ᐅ The situation in the real estate market... unbelievable

Pamiko schrieb:

Some of the arguments here are really quite far-fetched.

Of course, a general truth is derived from one or two anecdotes.

The fact that Pamiko’s condominium was sold at a loss is rather an isolated case because if you look at mortgage interest rates over the past 20 years or more, they have dropped dramatically. At the same time, costs have increased. I often say this, but most people finance and buy properties up to a value that they can just barely afford monthly. When interest rates fall, you can borrow more money and afford a higher purchase price. It’s a nice cycle that has worked well for over 20 years. Congratulations to everyone who owns real estate.

That’s why I think it’s pointless to debate absolute house prices. €300,000 (about $320,000) for a property is nothing today. Borrowing money is practically free. But imagine that amount with 4% interest, which used to be common. It would become challenging for homeowners if interest rates rise again for any reason. Or even fall into negative territory.

nordanney schrieb:

Just two comments:
1. Why doesn’t he move out if everything is so bad?
2. Of the 340€ maintenance charges (actually called service charges), 250€ are operating costs like heating and others, the rest goes to the reserve fund for repairs. He also has these operating costs as a tenant. As a tenant, the alternative would be 700€ basic rent (not in a metropolitan area or prime location) plus 250€ additional costs. Which option is probably more financially attractive?

Why he doesn’t move out? No idea. I didn’t ask him... But I could imagine it has something to do with the social environment, which a retiree might not want to change so easily?!
Yep, I meant pure service charges. Additional costs came on top. When I asked him why it’s so high, he said the other owners are pushing through many renovations (balcony, stair railing, entrance door, etc.) and he unfortunately has to pay a huge share proportionally because he owns the largest apartment.

Tassimat schrieb:

That’s why I think it’s pointless to discuss absolute house prices. 300,000€ for a property is nothing today.

Well, that’s exactly the point. 300k is nothing for a house today. But it’s still an enormous amount for an average earner!
Just because prices have risen unimaginably doesn’t mean everyone can afford it.
And whether people financed at 4% or more back then doesn’t make things better today. It was tough even then.

I envy NO ONE who earns less than 6,000€ and has to pay off over 400k. On the contrary. So much life gets lost in that... But humans are masters at sugarcoating once they want something! Luckily, I only do that with much smaller amounts... (fridge, washing machine, etc.)

But hey, everyone to their own.

Farilo schrieb:

I don’t envy ANYONE who brings home less than 6,000 euros (about $6,600) and has to pay off more than 400,000 euros (about $440,000). On the contrary, so much life is lost in that situation...

Has that really been the case in recent years? A young family in their early to mid-30s with a 30-year mortgage term (around 4.5% annuity) would then have a monthly payment of 1,500 euros (about $1,650) and still have 4,500 euros (about $4,950) left to spend. What can this family not do that, for example, families in Düsseldorf/Frankfurt/Cologne/Munich etc. can? There, a new apartment quickly costs 1,500 euros (about $1,650) for 100 sqm (1,076 sq ft)—so smaller than a house, and not to mention the garden and the lifestyle feel (which is the main argument for most homeowners).

Reinhard84.2 schrieb:

And of course, the cities don’t designate any new building land, as that would spoil the surroundings… (to what extent that is still even possible is up to their imagination). This of course has the nice side effect that existing building land and old properties become insanely expensive.

Well… “spoil” is probably not quite the right word. I know you say it ironically. Still, the sealing of surfaces in new housing developments is now less acceptable and comes with many drawbacks.
There is an interesting parallel thread here: While I’m happy for @goalkeeper that he got a spot for his end-of-terrace house, you can read in his thread how sealed the whole new development will be. Unfortunately, the builder no longer even has room for a tree at the house, and whether the local council will green the area is also questionable.
I hope goalkeeper has not restricted his profile like you have, so you can browse through that thread.

Reinhard84.2 schrieb:

Specifically in the KR area, Moers, southern Duisburg on the left bank of the Rhine.

Since we already live in a mid-terrace house (rented), we know quite well what we don’t want.

I once searched Moers with a 10km radius on Immonet. Almost 170 houses came up… The preset distance to Moers doesn’t show any extraordinarily expensive houses, nor any wrecks. The prices remind me of our used houses near (affordable) Hamburg.

And since you seem to reject specific things, you are missing out on some options, and the pressure won’t be that high.

Farilo schrieb:

I don’t envy ANYONE who brings home under $6,000 a month and has to repay over $400,000. Quite the opposite. So much of life is lost… But as humans, as soon as we want something, we become masters at justifying it! Thankfully, I’ve only had to do that with much smaller amounts… (fridge, washing machine, etc.).

I feel the same. It’s crazy how people calculate with razor-thin margins and absolutely have to have their own place at all costs…
We Germans are taught that retirement provision can be found in a property that you live in yourself. I do the same, but I keep the rent-like burden so low that it doesn’t hurt. Without children, you remain flexible.
Children are often used as an argument that they should grow up innocent and free. As if they couldn’t do that otherwise. The poor kids are fenced in their own gardens with their own play structures. The playground 300m (yards) away, where they could play together, remains empty.
That may be somewhat exaggerated, I know.
If something major needs modernizing for us, the house will be sold and an apartment rented!

Maschi33 schrieb:

However, there are also people who refuse this support on their own accord because they don’t want anything given to them for free.

I hadn’t mentioned it, but they pay it back gradually, as I am able. It’s not a gift; that’s the arrangement.

Farilo schrieb:

Hello Bookstar,

I arrived at this figure by considering the perceived average salary and the average equity of potential homebuyers, which I then refer to as "normal circumstances."

It’s really just a feeling. In many states, 300,000 euros (about 320,000 USD) is just the starting point. Of course, with that amount, you can only afford an apartment; a single-family house is a luxury not accessible to everyone.

In our building area, however, there are few homeowners who haven’t received a substantial six-figure financial contribution from their families. Good for them, but I mention this only because I have built up a lot for myself and, despite high debt, can still afford to go on vacation.