We have now decided to start building a house from autumn 2019, even though personally I would have much preferred to buy. On one hand, I’m happy that our long-held plans are finally coming to fruition; on the other hand, I’m currently frustrated that we spent 5 years searching in vain – 5 years of rent payments at 600 euros per month (about $650 USD) times 12 months times 5 years equals 36,000 euros (about $39,000 USD)… money we could have already paid toward a mortgage.
My parents had their mortgage paid off by age 50. According to our repayment plan, I expect to be in my early 60s when we finish.
We posted several ads, told everyone we know, left notes in mailboxes of vacant properties, and kept our eyes open everywhere… all ultimately futile. We could have bought something in November 2017 but were outbid at the last moment by about 10,000 euros (around $11,000 USD). That was not worth it to us, especially since the agent was also asking for a commission. That’s life…
One real estate agent told us that interesting properties sometimes have to be marked inactive within an hour after listing because the phone won’t stop ringing otherwise.
About 95% of the viewings we did turned out to be disappointments: mold, water damage, kilos of pigeon droppings in the attic, awkward floor plans, very old electrical installations, filthy bathrooms, no mobile reception, slow internet, impending road and sewer construction of 1.5 years duration with cost repartition, paint shops, and noisy neighbors like arcades, and so on.
Supposedly, half villages are empty here in northern Hesse and many houses are waiting for buyers. But I really don’t see that, except for some dilapidated half-timbered houses on main roads.
This year, our patience ran out because I don’t believe anything will change in the next 5 years either.
How long did it take for you? Or did you skip the “fun” and decide to build right away? I’d be glad to read about your experiences.
Have a great weekend!
My parents had their mortgage paid off by age 50. According to our repayment plan, I expect to be in my early 60s when we finish.
We posted several ads, told everyone we know, left notes in mailboxes of vacant properties, and kept our eyes open everywhere… all ultimately futile. We could have bought something in November 2017 but were outbid at the last moment by about 10,000 euros (around $11,000 USD). That was not worth it to us, especially since the agent was also asking for a commission. That’s life…
One real estate agent told us that interesting properties sometimes have to be marked inactive within an hour after listing because the phone won’t stop ringing otherwise.
About 95% of the viewings we did turned out to be disappointments: mold, water damage, kilos of pigeon droppings in the attic, awkward floor plans, very old electrical installations, filthy bathrooms, no mobile reception, slow internet, impending road and sewer construction of 1.5 years duration with cost repartition, paint shops, and noisy neighbors like arcades, and so on.
Supposedly, half villages are empty here in northern Hesse and many houses are waiting for buyers. But I really don’t see that, except for some dilapidated half-timbered houses on main roads.
This year, our patience ran out because I don’t believe anything will change in the next 5 years either.
How long did it take for you? Or did you skip the “fun” and decide to build right away? I’d be glad to read about your experiences.
Have a great weekend!
Mottenhausen schrieb:
Contract signed end of Nov. 18, but still subject to financing approval; initial payments will be made from equity. Construction start depends on weather, planned for February or March, but no later than April 1, 2019, according to the contract. Now it’s time to finalize the building notification, appointments for further (detailed) planning are imminent. Soil report has already been arranged early on, surveyor contracted. Energy consultant for KfW55 standard also completed and paid. So many tasks were completed even before signing.I’m curious to see if everything works out as you expect. From my experience, everything that’s within your control runs smoothly and on schedule; everything else depends on the other parties involved. Regarding the trades, we have no delays after 1.5 months of construction. But everything before that—site development, surveying, land registry, etc.—was a complete mess timewise and cost us at least 6 months. Also, dependency on the neighbor because of the slope caused an additional month of delay.
But I don’t want to complain; now we have build subsidy and home ownership allowance :-p as compensation.
M
Mottenhausen1 Dec 2018 21:12Infrastructure is 100% complete. Some neighbors have already started building and received their temporary construction power supply within a few weeks, so this process seems to be running smoothly here as well. We are still waiting for the land registry, but the property tax has been paid and hopefully will be finalized before Christmas. The surveyor has deadlines of a few days after requesting partial services according to the contract (their office is 5 minutes from the construction site). I hope everything works out! (It probably won’t, I know, but we have done everything within our power.)
Mottenhausen schrieb:
On the other topic here: to wait or not... not everyone can wait. The benefit is greatest for a young family while the children are still small and can play in the garden. If I wait for a bubble to burst now, the children will be so grown up that they’ll mostly just be sitting in front of the computer or something similar, so I might as well stay in the rental apartment.That’s exactly right. If I were in my mid-to-late fifties, with my family planning complete and now searching for a suitable retirement home, I would also take a relaxed approach and give myself 3-5 years to find one. And if not, I’d just stay in my house.
As a renter in my mid-thirties with plans to start a family and the desire to settle down, the clock is definitely ticking louder.
Of course, it’s possible that due to Trump, Putin, China, Brexit, etc., there could be market upheavals in 1-2 years that would impact the global economy and ultimately the German property market—but right now, there’s no sign of this, and every hesitation and delay so far has only resulted in further price increases. Even if it does happen, the wave of sales won’t be immediate; it would be delayed by several months or even years.
I have no doubt there will be a major price drop at some point. At the latest, when the baby boomers retire, there will be substantial market movement as many want to move closer to their children. But anyone searching today simply can’t afford to wait that long.
M
Mottenhausen2 Dec 2018 00:09I completely agree with that!
By the way:
Even that only applies to a certain extent. Financial crises also have the downside that tangible assets (gold and similar, and unfortunately also real estate) tend to be in higher demand again.
Anyone waiting for a crisis should also be aware that financial crises (as the name suggests) affect their savings as well.
A collapse of the real estate market with corresponding loss of value and price drop would require that nobody buys anymore. NOBODY, not even those currently waiting for the crisis. Otherwise, everyone would just wait and then buy—and if there is such high interest from those waiting, there won’t be a price drop.
By the way:
Jean-Marc schrieb:
. Of course, it is possible that due to Trump, Putin, China, Brexit, etc., there could be disruptions in the stock market within 1-2 years that affect the global economy and ultimately the German real estate market
Even that only applies to a certain extent. Financial crises also have the downside that tangible assets (gold and similar, and unfortunately also real estate) tend to be in higher demand again.
Anyone waiting for a crisis should also be aware that financial crises (as the name suggests) affect their savings as well.
A collapse of the real estate market with corresponding loss of value and price drop would require that nobody buys anymore. NOBODY, not even those currently waiting for the crisis. Otherwise, everyone would just wait and then buy—and if there is such high interest from those waiting, there won’t be a price drop.
Mottenhausen schrieb:
The benefit for a young family is definitely greatest while the children are still small and can play in the garden. Well, on the other hand, owning a home is quite a serious commitment—you don’t really build one just for the maximum of about ten years during which the future brats are still cute.
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