ᐅ The situation in the real estate market... unbelievable
Created on: 12 Nov 2019 18:29
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Reinhard84.2
Hello everyone,
We are currently looking for a property in the Lower Rhine region, which is not a particularly sought-after area, but unfortunately, the prices are not any better than in eastern Germany. When calling several real estate agents, they mentioned up to 50 viewings scheduled for one property. This was for a standard semi-detached house with a somewhat larger plot. I get the impression that as soon as a house has a garden bigger than a chicken coop, the interest is incredible.
Of course, the municipalities are not designating any new building land, as that would spoil the surroundings… (to what extent that is still possible is left to their imagination). This naturally has the convenient side effect that existing building plots and older properties are insanely expensive.
You can probably wait half a lifetime for the supposed recession, falling prices, and available properties. It’s all frustrating and a real pity.
Thanks for listening.
We are currently looking for a property in the Lower Rhine region, which is not a particularly sought-after area, but unfortunately, the prices are not any better than in eastern Germany. When calling several real estate agents, they mentioned up to 50 viewings scheduled for one property. This was for a standard semi-detached house with a somewhat larger plot. I get the impression that as soon as a house has a garden bigger than a chicken coop, the interest is incredible.
Of course, the municipalities are not designating any new building land, as that would spoil the surroundings… (to what extent that is still possible is left to their imagination). This naturally has the convenient side effect that existing building plots and older properties are insanely expensive.
You can probably wait half a lifetime for the supposed recession, falling prices, and available properties. It’s all frustrating and a real pity.
Thanks for listening.
I think the panic about getting a new roof, heating system, windows, etc., is greatly exaggerated. Of course, it’s something to keep in mind, but how often does it actually become necessary?
Roof? Are today’s materials really so poor that you have to replace them after 30 years? In my area, roofs are only replaced when dormers are added afterward. Otherwise, roofs around here are not replaced.
Windows? They can be replaced, but it’s not mandatory. Nowadays, almost all windows have triple glazing anyway.
Heating? I don’t know anyone whose heating system lasted “only” 15 years. Or are today’s heating systems really so bad that you have to throw them away after such a relatively short time? You mostly hear about extreme cases where things went wrong, but not about the 99% where everything works smoothly—because no one cares about that.
Best regards
Roof? Are today’s materials really so poor that you have to replace them after 30 years? In my area, roofs are only replaced when dormers are added afterward. Otherwise, roofs around here are not replaced.
Windows? They can be replaced, but it’s not mandatory. Nowadays, almost all windows have triple glazing anyway.
Heating? I don’t know anyone whose heating system lasted “only” 15 years. Or are today’s heating systems really so bad that you have to throw them away after such a relatively short time? You mostly hear about extreme cases where things went wrong, but not about the 99% where everything works smoothly—because no one cares about that.
Best regards
Bookstar schrieb:
How do you come up with this very peculiar number and why do you base it only on that?Hello Bookstar,I arrived at this figure by considering the approximate average income and average equity of potential homebuyers, which I then refer to as "normal circumstances."
In other words, people seriously thinking about buying a house generally have an income between 4,000 and 6,000 (currency varies) and equity of around 40,000 to 70,000.
Based on these numbers, I cannot in good conscience recommend anyone to buy a single-family home for 650,000.
If these people then need to finance, for example, 230,000, that’s still a lot—but much more manageable than financing 400,000 to 500,000.
At the same time, the risk of loss is lower if they have to sell the house in a worst-case scenario. (Of course, location is key. But a property 120 km (75 miles) away from the nearest store in Germany also won't cost 300,000.)
And the monthly payments on financing, say, 230,000 are much more manageable than on a 500,000 loan. This kind of payment is more likely to be sustained through periods of unemployment, illness, divorce, etc.
Edit: Of course, if someone inherits 400,000 or earns over 8,000 to 10,000 per month, then this figure of around 300,000 is irrelevant. But for "average" people, I think it’s a solid guideline.
