ᐅ Two young couples are considering building a house but have little experience so far.
Created on: 19 Jan 2012 18:48
R
racmarslHello dear community,
yes, the topic title pretty much sums it up.
We (my girlfriend and I) registered here mainly to read along a bit. Of course, there is a reason behind it, but first a brief background and the current idea developing.
Recently, the two of us went with a very close couple to a prefab house exhibition in Wuppertal. The original plan was just to enjoy the nice weather on Sunday. When we were inside a house by Hanse Haus, we were happily discussing the concept to understand it better, when a very friendly sales representative overheard us, came out of his office, and started a pleasant conversation with us. Naturally, he was a salesperson through and through, but he also gave us some useful ideas.
So now, the four of us are openly considering buying property. It was clear that this would happen at some point, but not exactly now, since we are all in our mid-20s or just above.
But is this relatively young age a dealbreaker when it comes to building a home? Probably not.
Now, quickly to the idea... We are considering purchasing a house that should be divided into two semi-detached units. We would like to live close together because the two ladies have been friends since childhood. Basically, each of us would have their own semi-detached unit with separate construction financing. Everything should be contractually and legally separate.
So... many questions, issues, and so on arise, especially since we are all complete beginners when it comes to buying property.
What should we consider? Are there any reasons to avoid a prefab house? What should we pay attention to when choosing the right company? Is there generally a price range for such a house that could indicate good quality materials, or is it even appropriate to say anything about that here?
What should be considered when choosing the right construction financing? What kinds of securities might one need to provide? Does this depend on the amount of financing? Both parties have equity available. Roughly speaking, what can one expect from a bank if there are two permanent jobs with normal salaries and capital in the low five-figure range?
These are the questions that come to mind right now, but surely there is much more we haven’t thought of yet or that raises further questions. We are very grateful for any comments, reactions, suggestions, ideas, or any other feedback.
Oh yes, one more thing to mention — this will not be a turnkey build. We want to do a lot ourselves due to our own craftsmanship skills and trusted people nearby. Can the work and materials provided personally be somehow included in the construction financing, or would a separate loan be necessary if one has a rough overview of the costs?
I hope this does not all sound too clumsy, but naturally, there are many questions when you are new to something — and that applies here as well. Sorry for the long text, but I hope you’ll get through it and still want to reply.
Best regards from Wuppertal
yes, the topic title pretty much sums it up.
We (my girlfriend and I) registered here mainly to read along a bit. Of course, there is a reason behind it, but first a brief background and the current idea developing.
Recently, the two of us went with a very close couple to a prefab house exhibition in Wuppertal. The original plan was just to enjoy the nice weather on Sunday. When we were inside a house by Hanse Haus, we were happily discussing the concept to understand it better, when a very friendly sales representative overheard us, came out of his office, and started a pleasant conversation with us. Naturally, he was a salesperson through and through, but he also gave us some useful ideas.
So now, the four of us are openly considering buying property. It was clear that this would happen at some point, but not exactly now, since we are all in our mid-20s or just above.
But is this relatively young age a dealbreaker when it comes to building a home? Probably not.
Now, quickly to the idea... We are considering purchasing a house that should be divided into two semi-detached units. We would like to live close together because the two ladies have been friends since childhood. Basically, each of us would have their own semi-detached unit with separate construction financing. Everything should be contractually and legally separate.
So... many questions, issues, and so on arise, especially since we are all complete beginners when it comes to buying property.
What should we consider? Are there any reasons to avoid a prefab house? What should we pay attention to when choosing the right company? Is there generally a price range for such a house that could indicate good quality materials, or is it even appropriate to say anything about that here?
What should be considered when choosing the right construction financing? What kinds of securities might one need to provide? Does this depend on the amount of financing? Both parties have equity available. Roughly speaking, what can one expect from a bank if there are two permanent jobs with normal salaries and capital in the low five-figure range?
These are the questions that come to mind right now, but surely there is much more we haven’t thought of yet or that raises further questions. We are very grateful for any comments, reactions, suggestions, ideas, or any other feedback.
Oh yes, one more thing to mention — this will not be a turnkey build. We want to do a lot ourselves due to our own craftsmanship skills and trusted people nearby. Can the work and materials provided personally be somehow included in the construction financing, or would a separate loan be necessary if one has a rough overview of the costs?
