Variable loan possible / sensible?

As far as salaries are concerned, I know some people who own ET and earn far less than we do. In my opinion, it’s much more about how you handle your finances and what you are willing to do to achieve the goal of your own home/house.

Yes, definitely.
More than one (probably cheap by forum standards) vacation per year is normally not something we do, and if we do, we visit friends/relatives in Prague/Berlin/Vienna... and stay there for free.
Paying for restaurants without any occasion (so of course we go to weddings, birthday parties, baptisms...) I have basically never done and I don’t miss it either.
The last cinema visit was 10 years ago, doesn’t interest me.
We don’t have Netflix, cable, or Amazon....
We buy clothes at a friend’s secondhand shop and only if something else breaks, because I find shopping way too annoying.

And there are even more examples.

No one has to copy that or live like this for a house. I just don’t care about these things regardless of the house.
Why should I buy or do something that I’m not even in the mood for...
But it helps us with building the house :-)

Thanks :) yes, that is currently our “plan”. Only we won’t be able to pay off the plot before construction starts no matter what. That’s why I don’t know if our financial situation will look better from the bank’s point of view in 2-3 years… Probably yes, IF by then we have paid down part of the plot price, the salaries (at least my husband’s salary) have risen/has risen, and the plot value has increased.

You don’t need all the “ifs.”
Because of your significantly better equity base, you will find it much easier to get a loan in 3 years.
And if your incomes really do rise by then, maybe 160 sqm of living space will also be possible. Otherwise, I would definitely turn that screw again at this point.

Yes, definitely.
More than one (for forum standards probably cheap) vacation per year is not normal for us and if so, we visit friends/relatives in Prague/Berlin/Vienna... and stay there for free.
Paying for a restaurant without a special occasion (so obviously we go to weddings, birthday parties, baptisms...) I actually never did and don’t miss it either.
The last time I went to the cinema was 10 years ago, doesn’t interest me.
We don’t have Netflix, cable subscription, Amazon...
We buy clothes at a friend’s secondhand shop and only if something else breaks because I find shopping the most annoying thing ever.

And there are more examples.

No one has to copy this or live like this just because of a house. These things simply don’t interest me regardless of the house.
Why should I buy or do something I have no desire for...
But this helps us with building the house :)

You don’t need all the “ifs.”
Due to your clearly better equity base, you will get a loan much easier in 3 years.
And if your income really has increased by then, maybe 160 sqm of living space will be possible. Otherwise, I would definitely adjust that factor again.

I find this attitude quite good because if the real hobby is the house anyway and other “luxury activities” don’t interest you, then you can clearly afford it.
But if you have always gone on vacation and expensive leisure activities were part of life, that will catch up with you again in 5 years at the latest. I couldn’t restrict myself like that for 30 years or more and only save for the house all the time.
At the moment we pay 1200 for living and save 1000 per month. A house and garden would be nice, but we have little equity and so we stay renting and are very happy with it. Great neighbors, great janitor, beautiful area with lots of nature. We both work full-time and are really glad when we can go to the beer garden twice on weekends and have something to eat. We also allow ourselves 50 euros weekly for sauna visits in winter. A couple of hiking clothes from Schöffel aren’t cheap either. And I wouldn’t want to miss one or two weeks of vacation in the sun. Two cars in the garage, new tires and service for both, then nothing else fits this month. That’s just how it is. Insurance and tax in December and some nice presents then Christmas bonus and half of the rest are gone. Where should the thousand euros come from that I would have to pay for interest and repayment?? And we don’t earn badly. But to get a house in a good location we would have to spend at least 350K and then I would have to spend about 600 to 700 euros more. That would be almost all the savings we have. And hard times also come.

We save as long as possible and maybe buy something nice shortly before retirement/pension. Who knows how things will be by then, maybe only a condo with 60 sqm. I also want to enjoy life and get out then.

I would suggest you buy land, pay it off over ten to fifteen years, and then you will have invested the money well. In 15 years you can still build or sell again at a profit. Land is getting more expensive because there is less and less of it.

On the subject of property value. We bought our property at the end of 2018 and financed it with a variable loan. In 2019, it was then redeemed with a larger loan and for us, it was indeed the case that the property was valued at the new standard land value.

