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

Farilo schrieb:

If not, please tell me the assumptions you’re using.

Just the forced savings rates alone: 1100 forced savings in your comparison for ownership, which by itself almost balances out the calculation.

Then apartment versus single-family house: If you’re going to compare, please rent an equivalent single-family house...

Just recalculate again based on these premises.

Scout schrieb:

With a net income of 5,000, company cars should be quite common as the primary vehicle, since they cost almost nothing anyway. The second car can then be a small and affordable commuter vehicle.
Otherwise, 500 is realistic, yes.

1,000 for food: destatista says on average 14% of net income is spent on food, dining out, drinks, and tobacco(!). So rather 700 euros.

Regarding the company car... well, it's complicated. Many companies do not provide company cars for individual employees. So, it’s difficult.
Let’s agree on 400 per car.

For food, I based my numbers on my sister’s data. She has three children and says she spends about 1,300 euros monthly on groceries.
I simply deducted 300 for one child.

But I agree with you that it can certainly be cheaper. I just wanted to use figures from real life, not from a statistic.

Farilo schrieb:

Rent – 1000 (INCLUSIVE OF UTILITIES!)

LOL – That rent is for a small, basic apartment outside major urban areas. If you’re considering a small, simple apartment (generally under €10 per square meter cold rent, except in rural or small-town locations), then please also consider an appropriate house. Used, small, and with basic features. In that case, you wouldn’t need to finance €400,000 but only about €250,000, which would correspond to roughly €1,000 monthly including utilities.

If anything, it should be somewhat comparable. Comparing a villa with social housing in terms of cost doesn’t make sense. I’m only talking about a comparable house – not a luxury one.

So, say 100 m² at €10 cold rent as an average apartment in Germany, France, Hamburg, Munich, or other prosperous cities, wherever. Only then can you make reasonable statements. Against that, €400,000 in financing means around €500 monthly cold rent (I consider loan repayment as a savings rate, not rent – otherwise, calculate rent and comparable savings rates together).

No matter how you look at it, financially (in the long term), the owner will always be better off than the renter. However, building wealth this way comes with some inflexibility. Also, one must be careful not to build in declining areas, where hardly anyone wants to live today and even fewer will want to in 20 years.

Scout schrieb:

Just the forced savings alone: 1100 forced savings in your comparison for homeownership, which by itself almost balances the calculation to zero.

Then apartment vs. single-family house: If you want to compare, please rent a comparable single-family house...

Just recalculate again under these assumptions.

Ah, okay. I understand. It is exactly as I suspected and mentioned earlier.

I personally do NOT compare owning a single-family home to renting a single-family home.
Instead, I compare general lifestyles.

Of course, if I want absolutely the same thing, then the calculation will probably come out as you describe it.
But I follow a different approach.

I’m talking about "instead of."
In other words, instead of committing myself for 30+ years with fixed costs over 5,000 (dollars) just to own a home, I prefer to rent something simpler but live a debt-free life with far less "fear" of not being able to pay for my place someday.

I’m talking about different lifestyle models.

If you have already decided to buy a house, no matter the cost, then this whole debate is of course pointless.
But if you are still open and considering advantages and disadvantages, then it doesn’t hurt to also look at lifestyles that do not require homeownership.

Everything has its justification.

OK. Then do the calculation again for a rental apartment versus a condominium of similar size.

Let’s say a loan of 400,000 with 100,000 equity, each 100 m2 (1,076 sq ft) and a maximum age of 20 years, in the suburban area of the city of your choice.

The results will be similar.

Otherwise: a lifestyle choice does not depend on who is listed in the land register. Your landlord or you.

nordanney schrieb:

LOL – That’s the rent for a small, basic apartment outside of major metropolitan areas. If you take a small, simple apartment (usually under €10 per square meter net rent, except in rural or small-town areas), then you should also consider a matching house—used, small, and with basic features. You wouldn’t need to finance €400,000 but rather €250,000, and then I’d also be at around €1,000 per month including utilities.

Well, that’s exactly the point.

As I mentioned above, I’m not trying to compare a villa with a social housing apartment.
I just want to point out that it’s perfectly possible to live really well without having fixed monthly costs of $5,000.
The apartment for €1,000 at Hamburg’s Fish Market is definitely not social housing.

Sometimes it’s helpful for people to see clearly in black and white what they can or should afford—and what they cannot.

And with less than €6,000 per month, in my opinion—sorry to say—you are not among those who can comfortably buy a house for over half a million and live financially carefree.
Sometimes you just have to face reality.