I hope this does not all sound too clumsy, but naturally, there are many questions when you are new to something — and that applies here as well. Sorry for the long text, but I hope you’ll get through it and still want to reply.
Best regards from Wuppertal
N
NorbertKoch19 Jan 2012 20:30Hello racmarsl!
Many questions at once. You probably have a friend who is a civil engineering student or holds a bachelor’s degree. I would clarify these points with them.
Regards
Many questions at once. You probably have a friend who is a civil engineering student or holds a bachelor’s degree. I would clarify these points with them.
Regards
M
Micha&Dany20 Jan 2012 06:16Hello racmarsl
First of all, welcome to the forum.
Bauexperte has once again explained everything in great detail.
Unfortunately, in my opinion, one very important point was missed:
Definitely start looking for a plot of land!
The land is, besides proper financing and the right building partner, the most important factor!
Remember, you will live there for the rest of your life (or at least for the next few decades)!
The location of the land is crucial – do you want to live in a rural area or in the city? How is the connection to highways and public transportation? What does your daily commute to work look like? Are heavy traffic jams to be expected (I live in the Ruhr area – the question about daily traffic jams is very important *g*)?
There are many additional factors to consider.
I myself was once offered a plot where I could have built my dream house. The only downside: I didn’t want to spend the rest of my life within sight of the sound barrier wall on the A40 motorway.
So this won’t be my dream house, but it is on my dream plot of land.
It’s not uncommon to search for land for two years. If you are planning to build a semi-detached house, it will be even more difficult because you need two adjacent plots where the local development plan permits a semi-detached house.
As long as you don’t sign anything, you haven’t done anything wrong. Get non-binding information first, so you can get a feeling for the price per square meter in your region.
Have fun planning and dreaming!
Micha
First of all, welcome to the forum.
Bauexperte has once again explained everything in great detail.
Unfortunately, in my opinion, one very important point was missed:
Definitely start looking for a plot of land!
The land is, besides proper financing and the right building partner, the most important factor!
Remember, you will live there for the rest of your life (or at least for the next few decades)!
The location of the land is crucial – do you want to live in a rural area or in the city? How is the connection to highways and public transportation? What does your daily commute to work look like? Are heavy traffic jams to be expected (I live in the Ruhr area – the question about daily traffic jams is very important *g*)?
There are many additional factors to consider.
I myself was once offered a plot where I could have built my dream house. The only downside: I didn’t want to spend the rest of my life within sight of the sound barrier wall on the A40 motorway.
So this won’t be my dream house, but it is on my dream plot of land.
It’s not uncommon to search for land for two years. If you are planning to build a semi-detached house, it will be even more difficult because you need two adjacent plots where the local development plan permits a semi-detached house.
As long as you don’t sign anything, you haven’t done anything wrong. Get non-binding information first, so you can get a feeling for the price per square meter in your region.
Have fun planning and dreaming!
Micha
M
Micha&Dany21 Jan 2012 07:29racmarsl schrieb:
At the exhibition, the real estate agent told us that you first need to be clear about WHAT you want to build, and then look for a suitable plot of land.Hi again
(1) Well, everyone has to decide that for themselves. The "agents" working for the developers want only one thing: your signature.
Some have tried this with us too: sign first, then they find the right plot of land for you.
Sounds great.
But there is one downside:
If you sign first, you have no idea what the house will cost. Yet, you are already committed to that provider. They can now calmly dictate the prices, and you won’t be able to back out.
(2) If your "agent" looks for the plot for you, you need to be careful that you don’t end up having to pay property transfer tax on both the land and the house. The agents often say not to worry about this— but what the tax office says is another matter!
(3) Dream house or dream plot — that’s a decision you have to make. It rarely works out to get both!
Even if you know exactly what you want to build, the plot where you can build might not be in the right location.
I wanted to build a detached 1.5-story single-family house (without a basement). But the plot where I could’ve built that house was right next to the highway. Now I live in an ideal location (quiet but very well connected – public transport, A40, A43) but have to build a 2.5-story semi-detached house — and our neighbor has a basement, meaning we need to invest about 8000 Euros more in the foundation.
We chose the better location and are making compromises with the house. Other builders might see it differently and prefer to compromise on the location in order to build their dream house — that’s a decision everyone has to make for themselves.
But finding a plot in the perfect location where you can build your dream house...
might be difficult.
