractor says that you currently have a lead time of 14-15 months anyway, it naturally makes sense to start after all. Until the excavators roll, another 1.5 years will pass.
 

HansDampf88

2022-04-12 12:27:42
  • #3


If you are happy where you are now and don't have this urgent dream of owning a home, then I wouldn't put myself through the stress in the current times at all. I would secure the plot of land and see how things look in a year and then decide. The plot won't run away.

Judging by your nickname, you come from the HSK. I think when it comes to building deadlines, they are quite relaxed - they are certainly flexible.
 

Nemesis

2022-04-12 12:28:03
  • #4
Something else:



...and you already knew the current plot back then? If not, which I suspect: what planner designs a house without a plot? That is unprofessional and requires an explanation...
 

Veltins

2022-04-12 12:43:52
  • #5
I can agree with all of that. At the moment, I am missing nothing here. But in the medium term, it will be too tight with the two children. I was born in Südwestfalen but no longer live in the HSK. We moved toward the eastern Ruhr area. No, back then we had planned on a similar plot. That fell through at the last minute during the allocation of plots. The current plot is similarly shaped, even larger, and has no different requirements regarding the actual build. Of course, the plot-specific work and everything that happens up to the foundation will be individual. In terms of layout, size, dimensions, etc., everything remains the same.
 

mayglow

2022-04-12 12:51:50
  • #6
My crystal ball also has a crack, but I fear that if it stabilizes, it will be at a high level. My gut feeling would also be to continue planning once it’s in place. To review the current plan again. Does it still fit the property, does it still fit us, how expensive would it be now, and how much buffer would we still have. Will the bank cooperate, etc. Possibly also reflect on a few things to see if one or another "nice to have" can be cut or postponed, that can also ease the situation a bit.
 

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