Your assessment of our financing

We are currently dealing with the topic of building a house.

We already have a floor plan in sight.
There have also been initial talks with construction companies.

Loose contact regarding this with the bank as well, it will become more concrete next week.

The conditions are such that our income is 4000 € net per month (he = 2500 € / she = 1500 €).
We have considered financing that should run for a maximum of 30 years and require a monthly payment of max. 1000 €.
Equity of about 10000 € is available and quite a bit will probably be done through own labor (outdoor facilities, garage, partly during the house construction) in order not to let the sum explode too much; the craftsmanship prerequisites are given.

I would just like to know your assessments in advance, whether it would be feasible to build a new house with our conditions.
Additionally, it might be worth mentioning that a child is expected next year.

I have an exact cost plan that I maintain every month with expenses, running costs, etc., and have roughly calculated the financing based only on my salary including incidental house costs, so that it would still work with monthly costs for the house of 1300 €; not much would be saved at the end of the year, but I calculated this only with my net income without considering my partner's salary.

Thanks a lot in advance.

Well, it depends on the house you want to build. But with the desired rate and the little equity, it looks rather bad if you want to build a classic single-family house without many extras.

Of course, the most important data is still missing: What does the plot of land cost, which house is planned, etc...

If you now assume a low total cost of 350,000 euros, you already have to pay 6,800 euros per year at 2% interest. That means 1,000 euros/month no longer works.

10,000 euros is not equity in house construction, it doesn't even cover the incidental costs. Personal contribution is often overestimated.

What should house and property cost?

I’m going to hypothetically assume €400k and can already tell you that your calculation will not work.

With 100% financing (which only happens if you don’t build with a developer but instead buy a plot from the municipality and have a house built by a general contractor), you will get an interest rate of 2.80% (at best) for a 30-year fixed interest period. This results in a monthly payment of €1,256 without additional costs (plus about €350-400).

After 30 years, you will still have an outstanding debt of €212k.

Now let’s increase the repayment to 2%. This results in an outstanding debt of €24k after 30 years with the same interest rate (since it will not change) and a payment of €1,600 (still without additional costs).

So you see, you will not be able to keep your desired payment in either version; furthermore, you will miss it by at least €400-750, even under the assumption that your wife will be out of work for at least 1-2 years (income-wise).

So the house and property are supposed to cost 250,000, I already have several offers. I know it is always written here about at least 300,000 and much more. But we are also here in a rural area and the house has a normal standard. And with the costs, we have already calculated the worst cases regarding additional building costs. So I assume that the financing amount will be a maximum of 250,000. Regarding my salary, it should certainly be mentioned that it will increase quite soon and then certainly continue steadily (family business allows a realistic estimate here). Sure, it will initially be absent in terms of salary. Then you just have to be a bit more economical than usual.

So the house and property should cost 250,000, I already have several offers. I know here it is always written about at least 300,000 and much more. But we are also in a rural area and the house has a normal standard. And with the costs, we have already calculated the worst cases regarding additional construction costs.

So I assume that the financing amount will be a maximum of 250,000.

Regarding my salary, it should certainly be mentioned that it will also increase quite soon and then certainly continue steadily (family business allows for a realistic assessment).

Of course, the salary will initially be gone. Then you just have to be a bit more economical than usual.

Your future salary does not interest the bank. And it will not stay at 250k. There will still be a hefty amount of additional costs and upgrades.