When prices fall...

Hello everyone, I have a few questions for the experts and hope to benefit from experiences as well!

I, like many, am faced with the question of whether building/buying is worthwhile for me!
I have calculated the comparison between buying vs renting and tend towards renting!

Simply for the reason that I currently consider buying/building too expensive and am somewhat speculating on falling prices, as I currently see too many risks in financing and would have to sacrifice quality of life!

Unfortunately, I can’t find much on the topic of building vs buying! Here I am especially interested in how construction prices might develop if real estate prices fall!
Are there statistics and correlations on this?

So the wage level of craftsmen probably will not decrease if real estate prices fall or interest rates rise!
I can’t find much on this and would be interested in your experiences and opinions!

So far, I have not been able to discover any real correlation between the house price index and the construction price index, except that both steadily increase.
It seems as if construction prices react significantly more delayed to market changes, whereas purchase prices are increased quarterly!

This would mean that as soon as real estate prices fall, construction prices remain stable and thus buying becomes more attractive and building becomes rather less attractive... until prices rise again!

Thus, building is only interesting in phases like now where the price of a single-family house from the 70s including renovation is approximately as expensive as a new build, or am I mistaken?

I hope you can enlighten me a bit, because this life decision bothers me somewhat and should probably be well thought out!

To simplify, not all parameters that are already touched upon in renting vs buying should flow in!
Divorce, children, unemployment, rent in retirement, etc.!

I am interested in the correlations between construction prices and purchase prices!

Thanks in advance

That is a good question, but does it even make sense now, with interest rates continuing to fall, to speculate about what might happen in 5-10 years? Construction prices will definitely continue to rise. And there is no end in sight. Do you have that much time to wait? But well, I’ll go along with the thought experiment. In my opinion, purchase prices will fall first before new build prices decline, because the builder has order books that may be filled for 1-2 years. On the other hand, existing properties can be sold immediately and price reductions can quickly respond to the loss of interested buyers. But as long as interest rates do not exceed 3-4% for 15 years, things will continue to go uphill.

This tendency existed in the USA and was more deeply rooted. There you sometimes had 140% financing and received a Disney voucher. Yes, in Germany financing with or without equity has also increased, at least seemingly. However, I do not see a massive depreciation of real estate prices. The economy is too stable for that.

The economy is still stable but the left-wing ideologues or also the green crazies are in the process of ruining it and then we face what Spain and Greece have already experienced. [Immoblase] will burst due to unemployment, etc.

As our notary put it so well today, "at the moment it is more difficult to find a reliable construction company than a bank loan."

As our notary put it so nicely today, "At the moment it is more difficult to find a reasonable construction company than a bank loan."

True