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nordanney20 Nov 2019 08:03Farilo schrieb:
Paying off a place for 35 years and then still paying 340 EUR (about 370 USD) monthly in service charges to "improve"/"repair"/"replace" things you actually don’t want. Just two remarks:
1. Why doesn’t he move out if everything is so terrible?
2. Of the 340 EUR (about 370 USD) service charge (which is actually the homeowner association fee), 250 EUR (about 270 USD) are operating costs like heating and others; the rest is the reserve fund for maintenance. He also pays operating costs as a tenant. The alternative as a tenant would be 700 EUR (about 760 USD) basic rent (not in a metropolitan area or special location) plus 250 EUR (about 270 USD) additional costs. Which is financially more attractive?
Well, that depends. It’s quite possible that he is only referring to the maintenance reserve fund here. That means additional operating costs could also apply.
It might also be that the €700 apartment is more modern and renovated. His is not, since he hasn’t done that.
And honestly, Germans are often reluctant to change their situation. They prefer to complain endlessly instead. Especially older people find change difficult.
Yes, they have themselves to blame. But it's human.
I don’t know if that’s really the case, but it certainly could be.
Personally, I have the attitude that I adapt to life. When I settled down at 24, I bought my first house. At 32 it became too small because of the family. So I bought another house and sold the old one.
Now the kids have left, and we’re already considering selling, investing the money in a holiday apartment, and renting a nice flat near the city.
The rest is just money. It comes and goes. As long as you can support your family and nobody needs to beg, everything is fine.
It might also be that the €700 apartment is more modern and renovated. His is not, since he hasn’t done that.
And honestly, Germans are often reluctant to change their situation. They prefer to complain endlessly instead. Especially older people find change difficult.
Yes, they have themselves to blame. But it's human.
I don’t know if that’s really the case, but it certainly could be.
Personally, I have the attitude that I adapt to life. When I settled down at 24, I bought my first house. At 32 it became too small because of the family. So I bought another house and sold the old one.
Now the kids have left, and we’re already considering selling, investing the money in a holiday apartment, and renting a nice flat near the city.
The rest is just money. It comes and goes. As long as you can support your family and nobody needs to beg, everything is fine.
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nordanney20 Nov 2019 08:48Joedreck schrieb:
Personally, I have the attitude that I adapt to life.I completely agree with that! In my mid-40s, I’m already on my fourth property and already looking for number five.Joedreck schrieb:
Well, that depends. It’s quite possible that he is only referring to the maintenance reserve fund here.I have never seen such a high reserve fund accumulated in my entire professional life. The 340€ monthly (about $370) matches perfectly with the monthly property expenses.Joedreck schrieb:
Then it could be that the 700€ apartment (about $760) is more modern and renovated. His isn’t, because he hasn’t done that.That’s just unfortunate. Keeping an apartment in good condition costs money—either you invest it yourself through renovations of your condominium, or you pay for it through rent when the landlord carries out renovations. Either way, someone has to pay.Some of the arguments here are really quite far-fetched.
With my post, I only wanted to emphasize that it doesn’t make sense to compare renting with owning, as this can’t be judged solely by the monthly payment. Unfortunately, many people don’t understand this.
Another example: we once bought a condominium. The apartment was great, but in a building with six units, there was one owner who made life miserable for everyone. After a long period of suffering, all the owners sold their apartments, including us. Overall, it was a losing investment.
If it had been a rental, you could have simply moved out after three months...
So, don’t just consider the aspects that suit your own argument.
With my post, I only wanted to emphasize that it doesn’t make sense to compare renting with owning, as this can’t be judged solely by the monthly payment. Unfortunately, many people don’t understand this.
Another example: we once bought a condominium. The apartment was great, but in a building with six units, there was one owner who made life miserable for everyone. After a long period of suffering, all the owners sold their apartments, including us. Overall, it was a losing investment.
If it had been a rental, you could have simply moved out after three months...
So, don’t just consider the aspects that suit your own argument.