The bank wants detailed construction plans for financing

Hello everyone,

we are planning to purchase a plot of land in Munich and build with an architect. So far so good – after a long search, we have finally found a plot :). For the financing, the bank now wants to see detailed construction plans as well as a construction description. Our problem: we are nowhere near that yet :confused:. The architect can only create these once there is a specific plot... All that is currently available is the approved buildable area (LxW) as well as the specifications for height, roof pitch, etc.

Since parts of the equity will only be available over the course of the year, we already need a significant portion of the loan for the purchase of the plot. And since interest rates are still at a fairly low level, we would like to arrange the entire loan right away. The notary appointment for the plot is in two weeks. Until then, it is hardly possible to compile the required documents and finalize the financing.

Maybe as a side note: plots are extremely rare here, very expensive (~1,000€/sqm), and sold within a very short time. Opportunities to acquire parcels in a (to us) affordable size in the preferred location are like winning the lottery. Usually, you get completely overpriced developer offers here... and we do not want those.

Has anyone here in the forum had a similar problem? and possibly a solution?

Many thanks for your tips & information!

Hello Erwin,

the time window is indeed too tight and I would advise against a snap decision, so in case of doubt, do not buy the property.

First, discuss with your architect, he can obtain the site plan and the textual specification of the property and discuss with you which construction methods are possible there. Then he can make a rough calculation of the enclosed space based on your equipment wishes and area specifications and multiply it with his experience value per m3 of enclosed space. With this number (plus a 20% reserve for safety) and the land costs, the banker can usually check whether the financing is feasible.

Thank you very much for the quick response. I have informed the architect accordingly for now and hope that he will come over promptly with it.

Not purchasing the land is practically out of the question, as the opportunity, as mentioned, is quite unique. And even if something else were to come up, the problem would be the same again: the time window here is extremely short, you basically have to reserve the plots immediately - and then usually there are two weeks left until the notary appointment. It has been an absolute seller’s market here for some time :(

It has been an absolute seller's market here for some time :(

If only Bavaria weren't so far away ;). Keep us updated and get back to us here if you have any new questions.

If the plots are so sought after, you can hardly go wrong, and if necessary, you can just sell them!

If the plots are so sought after, then you can hardly go wrong, and if necessary, you can just sell them!

That is basically correct, but I still need financing... And you would be stuck with the "additional costs" when selling.