ᐅ No building plot available due to new EU local residency model?
Created on: 11 Nov 2017 21:49
H
Hanneshickel
Hello everyone,
We are a family of two who have been searching for a building plot east of Munich, about 50-70km (30-45 miles) away, near the upcoming A94 highway, for several years. We have applied multiple times to local municipalities near us for a plot under the local resident model, but each time we were rejected due to too few points or because our equity or income was too high. We have too few points because we don’t have children. Since we have been searching for a long time, we have saved around €130,000 (about $140,000) and can save about €15,000 (about $16,000) more each year. However, here you are not allowed to have more savings than the plot would cost (mostly around €150-200/sqm (about $140-190/sqft), so approximately €120,000 (about $130,000)). Also, you are not allowed to earn more than the municipal average, which as a couple is about €80,000 (about $85,000) gross. We, however, earn almost double that gross, so together we have a net income of around €6,500 (about $7,000) per month (both earn roughly the same).
Therefore, our only option is to buy a plot privately. But prices here are extremely high compared to municipal land. We are talking about €500-700/sqm (about $460-650/sqft), so quickly around €300,000 (about $320,000) just for the plot. Then I estimate construction costs of about €400,000-500,000 (about $430,000-540,000) for a 160 sqm (about 1,700 sqft) house with a basement, double garage, and a simple building shape. That means approximately €700,000-800,000 (about $750,000-860,000) in total.
We don’t feel confident financing this amount, as it would easily mean paying over €2,000 (about $2,150) per month for the next 30 years. If one of us takes time off work due to having children, then there would be too little left for living expenses. Or is it now normal to finance this much for a house? My pain threshold is currently around €1,800 (about $1,950) per month for the mortgage.
What do you think?
What other options do we have to get affordable building land?
Or should we forget about building and only look for existing houses?
Thank you and best regards,
Hannes
We are a family of two who have been searching for a building plot east of Munich, about 50-70km (30-45 miles) away, near the upcoming A94 highway, for several years. We have applied multiple times to local municipalities near us for a plot under the local resident model, but each time we were rejected due to too few points or because our equity or income was too high. We have too few points because we don’t have children. Since we have been searching for a long time, we have saved around €130,000 (about $140,000) and can save about €15,000 (about $16,000) more each year. However, here you are not allowed to have more savings than the plot would cost (mostly around €150-200/sqm (about $140-190/sqft), so approximately €120,000 (about $130,000)). Also, you are not allowed to earn more than the municipal average, which as a couple is about €80,000 (about $85,000) gross. We, however, earn almost double that gross, so together we have a net income of around €6,500 (about $7,000) per month (both earn roughly the same).
Therefore, our only option is to buy a plot privately. But prices here are extremely high compared to municipal land. We are talking about €500-700/sqm (about $460-650/sqft), so quickly around €300,000 (about $320,000) just for the plot. Then I estimate construction costs of about €400,000-500,000 (about $430,000-540,000) for a 160 sqm (about 1,700 sqft) house with a basement, double garage, and a simple building shape. That means approximately €700,000-800,000 (about $750,000-860,000) in total.
We don’t feel confident financing this amount, as it would easily mean paying over €2,000 (about $2,150) per month for the next 30 years. If one of us takes time off work due to having children, then there would be too little left for living expenses. Or is it now normal to finance this much for a house? My pain threshold is currently around €1,800 (about $1,950) per month for the mortgage.
What do you think?
What other options do we have to get affordable building land?
Or should we forget about building and only look for existing houses?
Thank you and best regards,
Hannes
Tego12 schrieb:
you are absolutely right as always. Yes, I know that.
ruppsn schrieb:
...What I appreciate about her is that she at least tries to understand the opposing opinion, something not many people in this forum manage, which is all the more reason why I value her.
...Everyone has the right to live as they wish. That’s my opinion. But a forum is also a place to wake people up, set things straight, and show reality when it becomes clear that someone has a wrong perception. Members of the forum have to accept that—me as well as others.
If someone here states a combined salary of 6500€ (about $7,000) for two people, that’s more than a couple earning 4000€ (about $4,300). If the saving rate for the latter is 1500€ (about $1,600), it could be 4000€ (about $4,300) for the former, disregarding other factors. If someone is interested in building a house, you suggest considering the higher figure. What they do with it and what is actually possible is another matter. But hopefully, this sparks a thought process.
I once checked IS24 listings (Munich area within 30km (18.6 miles)) and honestly, there is a serious shortage of realistic building plots. It seems like there is a political strategy behind this, because apparently there is enough housing available for purchase. It’s well known that I am a supporter of buying used houses. At some point (for example, with the second child) you can sell these and move on. That is naturally easier if the property price is generally lower (because of additional purchase costs).
4000€ (about $4,300)… for some, a monthly saving amount; for others, total income—this figure alone should help someone understand what might be feasible for them. The more equity you save, the easier it becomes later and the more choices you have.
I have read about envy and the mainstream twice in this thread. I don’t get the feeling that anyone here envies the OP or that the OP is following the mainstream. Personally, I don’t find this situation great: qualified and well-paid, but you really have to row hard in the economy to achieve what you want. Life is sometimes actually simpler if you work for less in a small town—it’s not a worse life, and it doesn’t make you a worse or less knowledgeable person.
Grym schrieb:
Yes, I am a trollThat's correct
HilfeHilfe schrieb:
In those earning circles, it’s considered "uncool" not to own property. On the other hand, people complain that everything is overpriced. Why is it overpriced? Because the "mainstream" buys everything up and drives the prices up. That can be true in those earning circles, yes.
Those who earn a lot don’t really worry about "having to own" or "ownership" at all... they just laugh about it.
If I had a lot of money, I would only rent. Rent what I want, when I want, where I want. Without having to deal with anything.
In other words, enjoy all the advantages of renting and avoid the disadvantages of ownership.
kaho674 schrieb:
Income group of 6500 net together in Munich? Really? If by "such an income group" a "wealthy group" is meant, then I don't understand that at all...
6500 net together is quite common...
As far as I understand, politicians and local authorities do make efforts to create housing. But it’s more complex than just building a few new roads and increasing impervious surfaces.
I was once told by a local authority that they conduct a needs assessment for daycare centers and similar facilities – but then gain about one-third of the children through immigration during the process. That’s quite surprising.
It also seems strange when, in a municipality of 5,000 residents made up of roughly a dozen districts (meaning the numbers in each district are quite low), new housing developments intended for several hundred people are planned. Naturally, such communities tend to prefer slower growth so that the rural character has any chance to adapt.
Back to the main topic:
In new housing developments with a local resident priority system, there is usually a construction obligation. If a buyer does not start building within the required timeframe, the municipality generally has a repurchase right to prevent land speculation. Whether it makes sense to focus on vacant plots within these local resident models is therefore questionable.
I was once told by a local authority that they conduct a needs assessment for daycare centers and similar facilities – but then gain about one-third of the children through immigration during the process. That’s quite surprising.
It also seems strange when, in a municipality of 5,000 residents made up of roughly a dozen districts (meaning the numbers in each district are quite low), new housing developments intended for several hundred people are planned. Naturally, such communities tend to prefer slower growth so that the rural character has any chance to adapt.
Back to the main topic:
In new housing developments with a local resident priority system, there is usually a construction obligation. If a buyer does not start building within the required timeframe, the municipality generally has a repurchase right to prevent land speculation. Whether it makes sense to focus on vacant plots within these local resident models is therefore questionable.
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