I find this attitude quite good, because if the actual hobby is the house anyway and other "luxury activities" don't interest you, you can clearly afford it. But if you have always gone on vacation and expensive leisure activities were part of life, this will catch up with you again in 5 years at the latest. I couldn't restrict myself like this for 30 years or more and always just save for the place. We currently pay 1200 for housing and save 1000 per month. A house and garden would be nice, but we have little equity and so we remain tenants and are also very satisfied with that. Great neighbors, great caretaker, nice area with lots of nature. We both work full time and are really happy when we occasionally have time to sit twice a weekend in the beer garden and eat something. A sauna visit in winter also costs us 50 euros weekly. A couple of hiking clothes from Schöffel are not cheap either. And I also don’t want to miss out on one or two weeks of vacation in the sun. Two cars in the garage, new tires and service for both, then there is nothing left this month. That's just how it is. Insurance and tax in December and a few nice gifts, then the Christmas bonus and half of the rest are gone. So where should the thousand euros come from that I would have to pay for interest and repayment?? And we don’t earn badly now. But to get a house in a good location we would have to spend at least 350K and then I would have to spend about 600 to 700 euros more. That would be almost our entire savings. And hard times will come too. We save as long as possible and maybe buy something nice shortly before retirement/pension. Who knows how things will look by then, maybe just a condominium with 60 sqm. I also want to enjoy life and get out then. I would suggest you buy land, pay it off over ten to fifteen years and then you have invested the money well. In 15 years you can still build or sell again at a profit. Land is getting more expensive because there is less and less of it.

The problem is that I don’t want/will not spend the next 10-15 years in a 65m2 with the child. It is barely enough for two, even with the baby, if you know that something better is in sight, but when the child grows, it won’t be enough anymore. The current rents already amount to about 1500€ per month. That’s why I don’t want to build in 10-15 years and throw away 1000-1500€ for current rent + pay off land these 10-15 years / I don’t see that as realistic. Either get the land now and do everything to start building in 2-3 years, or completely abandon this idea and look around calmly for a condominium, which we roughly pay off monthly at the current rent price and can continue living without drastic restrictions. But it’s clearly not a dream property then, but maybe comparable to our current 3-room apartment, with the difference that we pay into our own apartment and it is no longer in a desirable city location but rather somewhere in the commuter belt. Admittedly, we have lacked nothing so far – starting with designer clothes to several vacations a year, good cars and enough time/money for hobbies. Even after that there was some left, though not much. According to our household calculation, we don’t have to give up everything either – maybe instead of going out to eat nicely every week, it will be 1-2 times a month. Or no 300€ dress every month, but only in the clearance sale. Everyone has different demands, indeed. As someone wrote somewhere above, we wouldn’t want to live in a nightmare, some may find it unrealistic, but at least we aren’t lying to ourselves. But such extreme saving isn’t necessary either, according to my calculation, after looking at our household plan. And even if, I’d rather look for ways to make more money instead of denying every wish. The options are there: working full-time instead of part-time, changing jobs, further building the self-employment, etc. And until then I reduce expenses where possible (as said, vacations, clothing definitely). Regarding the variable loan for the land, the question is still open for us: the comfortable monthly rate of 600-700€ during the construction phase will probably bring us nothing. With that, we will have paid off nothing in 2-3 years, meaning we do not have more equity. “Only” we have secured a good plot in the dream location at a low price, adjusted our lifestyle for the better / disciplined ourselves and (assumed, but also very likely) increased our income. Whether that will be enough for banks to enable us to build – that is currently our biggest uncertainty.

Hi,
I think you have a construction company in the family and your husband is a civil engineer.
You have the best conditions to buy land and calmly plan the construction, maybe even prepare the building application in advance.
Plan the whole thing on a smaller scale, and if it fits with the development plan, you can calmly submit a building application, which is valid for a certain period – I believe.
Then the land can be prepared, which shouldn’t be a big problem if you have a construction company in the background.
In 2-3 years you will also know how your income situation has developed, and your equity will have increased through partly paid-off land.
The financial requirement will then also decrease through the completed planning and land preparation.
Regards Olli

Morning,
I think you have a construction company in the family and your husband is a civil engineer.
So you have the best conditions to buy land and calmly plan the construction, possibly already preparing the building application.
Do everything on a smaller scale, plan it, and if it fits with the development plan, a building application can be submitted calmly, which is valid for some time - I believe.
Then the land can be prepared, which shouldn’t be a big problem alongside if you have a construction company in the background.
In 2-3 years you will also know how your income situation has developed and the equity will have increased through partially paid-off land.
The financial requirement will then also decrease due to the finished planning and land preparation.
Regards Olli

If it really goes like that, it would be really great. But don’t you see the problem just like I do that in this period we would really pay off very little of the land’s value? In the worst case only 10-15% of the land – that’s nothing.