We want to build a house

Hello everyone,

briefly about the situation:
we are planning to build a house in the not too distant future. Now it has become possible at short notice to get a plot of land in a very sought-after building area because a prospective buyer has dropped out.

However, we now have only 5 weeks to decide whether we want the plot. After that, a notary appointment must be arranged. Although we already have clear ideas about our home and have calculated the financing to the best of our knowledge, we do not yet have a concrete offer from the bank or a house manufacturer. Initial appointments have now been scheduled, but I fear it will still be tight in terms of time.

In addition, it is a municipal plot with a building obligation within 2 years (end of 16).

The specific question:
The plot costs about 1/5 of the entire project, which roughly corresponds to our equity that we want to invest in the house construction. The idea now is to buy the plot promptly with the equity and to allow about 12 more months for the exact planning of the house. During this time, some equity can also be saved again, but still the house would have to be almost fully financed. Is the own plot treated just like equity or do the loan conditions then deteriorate?

Is it more sensible and feasible to arrange an overall financing within the 5 weeks?

Thank you very much for your answers.

Best regards
Photonik8500

How can you know without having calculated / having an offer so far that the plot costs 1/5 of the total project? And when you talk about the total project, does that include ALL additional costs?

Without knowing where this is going, it will be feasible in 5 weeks, but very risky. Because you need to have all the costs that need to be financed. Then it depends on when you want / can start with the construction.

If the plot can be paid for with equity, do that. Without financing. Afterwards, you have enough time to organize the house and its financing.

Important before the purchase:

- clarify with the bank how much they would generally be willing to give you

- is there a soil survey? There can be significant cost drivers in the soil (silt, groundwater, ...)

- is it a hillside plot? Large height differences are already visible to the naked eye (steep slope = higher costs)

- what does the development plan look like. So: building window etc. (Does the house you have in mind fit? For example, you want a flat roof? Is that allowed? ... Such framework conditions should be clarified to find out if it may be the dream plot, but maybe the dream house is not allowed to be built on it.)

Hello emer,

thank you very much for the quick response.

How can you know that the plot costs 1/5 of the total project without having calculated it or having an offer so far? And when you talk about the total project, are ALL incidental costs included?

We do know the land costs including incidental costs. For the house, it is indeed so far only an estimate. However, not a bad one, since we have already dealt intensively with the topic in advance and have also spoken to one or another provider or requested prices for individual turnkey houses with a basement. We then added a solid surcharge of 30% to these prices and calculated the incidental costs on top of that.

Kitchen and cards are only included with flat rates of 20,000 euros each.

Important before the purchase:

- clarify with the bank how much they would basically be willing to give you

- is there a soil survey? There can be considerable cost drivers in the soil (silt, groundwater,...)

- is it a hillside plot? Large height differences are already visible to the naked eye (steep slope = higher costs)

- what does the development plan look like. That is: building window etc. (Does the house fit in that you are thinking of? Do you want a flat roof, for example? Is that allowed? ... Such framework conditions should be clarified to find out whether it may be the dream plot, but maybe not the dream house may be built on it.)

[*]The thing with the bank is so far also the biggest uncertainty for us, which we can clarify somewhat over the course of next week. Before that is clear, I wouldn’t sign anything either.
[*]A soil survey is available and the plot has a south slope of about 5%.
[*]Our "dream house" would fit into the building gap, but the connection of the garage is then no longer possible as I had imagined. But there is always something ;-).
[*]Building regulations are known and fit our ideas.

Regards Photonik8500

So if you can do that, then go ahead and do it...a fully paid plot of land is the best prerequisite for building a house...you do not worsen your negotiating position with the bank in any way.

And if it has to go quickly, then it just has to be, if it is the desired plot of land...

In the end, we also only took 4 weeks from the first negotiations with the land seller and [GU] until the notary appointment...

Yes, the points are clarified. So it is enough to ask the bank whether financing is possible and to what extent. If the number then fits without destroying oneself, only this remains: buy the [property] and calmly start planning. 2 years are sufficient to avoid rushing anything.

Thank you for the answers, things move really fast here in the forum!