The usual question: How much house can we afford?

So the situation is tight because your equity is still quite low in relation to the project. You have to expect a rate of €1,700 plus operating costs of €300. So a total of €2,000 and then you are safe.

I hear a little from you that you fear that interest rates and prices for land could continue to rise. The best thing you can do is to buy the land first and already pay off a good part of it. Then you have secured the interest rates for the land and the land itself.

What does your time horizon look like?

Thank you both. Since my wife is a teacher, she does have tasks to do at home from time to time, but she usually finishes work relatively early at least 4 days a week, so a reduction in working hours can at least be kept within limits and not much has to fall away after parental leave. So far, it is also planned that she will return to full-time work.

: What exactly do you mean by time horizon? The time until the planned house construction or until the loan is fully repaid? Or something completely different?

I have also considered just buying a plot of land first, but then I could only repay significantly slower if I still have to pay rent and additional costs for the current apartment. Does such a scenario really make sense? As far as I understand, the plot of land would have to be fully paid off to be considered as equity for a later house construction loan?

I suspect that it might also be possible to count a family loan as equity, but I have not asked about this yet and therefore cannot assume it. In terms of interest rates, such a thing definitely makes sense, as more equity has a significantly positive effect on bank loan interest rates.

An extra repayment of 2,000 to 4,000 euros per year should also be possible.

when you see what is paid in (cold) rent and what the pure house ultimately costs per installment, in my opinion you might as well finance completely. The land value is also recognized as equity, if it is still financed, but then minus the remaining debt. The problem here is that the bank financing the land is initially in the first rank. To be able to redeem the loan free of charge in a complete financing, the land loan should preferably be variable. Alternatively, you are tied to the bank that also finances the land. Either way, multiple costs arise for the registration of the land charge.

Family loans are considered equity and thus improve the lending value, but you of course still have to include them in your personal calculation with the monthly burden. With the current interest on deposits, this can even be a win-win situation for both parties if an appropriate interest rate is used.

I had also considered first buying just a plot of land, but then I can only repay much more slowly if I still have to pay rent and additional costs for the current apartment.

The thing is, you have to save significantly less than you think to shorten your loan term. If you have a financing rate of €1000 per month, you don’t have to save €12,000 to save one year of the loan, but about half that amount at the current interest rates. This is because you naturally do not pay the interest for one year of the loan (which currently at 2% interest and a 2% rate amounts to roughly 50:50).

Thus, even with rent, you can save without major problems and shorten the financing. Buying and financing a plot of land is not a great solution if you have not paid off the plot by the start of construction. There are then issues with the first lien in the land register (financing). Such an approach would be worthwhile if, for example, you manage to pay off the plot in 2-3 years and then want to build. But basically, there is nothing against starting completely with it today.

That’s why I find such a family loan quite charming. There should be a good compromise possible for everyone. I have already done some rough calculations; it’s actually always worth it (if it works out that way). I will definitely check to see whether the relatives are on board and under what conditions.

I just quickly estimated what could come out of optimizing the tax classes before parental leave. That would be an additional €120 per month in parental allowance over the 2 years. If I then switch to class 3 afterwards, we would be at €4,500 - 4,600 per month (instead of €4,000). For that, a tax payment at the end of the year might have to be taken into account. Even if we both return to class 4 afterwards, it would still be €4,120 instead of €4,000. With a bit of maneuvering, this approach seems reasonable to me.

Thanks to both of you. Since my wife is a teacher, she does have things to take care of at home from time to time, but at least she finishes work relatively early four days a week, so a reduction in working hours can be kept within limits and not much has to be cut after parental leave. So far, it is also planned that she will return to full-time work.

Well, my wife is also a teacher and she will probably go back to work at 25%. I wouldn't count on her quickly returning to 100% or close to it. What if the child is not born healthy, what if you realize your child needs your wife more, etc... I wouldn't take the income during the parental allowance phase into account either. It's better to calculate everything with only one salary and then be done by around 60 or so. If the wife then works more again, use the extra for special repayments.