Use Riester and family support in a targeted manner

Since when can you withdraw Wohnriester annually from the contract and use it for an early repayment? I don’t know that structure yet. If it works, I’ll be the first to do it.

From April I have a surplus of €1,700 and after the birth of our twins, there will be an additional €1,000 salary increase + child benefit of €500. If I add our cold rent of €800, I have a decent monthly income to realize financing without equity, right?

What kind of salary increase is that? Family allowance? In any case, the €1,000 per month will kick you out of the subsidy because you would then be over €80,000/year. It’s nice that after 4 pages we finally clarified that.

But okay, let’s calculate with your numbers:
1,700 + 1,000 + 500 + 800 = €4,000.
Looks good at first, now let’s first deduct something for the twins, say €800.
4,000 - €800 = €3,200
Then let’s consider that a single-family house for 5 people will have higher additional costs than the apartment you currently live in. Let’s say another €200.
3,200 - €200 = €3,000

If you put these €3,000 fully into the annuity (which no bank will accept with an income of €6,000), you’d end up with a budget of €600,000 at 4% interest and 2% amortization, which your house, land, garden, incidental construction costs, etc., may cost. Calculate for yourself whether that is enough for your single-family house project. I suspect not.

Not considered is that you apparently have lived very well so far and presumably don’t want/can’t change that overnight.

Again: Without equity, I would look for a terraced middle house or a condominium in your place. At the moment, I don’t see a single-family house for you.

Am I approaching the financing the wrong way?
Please enlighten me why this financing cannot work like this.

I think you are approaching it the wrong way, yes!
It reads as if you are trying to base your entire financing on new - partly unclear - subsidies and non-existent equity capital.
The fact is, you absolutely have to start saving and set priorities. It cannot be that on one hand you are paying off an expensive car loan and on the other hand you “nice-calculate” what you could save with KFW grants - how quickly things changed with KFW we saw in 2020/21, and KFW40 NH is no cheap off-the-shelf house.

This is how we proceeded: after graduation no unnecessary loans/financing, vehicles bought in cash, money saved, proper income/expenses calculation, sought land, simultaneously obtained house offers to check feasibility, checked credit framework/options (advisor), bought land/updated house offers beforehand, signed house offer, signed loan.

I see you right now at the point “no unnecessary loans/financing” and “saving money” combined with “proper income/expenses calculation.” That is certainly difficult and not clearly calculable with three children and one earner, but essential, especially since you seem to earn well. I would first specifically look at what net income comes in with three kids and what is left afterward.
Whether it will work with the house in two years no one can answer. But what is clear is that saving as much as possible and building equity must be the goal if owning your own property is your dream.

The withdrawal of assets from Riester contracts is possible as long as at least €3000 remains in the capital. If I am wrong, please correct me. The allowances could be used immediately for the special repayment of the loan.

I am eligible for funding, as mentioned in previous posts. I will not earn more than €72,000 gross, and parental allowance as well as child benefits do not count towards the taxable net income.

I want to have a prefabricated house (wood) built in order to also receive the maximum funding there. For a plot of land costing €100-140k for 500 sqm and 160 sqm living space without a basement, I don’t need €600k, right?

And to my predecessor: I totally agree with you. Of course, we will wait and see what actually arrives. But I would like to take advantage of the new homeownership subsidy because I find it very attractive for families in times of rising interest rates.

I want to have a prefabricated house (wood) built in order to receive the maximum subsidy there as well. For a plot costing 100-140k for 500 sqm and 160 sqm living space without a basement, I don't need 600k, do I?

I would even assume that the 600k will not be sufficient. Without the plot (140k), you have 460k left. I calculated about 3000k per square meter for us, however KFW55 without additional costs and solid construction. I don’t know what the current KFW40 NH standard costs, but you will easily pay the 3000k per square meter – no idea what it will be in two years. Then you are at 480k for 160 sqm without additional costs.

The withdrawal of assets from Riester contracts is possible as long as at least €3000 capital remains. If I’m wrong, please clarify. You could immediately use the subsidies for the special repayment of the loan.

As mentioned a few posts ago, I am eligible for subsidies. I will not earn more than €72,000 gross, and parental allowance as well as child benefit do not count towards taxable net income.

I want to have a prefabricated (wood) house built in order to also receive the maximum subsidy there. For a plot costing €100-140k for 500 sqm and 160 sqm living space without a basement, I don’t need €600k, do I?

And to my predecessor: I totally agree with you. Of course, we will first wait and see what actually comes through. But I would like to take advantage of the new home ownership subsidy because I find it very attractive for families in times of rising interest rates.

Phew, honestly no idea how you want to get the house as an Efficiency House 40 in this size and for this money nowadays, especially since the prefabricated house implies that you won’t do much yourself, which would be hardly possible anyway with newborn twins, a third child, and a full-time job.

Don’t forget all the incidental construction costs!
You also always have to keep the outdoor facilities in mind, which will cost several tens of thousands more.

So with €3000/sqm * 160 sqm, you’ll spend €480,000 on the house alone. Let’s say you somehow manage it at €2500/sqm, that’s still €400,000 + €140,000 plot + incidental costs + outdoor facilities.

So if you stay well under €600k with the project and these plot costs, then respect.

The father-in-law is doing the electrical work. Also, purchase at cost price for kitchen and bathroom is possible through contacts. There is potential for savings. The brother-in-law built a prefabricated house for 2400€.