Best regards
Micha
B
Bauexperte21 Jan 2012 13:12Hello,
I hardly believe you spoke to a real estate agent in W’thal; it was probably a seller who either “also” or solely – depending on the size of the provider in question – acts as the "land specialist." I’ve personally had to spend some time there and know those tactics all too well.
The answer you received suggests that my assessment is probably not wrong. If you agree to the “deal” now, the seller will be happy because they have all the time to gradually tie you to their company; meanwhile, you can no longer get out of the “situation” and will have to accept whatever is offered to you, sooner or later. I find many of the responses here in the forum quite naive when it comes to the land issue; Micha’s approach is far smarter.
I am straightforward in my work and recommendations and focus on keeping the “decisions” where they belong – with the interested party. You want to build, so you should first make sure you know how much money you can actually invest, and only then decide how much you want to spend! That is a very comfortable situation, free of any pressure. Not necessarily convenient for a seller who wants a quick deal, but for a potential homebuilder, there is no safer way to start the “sweet poverty.”
That fits my professional approach… You still need a lot of info and experience. For me, it is important to clear up some “myths” right from the start.
Here and there, you have to “feel good” about the process. Even if you ask the same question for the 20th time, a mortgage advisor should patiently explain it because they have not yet fully achieved their goal – to advise you thoroughly. Remember: sender => receiver.
Yes, there are bad actors in this field too; recently one got caught, and that’s a good thing! The husband of a well-known TV host started a small MLM scheme / pushy insurance sales team and now boasts that “his company checks the finances of potential clients for economic viability.” In reality, nothing has changed because the advice – as expected – is focused on the insurer who pays best. The word “independent” thus slowly acquires a bitter aftertaste.
Then there are so-called mortgage brokers who – like a real estate agent – receive commissions both from the client and from the bank offered... plus many other types of “advisors.”
It is important that you find a truly “independent” mortgage broker. Independent because every income situation requires a different approach. One person has savings, another may need to sell their apartment, another has a job with varying pay schedules, another has so many children that different subsidies apply, and so on. A financing plan should always be tailored to the personal situation; the last percentage point is usually irrelevant because what matters is the monthly burden and how to reach the goal – debt freedom. Of course, there should be enough room left for repairs, purchases, and quality of life; after all, nobody should become a slave to their own home.
If you – against expectations – cannot find anyone or the search becomes difficult, I can give you a contact in Krefeld where you can receive independent advice. And NO, I do not get any commission.
That is only the case at the beginning and is completely normal. Bit by bit, the information will come together into a clear picture, and you will be able to evaluate it yourself through reading and understanding.
Best regards
racmarsl schrieb:
Regarding the plot of land. At the exhibition, the real estate agent told us that you should first be clear about WHAT you want to build and then look for a suitable plot. Do you think that’s the wrong approach? I actually don’t think so, to avoid situations like with your dream plot.
I hardly believe you spoke to a real estate agent in W’thal; it was probably a seller who either “also” or solely – depending on the size of the provider in question – acts as the "land specialist." I’ve personally had to spend some time there and know those tactics all too well.
The answer you received suggests that my assessment is probably not wrong. If you agree to the “deal” now, the seller will be happy because they have all the time to gradually tie you to their company; meanwhile, you can no longer get out of the “situation” and will have to accept whatever is offered to you, sooner or later. I find many of the responses here in the forum quite naive when it comes to the land issue; Micha’s approach is far smarter.
I am straightforward in my work and recommendations and focus on keeping the “decisions” where they belong – with the interested party. You want to build, so you should first make sure you know how much money you can actually invest, and only then decide how much you want to spend! That is a very comfortable situation, free of any pressure. Not necessarily convenient for a seller who wants a quick deal, but for a potential homebuilder, there is no safer way to start the “sweet poverty.”
racmarsl schrieb:
@Bauexperte You really gave a lot of impressions..
That fits my professional approach… You still need a lot of info and experience. For me, it is important to clear up some “myths” right from the start.
racmarsl schrieb:
We are basically clear about the finances, so we should aim for an independent mortgage broker. Are there any recommendations or things to watch out for? Because there are certainly bad actors, and they can tell people like us almost anything.
Here and there, you have to “feel good” about the process. Even if you ask the same question for the 20th time, a mortgage advisor should patiently explain it because they have not yet fully achieved their goal – to advise you thoroughly. Remember: sender => receiver.
