The land has been approved, what is the next step?

Hello everyone,

First of all, thank you for the many suggestions and tips!

We submitted a preliminary building inquiry, and it was approved yesterday by the building authority employee in an informal letter. However, to have a legal basis, we will still receive a more detailed letter.

We have also already received an excerpt from the site plan from the city (in which we had to sketch our building project). Is this plan sufficient for obtaining offers, or is something more precise needed? Measurements are not included on the plan, only the scale.

Regarding the height of the house, I am not worried. My parents' house, which was built in 2.5 stories, serves as a guideline. We definitely cannot afford that. The houses in the neighborhood were also built that way. However, we only want to build 1.5 stories.

Access to the house can only be regulated by registering a building encumbrance. A separate driveway was rejected by the neighbors; we were only granted approval if we use the existing footpaths.

The "neighbor" is building two houses down, and due to the hillside location, his situation is significantly worse than ours. He is building at the lowest possible point, and we are located a good bit higher.

The main concern with the whole project is actually the additional costs due to the special situation. To make matters worse, the house’s exterior wall would end directly at the top edge of a wall that drops down one meter. Therefore, we would probably have to dig a deeper foundation anyway. Our financial situation is not bright at the moment; the bank offered us a loan of over 270,000 euros. However, back then, the property was not yet counted as equity, so I hope for a bit more room to maneuver financially. The property will likely be very small, only the house plus minimal boundary setbacks. Therefore, I fear that financially it might not work out; I would exclude a basement from the outset.

If the bank specifies a financing limit, a piece of land (even a very small one) doesn't change much about that. In the best case, the interest rate may decrease as a result. Falling interest rates must be compensated by increasing the repayment - not by a higher loan. (My worldview)

The limit is therefore determined by the portion of the income that can be repaid to the bank. And that doesn't increase just because you own a property.

What about equity capital otherwise? The bank considers this (ultimately including the house) as security.

What do you think how secure the bank would rate its money in case it comes down to selling the house? A house on a small piece of land and in the second row.

As a bank, I would also put a lid on that quite early.

If the income doesn’t look promising, both together result in a poor position for a high loan.

My bank advisor said that the property is "Bodengeld" and would be fully counted as equity. If a property is available, he would be more willing to finance our project, but did not give exact figures.

For the property, we still have the option to have a 6 Ar garden plot below the mentioned wall transferred to us. However, we actually wanted to avoid this; I don't want to profit from my parents. Therefore, we only wanted to transfer the bare minimum.

Our equity in the bank currently amounts to just under 35,000 euros. The income is stable so far; we have 3,300 euros per month available, including 2x child benefits. The income is currently earned exclusively by me, but my wife will resume work in about 2 years when both children are in daycare.

The thing with the property is nice, but it doesn’t change my statement at all.

I suspect that the income is the reason why it stops at €270,000. That’s also only reasonable.