Why don't construction prices go down?

Whereas the average earner could neither build in 1950, nor 1980, nor 1995. That has always been reserved for "privileged" higher earners. The average earner has always, if feasible, bought an apartment or a used property.

That is correct. The problem is that existing properties are way too expensive. After additional purchase costs, you are often in the range of 80-90% of the new build price, and then the necessary renovations come on top. But I’m not talking about underfloor heating, 10 new sockets per room, or changes to the floor plan, rather about replacing the decaying bathrooms from 1970, drying out the basement, new windows, new heating system, possibly the facade. By now, at least as a buyer, you should have the chance to negotiate the purchase price. An existing property is hardly really cheaper; you just can more easily convince yourself otherwise.

No, "the bank" (almost all of them at least) does NOT include flat-rate ancillary and operating costs in the financing. These costs are indirectly taken into account through a living expense flat rate.

You misunderstood. The 920 euros are included in the living expenses, not in the financing.

So if there is a monthly income of 5000 euros, perhaps 2800 euros go towards repayment and interest plus the 920 euros operating ancillary costs for the house, leaving 1280 euros for the rest. Not much anymore. Food, vacation, car, etc. have to be paid from that, which becomes challenging. That ultimately is still at the level of citizen’s income support.

Certainly, some of that might be eroded by inflation over the years, that can happen but is not necessarily so. On the other hand, there is always the risk of a deflationary shock in real estate prices. That means prices could actually crash again.

So, always stay calm. My tip here as always: Buy when cheap, sell when expensive.

You misunderstood. The 920 euros are included in the living expenses. Not in the financing. So if there is a monthly income of 5,000 euros, then maybe 2,800 euros for repayment and interest plus the 920 euros operating additional costs for the house are deducted, leaving only 1,280 euros for the rest. Not much left. Food, vacation, car, etc. have to be paid from that, which will be tight. In the end, that is still at the level of citizen’s income.

Actually, to take your example, with 5,000€ net, we calculate the living expenses lump sum at 2,500€ for, for example, a family of four (i.e. 4,500€ net income and 500€ child benefit). This does NOT include the arbitrarily assumed amount of 920€. It is significantly (!) lower. Also, no one with 5,000€ net income would get a financing with the rate you mentioned from us. That is unrealistic. Better assume a rate of 2,200 or 2,300€ as realistic. Then there are already 2,700-2,800€ left for living expenses and additional costs. That actually works ;-) A small note about the 920€ operating costs. For example, with a small property and a household net income of e.g. 2,600€, the bank calculates only 1,400€ as a living expenses lump sum. That does not fit with 920€ flat operating additional costs. You can all safely forget this number. It simply does not exist in everyday banking.

But the number fits so well into his argument ;)

Just like often when someone insists on HIS calculation, no matter how the bank calculates. In the end, however, (no matter how "right" or "wrong" it is) only how the decisive authority calculates is relevant and that is exactly the bank.

I read this information somewhere recently from a banker. However, it is not made up.

I can't say who wrote it to me, but it is actually true. Whether it's 100 euros more or less doesn't matter, these 900 euros are now being calculated. Even my insurance aunt confirmed it to me two weeks ago.

Why should I doubt it. Electricity, heating costs, insurance, property tax, garbage, water, sewage, telecom, reserves for repairs. Yes, it adds up significantly.

Anyone who can increases the fees, charges, and everyone pays dutifully. Heat pump service, chimney sweep, stormwater, a household insurance here, a photovoltaic insurance there, an elemental insurance on top. And suddenly the first thousand is gone.

And you can all dream of a new, cost-neutral property tax. That won't happen. After all, the expanding welfare state also has to be financed. And since property owners are immobile, they cannot avoid it.

To stay on topic, the 900 euros is already a substantially good figure.

And you can all just dream of a new, cost-neutral property tax. That's not going to happen.

Whether federal, state, or local governments: There are a thousand good ways to impose new taxes. Only one, even though Bild newspaper has been running a fear campaign against it for years, is precisely not an option, namely the property tax. That it MUST be overall revenue-neutral was very clearly stated by the Federal Constitutional Court when they demanded the reform of the tax. So if you're going to run a fear campaign, then please not one that collapses in seconds due to lack of foundation. The states now have the task of making it fairer while keeping it revenue-neutral, and what they definitely do not want is to raise even one cent more in taxes because then Klaus-Fridolin sues, wins, and the whole thing starts all over again.

So calculate for yourself 90, 900, or 9,000 euros – at the latest when you actually need a loan, that figure evaporates into thin air.