Yes, there are bad actors in this field too; recently one got caught, and that’s a good thing! The husband of a well-known TV host started a small MLM scheme / pushy insurance sales team and now boasts that “his company checks the finances of potential clients for economic viability.” In reality, nothing has changed because the advice – as expected – is focused on the insurer who pays best. The word “independent” thus slowly acquires a bitter aftertaste.
Then there are so-called mortgage brokers who – like a real estate agent – receive commissions both from the client and from the bank offered... plus many other types of “advisors.”
It is important that you find a truly “independent” mortgage broker. Independent because every income situation requires a different approach. One person has savings, another may need to sell their apartment, another has a job with varying pay schedules, another has so many children that different subsidies apply, and so on. A financing plan should always be tailored to the personal situation; the last percentage point is usually irrelevant because what matters is the monthly burden and how to reach the goal – debt freedom. Of course, there should be enough room left for repairs, purchases, and quality of life; after all, nobody should become a slave to their own home.
If you – against expectations – cannot find anyone or the search becomes difficult, I can give you a contact in Krefeld where you can receive independent advice. And NO, I do not get any commission.
racmarsl schrieb:
Otherwise we’ve read a lot here, but there are so many impressions that you don’t really know what you should be interested in right from the start and what might only become important later on.
That is only the case at the beginning and is completely normal. Bit by bit, the information will come together into a clear picture, and you will be able to evaluate it yourself through reading and understanding.
Best regards
So... don’t think that all this information has overwhelmed us, but we are diligently reading through everything.
A quick note about the independent mortgage broker... after a brief search, we found someone in Düsseldorf, but feel free to share any contacts you know @Bauexperte
Yesterday, we sat down with our good friend Excel and listed all the expenses over the year, breaking everything down into monthly amounts. After deducting rent, I personally believe that it is currently not feasible.
It is rightly said that interest rates seem very favorable right now, but what good is that if you don’t have the necessary initial capital and other requirements to take advantage of it? Given the current situation and the certainty that our salaries are unlikely to increase significantly anytime soon, I expect that all of this will be postponed indefinitely.
We will now try to save as much money as possible as quickly as possible. Our calculations give us some encouragement regarding saving. Nevertheless, purely for informational purposes, we will have some talks with relevant experts just to broaden our perspective. Naturally, we will also be reading here extensively until our heads are spinning.
Regarding the plot purchase process: we are not deceiving ourselves either @Micha. The idea of a dream house on a perfect plot almost feels like a fairy tale. Although we felt like we came quite close to both over the weekend ^^
Thanks for the suggestion that maybe we should clarify the plot first... Will we then automatically be informed about what is permitted to build and what is not, or does this only happen upon inquiry, either by us or the home builder?
And then there’s a completely different question that came up, just out of curiosity. What kind of fixed monthly costs can a homeowner expect? I don’t mean an amount, but rather what kinds of insurance and other ongoing obligations are typically involved?
Have a nice evening everyone
A quick note about the independent mortgage broker... after a brief search, we found someone in Düsseldorf, but feel free to share any contacts you know @Bauexperte
Yesterday, we sat down with our good friend Excel and listed all the expenses over the year, breaking everything down into monthly amounts. After deducting rent, I personally believe that it is currently not feasible.
It is rightly said that interest rates seem very favorable right now, but what good is that if you don’t have the necessary initial capital and other requirements to take advantage of it? Given the current situation and the certainty that our salaries are unlikely to increase significantly anytime soon, I expect that all of this will be postponed indefinitely.
We will now try to save as much money as possible as quickly as possible. Our calculations give us some encouragement regarding saving. Nevertheless, purely for informational purposes, we will have some talks with relevant experts just to broaden our perspective. Naturally, we will also be reading here extensively until our heads are spinning.
Regarding the plot purchase process: we are not deceiving ourselves either @Micha. The idea of a dream house on a perfect plot almost feels like a fairy tale. Although we felt like we came quite close to both over the weekend ^^
Thanks for the suggestion that maybe we should clarify the plot first... Will we then automatically be informed about what is permitted to build and what is not, or does this only happen upon inquiry, either by us or the home builder?
And then there’s a completely different question that came up, just out of curiosity. What kind of fixed monthly costs can a homeowner expect? I don’t mean an amount, but rather what kinds of insurance and other ongoing obligations are typically involved?
Have a nice evening everyone